Market comment on behalf of Sa
Saudi Arabia’s asset management industry is experiencing a period of significant expansion, cementing its status as the largest and most dynamic market within the GCC region. Assets Under Management (AUM) exceeded the SAR 1 trillion (approximately USD 266 billion) threshold in 2024, propelled by a 20% year-on-year growth. Projected AUM could surpass SAR 1.3 trillion (USD 350 billion) by 2026. This growth trajectory is substantially fueled by the Kingdom’s ambitious Vision 2030 economic diversification strategy, which seeks to curtail historical reliance on oil revenues by developing non-oil sectors, alongside the supportive Financial Sector Development Program.
While the current landscape is characterized by a dominance of domestic, bank-affiliated asset managers, which command a significant share of industry AUM and revenue, the competitive environment is growing to include prominent international firms, including BlackRock and Goldman Sachs, drawn by the Kingdom’s considerable market potential. The Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund targeting $2 trillion in assets by 2030, functions as both a major capital allocator to the industry and a powerful direct investor shaping the national economy via large-scale giga-projects like NEOM.
On the investment front, several key trends are actively reshaping strategies. A notable shift beyond traditional investments towards alternative assets, such as private equity, venture capital, and private credit, is complementing established real estate and stock holdings. Demand for Sharia-compliant products remains a fundamental market characteristic, influencing product development and asset selection criteria. Concurrently, Environmental, Social, and Governance (ESG) considerations are rapidly gaining prominence, driven by both global investor preferences and national strategic priorities embodied in initiatives like the Saudi Green Initiative.
Looking ahead, proactive regulatory reforms and market infrastructure enhancements spearheaded by the Capital Market Authority (CMA) aim to foster a more robust, efficient, and investor-friendly environment, underpinning continued sector growth.
