Senior finance executives gathered at the Farnborough Airshow in England on Monday, making the case that private investors must step up to cover the shortfall left by governments that simply don’t have enough money to meet surging European defence demands.
“Public spending will not be enough, and we do need to mobilise private capital at scale,” said Cathal Deasy, global co-head of investment banking at British bank Barclays. He urged national governments to move more quickly and offer clearer direction to potential investors.
The annual aerospace event is drawing bankers and investors in record numbers this year, according to organizers, with many attracted by the possibility of profiting from a worldwide surge in defence investment driven by rising geopolitical tensions.
Still, investor enthusiasm has pulled back in recent months. Defence company stock prices have weakened, and Franco-German defence group KNDS announced this month that it was delaying its planned stock market listing until market conditions become more favorable.
More than 600 finance professionals are expected to attend the Farnborough event — roughly three times the number from 2025 — including representatives from Goldman Sachs, JPMorgan, and Qatar’s sovereign wealth fund.
“With defence companies growing, banks see an opportunity to jump in,” said Amin Mansour, a vice chairman at Dutch bank ING. He told Reuters ahead of the event that the bank now has around 50 bankers across various sectors working on defence funding deals, compared to “very few” just five years ago.
The strong run that European defence stocks enjoyed has lost momentum in 2026. An index tracking aerospace and defence companies has risen just 1.3% since the beginning of the year, while the broader STOXX 600 index has climbed 8%.
An executive at one of the largest private equity firms in the United States, who chose not to be identified, said defence company valuations went through a “reckoning” over the past year but have since stabilized and become more attractive to investors.
Others at the event pointed out that many smaller defence contractors are still being left out of private investment opportunities, largely because of complicated government procurement processes.
“It’s getting the capital into the supply chain which is challenging and which does create bottlenecks,” said Ephraim Rudman, a financial institutions group partner at Apollo.
