Saudi Arabia grants operator license for 1st international marina to Jeddah yacht club
Updated 26 November 2024
MOHAMMED AL-KINANI
JEDDAH: Saudi Arabia has granted an operator license for its first international harbour to Jeddah Yacht Club and Marina, boosting tourism and strengthening its position as a leading regional and global maritime hub.
On Nov. 26, the Saudi Red Sea Authority announced that it had submitted the license to the organization, which is owned by Sela, a company under the Public Investment Fund.
Mohammed Bukhari, vice president of the coastal tourism operations at SRSA, presented the license to Amer Daggag, head of destinations at Sela, at the headquarters of the Jeddah-based club.
In line with the Kingdom’s Vision 2030, the authority began working in 2021 to develop and regulate the coastal tourism sector.
Its efforts include issuing licenses and permits, creating policies and strategies, and assessing infrastructure needs, as well as preserving the marine environment, attracting investments, and promoting navigational and marine tourism activities.
In a statement, SRSA said the move is part of its efforts to develop a thriving coastal tourism sector by issuing licenses and permits and establishing guidelines, rules, and standards for marinas’ development, management, and operation.
The release added that the initiative aims to encourage participation in these activities, attract and support investors, and promote coastal tourism projects along the Red Sea.
In May, SRSA granted licenses for three tourist marinas: the Al-Ahlam Marina in Jeddah, the Al-Ahlam Marina in Jazan, and the Red Sea Marina in Jeddah.
The authority emphasized that regulating marina operations would enhance the quality of services for tourists and visitors while protecting and sustaining the marine environment, emphasizing that these operators must adhere to international standards to obtain their licenses.
SRSA also issued its first maritime tourism agent license to Cruise Saudi, a company owned by PIF, as part of its broader role in enabling tourism.
The licensed agent was stated to provide services to yachts and cruise ships, ensuring the sustainable development of marine tourism and facilitating vessel movements within the Kingdom’s waters in accordance with the highest environmental standards and practices.
Last year, the Saudi Sailing Federation and Sela signed a memorandum of understanding at JYC to enhance cooperation between the two parties. Under the agreement, Sela committed to providing consultancy services and logistical support for SSF events and activities held at the Jeddah Yacht Club and Marina.
Sela also agreed to collaborate with SSF to establish a strategic partnership to manage races and events at JYC. The agreement allows SSF to benefit from the JYC training academy, offering educational programs for those seeking to develop their sailing skills.
In December 2023, JYC hosted the first America’s Cup race on the Red Sea, which was attended by Prince Abdulaziz bin Turki Al-Faisal, minister of sport, along with dignitaries from across the Kingdom, the world’s top professional sailors, and global enthusiasts.
Population growth, regulatory reforms and tourism reshaping Saudi real estate sector, experts say
Updated 23 sec ago
Nirmal Narayanan
RIYADH: Saudi Arabia’s real estate sector is poised for robust expansion thanks to an increasing population, growth in the tourism industry, and friendly government policies and regulatory reforms, experts told Arab News.
The Kingdom’s Real Estate General Authority expects the property market to reach $101.62 billion by 2029, with an anticipated compound annual growth rate of 8 percent from 2024.
Strengthening this sector is crucial for Saudi Arabia as it seeks to position itself as a global hub for tourism and business, by reducing its decades-old reliance on crude revenues.
Speaking to Arab News, Matthew Green, head of research at CBRE in the Middle East and North Africa region, said that the expansion of the Kingdom’s real estate market is also influenced by various other factors including rapid urbanization, infrastructure development, and the rise in foreign direct investments.
“Saudi Arabia’s real estate market is supported primarily by the government’s aggressive investment program, particularly toward the giga-projects, which is driving non-oil production, fueling employment and population growth, and attracting FDI,” said Green.
He added: “The country’s supportive demographics, which are characterized by the presence of a significant young and well-educated population, increasingly liberalized, and a rising middle class with greater disposable income levels than previous generations is also driving the growth of the real estate market in the Kingdom.”
CaptionMatthew Green, head of research at CBRE in the Middle East and North Africa region. Supplied
Saud Al-Sulaimani, country head of JLL in Saudi Arabia, echoed those views and said that government policies, including the Sakani program and Real Estate Investment Trusts — as well as new mortgage laws and foreign ownership regulations — are propelling the growth of the property sector.
“Sakani program supports home ownership by providing financial aid and land to Saudi citizens, while REITs encourage institutional investment in the sector,” he said.
“Relaxed ownership laws are making the Kingdom’s real estate market more attractive to international investors. All these factors are driving the growth of the real estate sector in the Kingdom.”
Founded in 2017 by the Saudi Ministry of Housing and the Real Estate Development Fund, the program aims to increase the proportion of families that own a home in the Kingdom to 70 percent by 2030, in line with the economic diversification strategy Vision 2030.
In January, Saudi Arabia’s Capital Market Authority approved foreigners to invest in Saudi-listed companies owning real estate in Makkah and Madinah.
Effective from Jan. 27, the amendment aims to boost the capital market’s competitiveness and align with the Vision 2030 economic diversification objectives, the authority said in a statement.
“The landmark change to allow international investors to access the property markets in the Holy Cities through listed companies, announced this week, will help to begin addressing the pent-up demand from international investors hungry to access real estate markets in the Kingdom’s Holy Cities,” Faisal Durrani, head of research at Knight Frank, told Arab News.
He added: “This change in investor rules, combined with last January’s introduction of Premium Residency Visas, one of which is connected to property ownership, is a clear indication of the direction of travel and the strongest hint yet of authorities’ plans around boosting inward international real estate investment.”
Faisal Durrani, head of research at Knight Frank. Supplied
Susan Amawi, general manager of Knight Frank in Saudi Arabia, said that construction activities in Saudi Arabia are expected to rise in the coming years with the Kingdom targeting to deliver 1.04 million homes by the end of the decade.
“Government programs such as Wafi and Sakani have pushed the national homeownership rate to around 64 percent; however surging home values are testing the limits of affordability. With plans underway to deliver 1.04 million homes across the country by 2030, we expect to see a significant ramping up in construction activity and jobs as the 2030 deadline nears,” said Amawi.
Regional headquarters program driving growth
Al-Sulaimani told Arab News that the regional headquarters program is one of the crucial factors acting as a catalyst for growth of the commercial real estate sector in the Kingdom.
“The program has led to increased demand for high-quality office spaces and mixed-use developments, spurring investments across key industries, including offices, hospitality, and data centers,” he said.
The JLL official added: “This influx of international businesses is reshaping real estate dynamics, with an increased focus on smart technologies, sustainability, and specialized assets, creating a thriving environment for global talent.”
Saudi Arabia’s Minister of Investment Khalid Al-Falih presented IBM executives with a regional HQ license in April 2024. IBM
Knight Frank’s Amawi said that the strong economic growth in the Kingdom, combined with the regional headquarters program has driven up demand levels for premium office space, while vacancy rates have approached record lows of around 2 percent in Riyadh.
“Office rents for Grade A space in Riyadh too have responded to the sharp upturn in occupier requirements, rising by 51 percent in the last three years alone,” said Amawi.
Real estate and tourism
Durrani said that Saudi Arabia’s ambition to attract more than 150 million visitors by the end of the decade is creating several opportunities in the hospitality real estate sector.
“For domestic tourism to flourish in Saudi Arabia, care and attention must be paid to the development of attractions in secondary and tertiary cities if they are to compete and thrive alongside all the new giga-project hospitality offerings,” he said.
Durrani added that cost-effective accommodation facilities are needed to meet the demand of travelers and address the issue of expensive stays.
“With 28 percent of Gen Z Saudis highlighting high costs as a barrier to domestic travel … so there remains an opportunity to develop more cost-effective accommodation options,” added Durrani.
Green of CBRE echoed similar views and said that diverse accommodation options are crucial to strengthening the real estate sector in the Kingdom.
He flagged the need for a mix of hotel rooms, long stay suites, private unit rentals — such as Airbnb — as well as lower cost hostels and other budget-friendly room options.
Al-Sulaimani said that the launch of high-profile and futuristic mega and giga-projects attracted global attention and investments, and symbolizes a progressive shift in Saudi urban development.
“The focus on tourism and entertainment, alongside massive investments in infrastructure, from transportation to utilities and logistics, are creating a more conducive environment for real estate development,” said the JLL official.
Real estate and technology
Al-Sulaimani added that the adoption of new technologies and digital solutions is critical to streamlining operations and boosting the efficiency of the Saudi property landscape.
He said advanced technologies to create smart, sustainable, and highly efficient urban environments are fueling innovations and unlocking new growth opportunities for property tech in the Kingdom.
“Companies can leverage AI and data analytics to enhance transparency, improve decision-making, and predict market trends. The development of smart cities focuses on integrating IoT and sustainable technologies, offering residents an improved quality of life,” said Al-Sulaimani.
Green shared that view, and said improving customer experience and service through technology adoption should be a key target for all companies operating in the real estate sector.
“In the context of the real estate market, the use of virtual and augmented reality for property tours and AI-powered chatbots for instant support and more personalized feedback are becoming more common globally but continue to lag in parts of the region,” said Green.
He added: “In addition, generating efficiencies and streamlining operations through use of property management software and better integration of smart building technologies can also enhance property value and tenant comfort.”
Uniqueness of Saudi Arabia’s real estate sector
Speaking with Arab News, experts unanimously highlighted the uniqueness of the housing sector in Saudi Arabia.
“The Kingdom’s real estate market is one of the fastest growing globally and certainly of the most exciting. The opportunity for investors continues to grow as the government unveils ever more ambitious projects, designed to spur economic growth in the non-oil sector and to also showcase Saudi Arabia’s arrival on the global investment stage,” said Amawi.
Green said that the ongoing construction of giga-projects gives the Kingdom’s real estate sector an upper hand compared to other countries in the region.
The CBRE official added that Saudi Arabia’s rich cultural heritage is also a further standout for tourism-related developments, creating a unique opportunity to establish a tangible cultural tourism offering in the region.
“The size and scale of the Saudi’s giga-projects remain a notable differential against other regional markets, with the Kingdom still very much in its nation-building stage against more mature real estate markets in the UAE,” said Green.
Intersection between family offices and early-stage startups poised to expand, experts say
Updated 53 min 41 sec ago
Nour El-Shaeri
RIYADH: Family offices have traditionally been influential in private capital investment, but their role in business funding and early-stage startups has often remained under the radar.
Historically, these entities have prioritized wealth preservation, stability, and strategic investments aligned with their company interests.
A shift is underway, however, with family offices increasing their exposure to venture capital through direct investments, fund allocations, and partnerships with startup incubators.
Family offices across the Middle East and North Africa are recalibrating their investment strategies, emphasizing stability and selective diversification, according to a Campden Wealth and HSBC Global Private Banking report.
Real estate remains a dominant asset class, accounting for 34 percent of portfolios and showing a net increase in interest of 44 percent, which reflects the difference between the share of family offices planning to raise their holdings and those intending to reduce them, demonstrating strong momentum in property investments.
Bonds and commodities are also gaining traction, with net increases in interest of 33 percent and 50 percent, respectively, as family offices prioritize reliable asset classes amid global economic uncertainties.
In contrast, MENA family groups show a limited appetite for expanding their exposure to private equity or debt, with minimal net change reported in these categories.
This stands in stark contrast to family offices in Europe and North America, where private equity remains a primary focus.
Despite the restrained interest in private equity overall, 58 percent of MENA family groups are active in VC, favoring early-stage investments such as angel and seed funding at 50 percent, as well as growth-stage opportunities at 50 percent.
The findings reflect a measured approach, balancing traditional, stable investments with selective forays into innovation-driven sectors.
Paula Tavangar, chief investment officer at Injaz Capital, a regional investment firm, believes that the shift is moving quickly.
In an interview with Arab News, Tavangar emphasized that Saudi family offices are increasingly expanding beyond traditional asset classes and recognizing VC as a key investment opportunity.
“With above half already investing in early-stage companies, this shift is well underway,” she said. However, she noted that while many family offices seek direct access to promising early-stage investments, they often lack the infrastructure to efficiently evaluate and structure deals.
This shift in investment strategy is driven in part by second-generation family office leaders who are more innovation-focused.
Paula Tavangar, chief investment officer at Injaz Capital. Supplied
“They seek exposure to both local and global early-stage opportunities, whether through setting up their own shop, being an LP (limited partner) in VC funds, or mandating external experts like us,” Tavangar said.
Injaz Capital has been actively sourcing and reviewing deals for family offices in both early- and growth-stage investments in Saudi Arabia. “For example, we invested in the latest round of Xpence, a smart business spend platform,” she said.
While fintech and e-commerce have traditionally dominated Saudi VC, Tavangar noted these sectors are becoming saturated.
Family offices are shifting toward industries aligned with their core businesses and national priorities, including deep tech, renewables, and health tech.
“Healthcare spending is expected to total $180 billion by 2029, with increasing incentives for private investment,” she said, citing a $10 billion localization gap in the Kingdom’s pharmaceuticals and medical devices sector.
Injaz Capital is addressing this through MENA Hayah, its health tech-focused investment platform.
The relationship between family offices and VC firms is changing. Currently, about 70 percent of these groups in MENA source deals through their own networks instead of investing in VC funds, but this trend is shifting.
“As the Saudi startup ecosystem matures, family offices are increasingly exploring structured partnerships with VC firms,” Tavangar said. Many prefer co-investment models in late-seed and series A+ rounds over traditional fund commitments.
Large family groups are also launching sector-specific investment arms and collaborating with specialized VCs to gain proprietary deal flow and expertise.
“The goal is not just to follow an investment trend but to help build an environment where family offices can contribute meaningfully to economic growth while effectively managing risk,” Tavangar added.
Speaking with Arab News, Thomas Kuruvilla, managing partner of Arthur D. Little Middle East and India, explained that family offices have typically avoided VC due to their preference for control and long-term investment horizons.
“Minority stakes in VC funds often fail to provide this comfort,” he noted. VC firms tend to focus on short-term portfolio diversification and exit strategies, whereas family offices emphasize stability.
Additionally, many family groups have been cautious about early-stage investments because generating quick returns often contradicts the values they seek to instill in future generations.
CaptionThomas Kuruvilla, managing partner of Arthur D. Little Middle East and India. Supplied
Kuruvilla highlighted several factors driving a change in approach, adding: “Younger family members are more tech-savvy and comfortable investing in emerging technologies.”
Furthermore, portfolio diversification is becoming a priority, with family offices seeking access to disruptive business models and new technologies.
Reputation building is also a motivator, as participation in prestigious VC funds enhances their credibility as serious venture investors.
As a result, family offices are becoming major players in VC, offering long-term perspectives, sector expertise, and capital beyond mere financial investment.
Speaking to Arab News, Achal Aroura, head of multi-family office EMEA at Klay Capital Limited, highlighted that many family offices have been investing in startups for years.
However, these investments often go unnoticed because they are structured as bilateral rather than traditional VC transactions.
“The reason they go unnoticed is that these investments are not seen as traditional venture capital investments, but rather strategic investments made by these families and their existing businesses,” he explained.
He added that firms like Klay are helping family offices take a more institutionalized approach, facilitating early-stage investments through venture funds, direct deals, and collaborations with startup incubators.
Family offices tend to invest in industries that align with their broader investment goals and expertise.
Kuruvilla identifies real estate, artificial intelligence, and healthcare, as well as biotechnology, renewable energy, and fintech as key areas of interest.
“Many Middle Eastern family offices incorporate Islamic finance principles, ensuring compliance with ethical and religious guidelines,” he added.
Aroura echoed these observations, noting a focus on technology-enabled startups in real estate, finance, and consumer sectors.
“Lately, we have seen a lot of interest in data centers and AI-enabled startups and businesses,” he said.
Obediah Ayton, chairman of Dhabi Hold Co., provided a contrasting perspective, explaining that family holdings — common in the UAE — differ from family offices in their investment approach.
“A family office typically invests in liquid strategies or acts as LPs in VC funds,” he told Arab News.
In contrast, family holdings deploy capital directly from the business level, which can lead to frustration around the speed of investment decisions.
Ayton explained that startups approaching family holdings or offices typically need to demonstrate alignment with the family’s business interests, such as solving an operational problem or reducing supply chain costs.
“The times we have seen investment is normally by an Al-Futtaim investing in mobility — why? Because eventually, they want local distribution or vice versa, to expand their own products through that vertical into new markets,” he said.
Obediah Ayton, chairman of Dhabi Hold Co. Supplied
Ayton also emphasizes that family offices rarely lead funding rounds due to a lack of in-house capabilities and risk appetite. Instead, they prefer to see reputable investors already involved.
“Sitting on a cap table rarely happens, and if they do, they want to see good names that priced the business and revenues,” he explained. “If a startup with no revenue comes along, as opposed to a startup with known investors, I know which one is better for my job security within the family business.”
To optimize their participation in VC, family offices are adopting various strategies. Kuruvilla suggests leveraging their industry knowledge and entrepreneurial experience to support portfolio companies.
Direct investments allow for greater control, while partnerships with VC firms enhance due diligence. He also noted the growing involvement of younger family members, which introduces fresh perspectives and ensures long-term commitment to venture investing.
Aroura outlined three primary ways family offices are engaging in startups: “Through early-stage venture capital funds, direct seed investments with founders, and through early-stage incubators from within the venture capital ecosystem.”
These approaches provide a balance between institutional expertise, direct influence, and exposure to high-growth startups.
The intersection between family offices and VC firms is also evolving. Kuruvilla highlights increased capital allocations to alternative assets, including co-investment opportunities that offer access to high-quality deal flow and shared risk management.
“Family offices offer patient capital, ideal for emerging technologies and industries requiring substantial upfront investment,” he said.
Sector expertise also plays a role, as family offices that leverage their industry knowledge tend to achieve better growth outcomes. Additionally, a focus on impact investing is emerging, particularly among younger generations who prioritize sustainability and social good.
Aroura emphasized that VC funds bring an institutional approach to early-stage investing, helping family offices diversify their risk while accessing a curated portfolio of startups.
“Family offices are starting to support venture capital funds, as these funds bring experience and an institutional approach to building a portfolio of companies that helps to diversify their risk of investing in early-stage startups,” he explained.
SINGAPORE: Oil prices rebounded on Friday to recover some of their losses of more than 1 percent in the previous session, partly due to the diminishing prospects of a quick end to the Ukraine war that could bring back more Russian energy supplies.
Brent crude futures rose 70 cents, or 1 percent, to $70.58 a barrel by 9:50 a.m. Saudi time after settling 1.5 percent lower in the previous session. US West Texas Intermediate crude was at $67.28 a barrel, up 73 cents, or 1.1 percent, after closing down 1.7 percent on Thursday.
Russian President Vladimir Putin said on Thursday that Moscow supported a US proposal for a ceasefire in Ukraine in principle, but sought a number of clarifications and conditions that appeared to rule out a quick end to the fighting.
“Russia’s tepid support of a 30-day ceasefire proposal with Ukraine has reduced confidence around a ceasefire in the short term,” IG market analyst Tony Sycamore said.
“The feeling is that US won’t lift sanctions until they agree a ceasefire.”
However, the global trade war that has roiled financial markets and raised recession fears is escalating with US President Donald Trump on Thursday threatening to slap a 200 percent tariff on wine, cognac and other alcohol imports from Europe.
The International Energy Agency warned on Thursday that global oil supply could exceed demand by around 600,000 barrels per day this year, due to growth led by the United States and weaker than expected global demand.
“The macroeconomic conditions that underpin our oil demand projections deteriorated over the past month as trade tensions escalated between the US and several other countries,” the IEA said, prompting it to revise down its demand growth estimates for the fourth quarter of 2024 and the first quarter of 2025.
The Trump-driven trade war woes and demand worries dented oil prices on the previous day, though the possibility of less Russian oil in the global markets in the near term provided some cushion during Friday’s trade.
“Most price projections were to the downside in the short term, but geopolitical tension could still cause supply disruptions,” ANZ analysts said in a note to clients.
On Friday, China and Russia stood by Iran after the US demanded nuclear talks with Tehran, with senior Chinese and Russian diplomats saying dialogue should only resume based on “mutual respect” and all sanctions ought to be lifted.
This comes a day after Washington stepped up sanctions, including on Iran Oil Minister Mohsen Paknejad.
Closing Bell: Saudi main index closes in green at 11,725
Updated 13 March 2025
Miguel Hadchity
RIYADH: Saudi Arabia’s Tadawul All Share Index gained 20.95 points, or 0.18 percent, closing at 11,725.88 on Thursday. The total trading volume for the benchmark index reached SR6.20 billion ($1.65 billion), with 141 stocks advancing and 94 declining.
The MSCI Tadawul Index also saw an increase, rising by 2.36 points, or 0.16 percent, to close at 1,479.27.
In contrast, the Kingdom’s parallel market, Nomu, slipped by 37.56 points, or 0.12 percent, closing at 31,135.85. This decline came as 54 stocks rose, while 29 saw a decrease.
The top-performing stock of the day was Rasan Information Technology Co., which saw its share price surge by 9.87 percent to SR79.
Other strong performers included Saudi Chemical Co., whose share price climbed by 5.89 percent to SR8.45, and Saudi Research and Media Group, which gained 5.66 percent, reaching SR175.60.
On the other hand, Nice One Beauty Digital Marketing Co. was the worst performer, with its share price dropping by 4.99 percent to SR40.90.
National Shipping Co. of Saudi Arabia and Alandalus Property Co. also faced declines, with their shares falling by 4.29 percent and 3.55 percent, respectively, to SR29 and SR23.90.
On the announcements front, First Milling Co. reported a net profit of SR250.9 million for 2024, marking a 13.9 percent increase compared to the previous year.
The company attributed this growth to higher sales, improved product mixes and pricing, as well as the introduction of new products.
Additionally, continued growth in small-pack goods, which offer higher profit margins, alongside efficiency improvements, cost leadership, and enhanced cash management, contributed to the rise, with increased interest income from Shariah-compliant Murabaha deposits.
Despite the positive results, First Milling Co.’s share price remained unchanged at SR60.90 during today’s trading.
Umm Al-Qura Cement Co. also reported impressive results, with a net profit of SR47.7 million for 2024, a staggering 1,107 percent increase from the previous year’s SR3.9 million.
This growth was driven by higher sales volumes and values, as well as reductions in administrative expenses, financing costs, and zakat. Despite the strong performance, the company’s shares fell by 1.98 percent, closing at SR18.78.
Lastly, ADES Holding Co. announced that it had received a Shariah Evaluation Report confirming its compliance with Islamic guidelines for the year ending Dec. 31.
The report, issued by the Shariyah Review Bureau, affirmed that the company’s activities aligned with Shariah standards. ADES Holding’s shares closed 0.74 percent lower on the main market at SR16.10.
RIYADH: Saudi Arabia’s money supply climbed to SR2.97 trillion ($791 billion) in January, marking a 9 percent annual rise, official data showed.
According to figures from the Saudi Central Bank, known as SAMA, demand deposits accounted for 48.75 percent of the total, reaching SR1.45 trillion. While still below the April 2021 peak of 60.21 percent, they edged up from 48.42 percent a year ago, reflecting shifting monetary conditions.
Demand deposits are a crucial part of the money supply. When individuals deposit money into checking accounts, it increases the total amount of demand deposits, thereby expanding the overall money supply in the economy.
A demand deposit refers to money held in a bank account that can be withdrawn at any time, whenever the account holder requires it.
These funds are generally used for everyday expenses. Banks or financial institutions typically offer little to no interest on the balance in a demand deposit account.
Time and savings deposits — which surged during the US Federal Reserve’s aggressive rate hikes, mirrored by Saudi Arabia due to the riyal’s peg to the US dollar — reached SR985.03 billion in January, accounting for 33.21 percent of total deposits.
As the Fed began easing monetary policy in September, lowering interest rates from their 6 percent peak to 5 percent by December, time deposits started to decline from their 33.61 percent high in November.
This shift reflects a gradual return to shorter-term deposit preferences as rate-sensitive accounts adjust to a lower-yield environment.
The third-largest category, other quasi-money deposits — including residents’ foreign currency accounts, marginal deposits for letters of credit, outstanding remittances, and bank repo transactions with the private sector — stood at SR301.28 billion, making up 10.16 percent of total deposits. Currency outside banks totaled SR233.71 billion.
Over the past two years, the Fed’s aggressive rate hikes aimed at curbing inflation led to a rise in term deposits as customers sought higher-yielding accounts, but with benchmark rates now easing, demand deposits have started to regain share.
Despite the 9 percent annual rise in money supply, deposit growth continues to lag behind bank lending, which surged 14.66 percent during the same period to exceed SR3 trillion for the first time. This growth has been driven by corporate credit expansion, particularly in real estate, infrastructure, and other key Vision 2030 sectors.
As deposit inflows moderate, Saudi banks have increasingly turned to external borrowing to bridge funding gaps. Recent issuances of euro-denominated bonds highlight the evolving financing landscape, with the debt capital market playing an increasingly pivotal role.
Speaking at the Capital Markets Forum 2025 in Riyadh in February, Mohammad Al-Faadhel, assistant deputy of financing at the Capital Market Authority, highlighted how Vision 2030 has transformed Saudi Arabia from a capital exporter to a credit-driven market, accelerating debt market growth.
Al-Faadhel noted that the Sukuk and Development Capital Market Committee was established in collaboration with key stakeholders to remove obstacles and support market expansion.
With ongoing structural reforms, Saudi Arabia’s financial ecosystem is evolving rapidly, setting the stage for continued growth in capital markets, corporate lending, and alternative financing mechanisms under Vision 2030.
Loan-to-deposit ratio holds steady
Saudi Arabia’s loan-to-deposit ratio rose to 82.78 percent in January, up from 80.05 percent in the same month last year, yet slightly lower than December’s 83.24 percent, according to SAMA data.
The LDR, a key banking metric, measures the proportion of loans issued by banks relative to their total deposits, indicating liquidity levels and lending capacity.
The increase over the past year reflects strong credit demand, particularly from corporate borrowers in key Vision 2030 sectors such as real estate, infrastructure, and industrial expansion.
However, the slight month-on-month decline suggests a stabilization in lending activity, as banks balance loan issuance with available deposit inflows. Despite the surge in credit, the LDR remains well below the regulatory cap of 90 percent, ensuring ample liquidity and financial stability within the banking system.
This ratio is closely monitored by regulators and investors as it influences banks’ ability to extend new loans while maintaining a healthy funding base.
