TLDR:
Saudi challenges UAE for investment fees
Riyadh outpaces UAE in IPO activity
UAE diversifies to stay competitive
RIYADH (The Thursday Times) — Saudi Arabia and the United Arab Emirates are locked in an intensifying competition for dominance in Middle Eastern investment banking. With Saudi Arabia’s Vision 2030 driving growth, the Kingdom has been channelling its resources to attract top-tier global financial firms to Riyadh, challenging Dubai’s long-held status as the region’s financial hub. This rivalry is reshaping the financial landscape in both countries, creating opportunities and challenges for regional and international players alike.
Saudi pushes Riyadh as a global financial centre
Saudi Arabia’s strategy revolves around leveraging its economic transformation and wealth to compel major firms to relocate their regional headquarters to Riyadh. The Ministry of Investment has been actively granting regional licences to multinational institutions, a move seen as a prerequisite for securing deals within the Kingdom. Recent approvals for firms like Citigroup highlight this trend, cementing Riyadh as a financial epicentre. This aggressive push aligns with Saudi Arabia’s unprecedented expansion in equity and debt markets, which have positioned the nation to surpass the UAE in investment banking fees this year.
UAE strengthens position
While Saudi Arabia capitalises on its scale and reforms, the UAE remains a formidable competitor. Dubai and Abu Dhabi have continued to attract global asset managers, private equity firms, and hedge funds, thanks to their well-established infrastructure and appeal to expatriate professionals. Notable moves include BlackRock’s commercial licence in Abu Dhabi and a rise in hedge fund activity in Dubai. The UAE’s ability to adapt to Saudi’s rise has bolstered its resilience, evidenced by strong IPO activity, including the upcoming Talabat listing in Dubai.
Investment banking fees reveal the race
Both Saudi Arabia and the UAE have witnessed record-breaking growth in investment banking fees. Saudi Arabia’s market, driven by sovereign deals such as Aramco’s return to debt markets and the Public Investment Fund’s share sale in Saudi Telecom, has outperformed in equity and debt issuance. The UAE, however, has remained competitive with diversified IPOs like Alef Education and Lulu Group, showcasing its capacity to attract private and state-backed issuers alike.
Emerging trends in debt and equity markets
As both countries race to build advanced capital markets, they are diversifying their offerings. Saudi Arabia is expanding its securitisation and repo markets, while also targeting equity derivatives. Meanwhile, the UAE focuses on diversifying its issuer base, aiming for greater private-sector participation in its listings. This competition, driven by Vision 2030 and the UAE’s strategic initiatives, is expected to sustain growth in regional capital markets, setting new benchmarks in financial innovation and integration.
