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Bailey McCann, Opalesque New York:

Private equity and venture capital are pulling back from investments in certain sectors as market volatility increases.

Banking sector under pressure

According to data from S&P Global, global private equity and venture capital investments in the banking sector dropped in 2022. Aggregate transaction value stood at $2.03 billion in 2022, down 63.5% from $5.57 billion the previous year, according to S&P Global Market Intelligence data. The number of transactions also fell to 59 from 70 in 2021.

So far in 2023, private equity and venture capital firms have announced just five deals in the banking sector totaling $110 million in transaction value. S&P analysts suggest that a realignment in the banking sector following the collapse of Silicon Valley Bank could present new opportunities for M&A, but it's also likely to come with new regulatory scrutiny, which could limit the types of deals that get done.

Climate tech takes a hit

Data from PitchBook shows that venture capital is also backing away from new investments in climate tech companies. Until now, those companies had been able to avoid the slowdown happening across the tech sector.

In the first quarter of this year, climate tech startups saw a 36% decline in deal value and a ......................

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