Executives at Farnborough Airshow highlight need for private investment as government budgets fail to meet rising defence demand.
European defence executives are calling for private investors to inject capital into the sector, citing insufficient public funding amid growing geopolitical risks. Barclays’ global co-head of investment banking, Cathal Deasy, stressed the urgency of mobilizing private capital at scale, noting governments must act faster to provide clarity and remove investment barriers.
Finance delegates at the Farnborough Airshow surged to over 600 this year, nearly triple the 2025 figure, with banks like Goldman Sachs and JPMorgan increasing their defence-focused teams. However, investor sentiment has softened recently, with defence stocks underperforming and KNDS postponing its IPO due to market conditions.
Banks are expanding their defence financing units, with ING reporting a tenfold increase in dedicated bankers over five years. Despite the sector’s growth, executives warn that regulatory bottlenecks and unclear government policies remain key hurdles for private investment.