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GCC Mutual Fund Industry - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 130 Pages
  • June 2022
  • Region: Middle East
  • Mordor Intelligence
  • ID: 5529749
UP TO OFF until Sep 30th 2023
Dubai, which focuses on financial activities, was particularly badly impacted during the COVID-19 financial crisis, resulting in a near-default on its debt payments and a subsequent bailout by Abu Dhabi. Dubai, on the other hand, has begun a phase of sustained expansion, with large projects in the tourism and real estate industries, following several key restructurings and policy changes. These industries were heavily damaged by the covid-19 pandemic, and Dubai faced a terrible year in 2020; however, because to rapid and strong leadership, Dubai was one of the first countries to emerge and restore international travel, which the authorities and investors think would be a benefit to the economy.

GCC Asset Management Industry manages mutual fund assets of USD 55 billion as of December 2021. Assets under management (AuM)-to-GDP ratio for the mutual funds in GCC region stands at 3.3% compared to 33.3% global average, implying potential for growth of mutual fund industry in the region. GCC mutual fund asset management market is concentrated among the top asset management companies, with the top 10 asset managers (out of 74 managers) accounting for 83% of the total assets being managed

With many GCC-domiciled mutual funds investing in local equities, bonds or sukuk, and exclusively long the market, they typically need some degree of economic upswing and positive growth in stock markets or fixed income if investments are to grow.

Owing to GCC’s affinity with Islamic Finance the asset management industry has made significant progress in the area of Shariah-compliant funds, particularly in Saudi Arabia.

Mutual funds face difficulty in marketing and distribution to GCC nationals who are primarily reached through banks. AMCs often enjoy exclusive access to their parent bank's distribution network. This creates a situation where it is difficult for an AMC to compete if it does not have a network of bank branches.

Key Market Trends

Emerging Leadership of Saudi Arabia in GCC Capital Markets

In GCC, there are two active asset classes within the industry: Mutual Funds and Private Equity & Other Alternative Assets. Mutual funds are, by and large, a function of the size and growth of the regional capital markets. GCC equity markets underperformed global peers during 2021, reporting significantly lower gains during the year.

Saudi Tadawul has traditionally been the biggest market in the GCC region. This is not surprising considering the relative size of KSA’s economy. Qatar and UAE are placed next in the order. The Capital Markets Authority (CMA) in Saudi Arabia is also actively improving the regulatory framework for listing and corporate governance with a view to building more depth.

GCC Mutual Fund AuM By Fund Category

Asset gathering has been difficult in the region as seen from the low size of mutual fund AuM compared to the GDP, in spite of the abundant private wealth and liquidity. Equity mutual funds, the primary vehicle for asset gathering were hit hard by the global financial crisis of 2008 which led most investors to pull their money out and the industry has not recovered since then. Equity Funds are predominant in this region. Bond Funds are a relatively new product and since the GCC debt markets have only recently seen reforms, their size is also very small. Real estate funds, a popular choice of many GCC investors have given negative returns since 2015 and so have been unable to increase their AUM.

Competitive Landscape

The report includes an overview of MF companies operating across GCC. We wish to present detailed profiling of a few major companies which cover product offerings, regulations governing them, their headquarters, and financial performance. Currently, some of the major players dominating the market are listed below.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
  • 3 months of analyst support

This product will be delivered within 2 business days.

Table of Contents

1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
4.1 Market Overview
4.2 Prominence of Inslamic Funds in GCC Mutual Fund Industry
4.3 A Brief on Regulatory Environment
4.4 Insights on Various Types of Schemes or Funds Offered in Mutual Fund Industry
4.5 Technological Innovations Shaping The Industry
4.6 Market Drivers
4.7 Market Restraints
4.8 Porters Five Force Analysis
4.8.1 Threat of New Entrants
4.8.2 Bargaining Power of Buyers/Consumers
4.8.3 Bargaining Power of Suppliers
4.8.4 Threat of Substitute Products
4.8.5 Intensity of Competitive Rivalry
4.9 Impact of COVID-19 on the Market
5.1 By Fund Type
5.1.1 Equity
5.1.2 Money market
5.1.3 Real Estate
5.1.4 Others (Bond, Commodities, Mixed)
5.2 By Geography
5.2.1 Saudi Arabia
5.2.2 Qatar
5.2.3 Abu Dhabi
5.2.4 Kuwait
5.2.5 Dubai
6.1 Market Competition Overview (Market Concentration And M&A Deals)
6.2 Company Profiles
6.2.1 Riyad Capital
6.2.2 NCB Capital
6.2.3 Samba Capital & investment Management
6.2.4 HSBC Saudi Arabia Ltd
6.2.5 ANB Invest
6.2.6 Saudi Hollandi Capital
6.2.7 Al Rajhi Capital
6.2.8 Jadwa Investment
6.2.9 Caaam Saudi Fransi
6.2.10 BNP Paribas Asset Management*

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Riyad Capital
  • NCB Capital
  • Samba Capital & investment Management
  • HSBC Saudi Arabia Ltd
  • ANB Invest
  • Saudi Hollandi Capital
  • Al Rajhi Capital
  • Jadwa Investment
  • Caaam Saudi Fransi
  • BNP Paribas Asset Management*