Things have changed in post Covid-19 world in two different ways:

First, we might see less Banking-FinTech M&A:

The arguments that banks are not fit to be FinTech acquirers strengthened:

• In the face of global economic recession banks will have to maintain even stronger capital base, so FinTech acquisitions which create capital deductions due to goodwill will be even harder

• Boards will push banks to improve efficiency and control costs, so FinTech M&A will not be on the table

But on the other hand, we might see increased activity of banks acquiring struggling/failing FinTech start-ups for the residual cost due to their tech base

• In the recession a lot of start-ups will have hard time and they will be up for fire-sale

• These types of acquisitions have less impact on banks capital adequacy due to their lower fire sale price, and are easier to get approved by boards

Combining both factors, I expect less FinTech/Tech acquisitions by banks.

As an update, since publication of original the post, 9 Banking-FinTech M&A have happened. Here is quick list (acquirer listed first):

Klarna - Moneymour; Ally Financial – CardWorks; Morgan Stanley – eTrade; Santander – Elavon Mexico; Greensill – Earned; Santander – Mercury TFS; Klarna – Nuji; ABHH – Anna Money; Societe Generale - Shine