CMA Chairman says asset management key focus in upcoming phase

Mohammed ElKuwaiz, Chairman of the Capital Market Authority (CMA)

Mohammed ElKuwaiz, Chairman of the Capital Market Authority (CMA), said the strength of the Saudi capital market showed a significant shift in its global development.

Speaking at a panel at Aseer Investment Forum on May 27, ElKuwaiz said the market is no longer viewed merely through the lens of investors, but also through the lens of entrepreneurs seeking funding.

As a result, the market currently plays a dual role in both investment and financing, he said.

ElKuwaiz added that the major leap witnessed by the capital market is evident in the remarkable increase in listings and offerings. In recent years, the number of listings in both the Main Market and Nomu-Parallel Market reached nearly 40 and 50. Thus, the local market ranked eighth in the world in terms of market capitalisation, as well as the size of offerings and listings.

He noted that the increase in listings was accompanied by diversity in sectors and corporate sizes, with 60% of listed companies in the market being small and medium-sized enterprises (SMEs).

The Chairman also pointed out that this development included the diversity of investment and financing tools. "Today, we’re talking about the stock market and the asset management industry, with investment funds surpassing SAR 1 trillion in assets under management (AUMS) in 2024."

The debt instruments sector and the debt market are now nearly equal in size to the asset management sector. Additionally, the diversity of investor categories —including local, individual, international, and institutional investors — contributes to greater market stability, ElKuwaiz said.

Saudi Arabia has the most mature stock market, and the next stages of development will focus on the asset management industry, which surpassed SAR 1 trillion, equivalent to roughly one-tenth of the local stock market capitalisation of SAR 10 trillion.

This demonstrates the significant growth potential for this sector in the coming period, whether in traditional assets such as equity and bond funds, real estate funds, or venture capital funds.

The Chairman stated the debt market in the Kingdom is smaller than the capital market, amounting to nearly SAR 1 trillion, compared to the equity market.

However, in the past two years, the volume of financing through the debt market surpassed financing in the capital market, reflecting enormous upcoming financing opportunities, he said.