US Institutions Expand Footprint in Saudi Financial Sector, Nearing a Third of Total Foreign Holdings 

A man walks past the logo of Tadawul. (AFP)
A man walks past the logo of Tadawul. (AFP)
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US Institutions Expand Footprint in Saudi Financial Sector, Nearing a Third of Total Foreign Holdings 

A man walks past the logo of Tadawul. (AFP)
A man walks past the logo of Tadawul. (AFP)

Prince Mohammed bin Salman, Saudi Crown Prince and Prime Minister, arrived in Washington on Tuesday for talks with President Donald Trump and a Saudi-US investment summit, reinforcing the strategic weight of the financial partnership between the two countries, which is an essential pillar of Saudi Vision 2030.

The Crown Prince’s trip is not merely a diplomatic engagement; it reflects the deepening economic cooperation aimed at transforming Saudi Arabia into a global financial center. Today, 17 major US financial institutions operate in the Saudi market, making the United States one of the Kingdom’s most influential strategic partners in the sector.

Saudi officials say this cooperation has helped lift the value of the Saudi financial market to over USD 3 trillion by 2024. US institutions now account for nearly 30 percent of foreign investment in the sector.

Saudi Arabia began gradually opening its financial markets to foreign investors in 2015, introducing the Qualified Foreign Investor (QFI) framework. Momentum accelerated in 2019, when Tadawul was added to the MSCI and FTSE Russell emerging-market indices, attracting tens of billions of dollars in passive inflows.

Reforms under Vision 2030 helped modernize market regulations, increase transparency, and encourage foreign institutional participation. Key initiatives include the launch of the Fintech Regulatory Sandbox in 2019 and the introduction of financial derivatives trading in 2020, both aimed at enhancing liquidity and reducing volatility while opening the door to advanced global market players.

As a result, US institutional participation expanded significantly, reaching about 30 percent of total foreign exposure to Saudi financial instruments.

Critical role

American institutions have played a critical role in developing the Saudi capital market through direct investment, knowledge transfer, support for liquidity, corporate-governance modernization, and infrastructure development. Their presence has strengthened market depth and increased the appeal of Saudi assets to global investors.

Cooperation with US banks has also bolstered Saudi Arabia’s exchange-traded funds (ETF) ecosystem and strengthened the Kingdom’s debt market, supported in part through partnerships with the Public Investment Fund (PIF). This has boosted foreign focus on Saudi bonds and contributed to deeper fixed-income markets.

US institutions were also instrumental in landmark market events, including the 2019 Aramco IPO, valued at USD 29.4 billion, the world’s largest public offering at the time. Related reforms and advisory support helped drive a 110 percent increase in foreign investment in 2018.

Saudi Arabia’s Capital Market Authority (CMA) has also benefited from US expertise in areas such as mergers and acquisitions, market-making regulations, and strategies to reduce volatility and strengthen market stability.

Liquidity, governance and financial inclusion

The growing partnership has elevated performance standards and transparency across the Saudi financial sector.

Enhanced liquidity and improved governance practices, ranging from risk-management frameworks to anti-financial-crime systems, have contributed to the rise of banking assets across Gulf Cooperation Council countries to USD 2.3 trillion.

Higher governance standards have also helped Saudi Arabia improve its financial inclusion index score to more than 60 points, according to the International Monetary Fund.

Leading US institutions operating in Saudi Arabia:

Several major US firms are now deeply embedded in the Saudi financial landscape, reflecting long-term commitments to the Kingdom’s economic transformation.

BlackRock

Global asset-management giant BlackRock has established one of the strongest presences in Riyadh among foreign financial institutions. It was the first major global investment manager to open a regional office in the Saudi capital and last year added Amin Nasser, CEO of Saudi Aramco, to its board of directors.

In 2024, BlackRock signed an MoU with the Public Investment Fund to establish a multibillion-dollar multi-asset investment platform in Riyadh, backed by an initial USD 5 billion commitment from PIF.

During the Future Investment Initiative (FII) last October, BlackRock and PIF announced a series of new joint investment funds through the BlackRock Riyadh Investment Management Platform, open to both domestic and international investors.

J.P. Morgan

J.P. Morgan, the largest US bank by assets, remains a key financial partner to Saudi Arabia. It holds two operating licenses in the Kingdom: a banking license from the Saudi Central Bank (SAMA) and a securities license from the Capital Market Authority.

The bank is active in advisory, asset management, and capital-markets activities, and continues to expand its role in both public- and private-sector financing.

Morgan Stanley

Morgan Stanley leverages its extensive expertise to enhance the global appeal of Saudi public offerings. The firm has participated in advising and managing several IPOs, including the upcoming listing of SITE, a PIF subsidiary.

In September, Tadawul Saudi Exchange approved the request submitted by Morgan Stanley Saudi Arabia to operate as a market maker on 52 listed stocks across both the Main Market and the Parallel Market (Nomu). The move enables the exchange to benefit from the firm’s technical capabilities, improve overall market efficiency, and narrow bid-ask spreads.



US Stocks Dip on Mixed Earnings as Markets Monitor Iran

A trader works on the floor of the New York Stock Exchange (NYSE) at the opening bell in New York on March 24, 2026.  (Photo by ANGELA WEISS / AFP)
A trader works on the floor of the New York Stock Exchange (NYSE) at the opening bell in New York on March 24, 2026. (Photo by ANGELA WEISS / AFP)
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US Stocks Dip on Mixed Earnings as Markets Monitor Iran

A trader works on the floor of the New York Stock Exchange (NYSE) at the opening bell in New York on March 24, 2026.  (Photo by ANGELA WEISS / AFP)
A trader works on the floor of the New York Stock Exchange (NYSE) at the opening bell in New York on March 24, 2026. (Photo by ANGELA WEISS / AFP)

Wall Street stocks retreated from records early Thursday as markets digested a trove of mixed earnings reports and monitored the latest dynamics between the United States and Iran.

Analysts cited profit-taking after both the S&P 500 and Nasdaq shrugged off a jump in oil prices to finish at records on Wednesday.

About 10 minutes into trading, the Dow Jones Industrial Average was down 0.4 percent at 49,311.39, AFP reported.

The broad-based S&P 500 dipped 0.2 percent to 7,126.19, while the tech-rich Nasdaq Composite Index declined 0.3 percent to 24,588.07.

David Morrison, senior market analyst at FCA, called Thursday's early trading action "a mild bout of profit-taking triggered by some worrying reports of hostile action between the US and Iran," according to a note.

The US Defense Department said its forces boarded a vessel in the Indian Ocean that was transporting oil from Iran, while President Donald Trump announced on social media that he ordered the Navy to "shoot and kill" boats placing mines in the Strait of Hormuz.

Iran vowed it would keep the strait closed to all but a trickle of approved vessels for as long as the United States blockaded its ports.

Among companies reporting results, Tesla fell 1.7 percent and Lockheed Martin dropped 3.7 percent, while American Airlines jumped 4.9 percent.


What Does the Inclusion of Saudi Bonds in the J.P. Morgan Index Mean?

Saudi woman walks at the Saudi stock market in Riyadh - Reuters
Saudi woman walks at the Saudi stock market in Riyadh - Reuters
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What Does the Inclusion of Saudi Bonds in the J.P. Morgan Index Mean?

Saudi woman walks at the Saudi stock market in Riyadh - Reuters
Saudi woman walks at the Saudi stock market in Riyadh - Reuters

Saudi Arabia’s debt market is set for a strategic shift in early 2027, following J.P. Morgan’s announcement that local-currency bonds will be included in its global emerging markets bond index. The move represents a vote of confidence in the Kingdom’s structural reforms and is expected to open the door to substantial capital inflows that will help finance major economic transformation projects.

In a note, J.P. Morgan said the move follows a series of reforms to improve foreign investor access and enhance local market capabilities.

The bank added that Saudi sukuk, Shariah-compliant debt instruments that function similarly to bonds, with a remaining maturity of up to 15 years, will be eligible for inclusion in the Government Bond Index-Emerging Markets (GBI-EM), the most widely tracked benchmark of its kind, with $233 billion in assets tracking it.

J.P. Morgan said eight sukuk issues would be eligible for inclusion, with a total value of $69 billion.

The Kingdom’s inclusion in the index is expected to boost liquidity and demand for sovereign debt, contributing to lower borrowing costs.

In September, J.P. Morgan had placed Saudi Arabia on “Positive Index Watch,” paving the way for its eventual inclusion in the GBI-EM.

Commenting on the decision, Saudi Finance Minister Mohammed Al-Jadaan told Bloomberg that the move reflects continued confidence in the Kingdom’s economic transformation trajectory. He said the inclusion marks a new milestone in Saudi Arabia’s integration into global financial markets, adding that its immediate impact will be seen in broadening and diversifying the investor base and supporting long-term capital inflows into the domestic debt market, thereby strengthening the resilience and stability of the national economy.

The Significance of the Index

The importance of J.P. Morgan’s index lies in its role as a benchmark guiding major global fund allocations, particularly passive funds that track indices automatically. With an expected weighting of around 2.52 percent, Saudi bonds will become a core component of international investor portfolios, increasing government bond liquidity and reducing borrowing costs over the long term, a critical factor for the Kingdom’s economy.

Passive funds play a key role in ensuring steady inflows. Trillions of dollars globally are managed through such funds. Once Saudi Arabia is included in the index, these funds will purchase Saudi bonds to remain aligned with it. Unlike active investors, they do not rapidly buy or sell based on daily news or market sentiment, but continue to hold bonds as long as they remain in the index, providing significant stability to the Saudi debt market. Their participation also ensures a constant base of large-scale buyers, facilitating bond trading at any time.

Reforms That Paved the Way

This inclusion is the result of a series of regulatory reforms highlighted by the bank in its note. Saudi Arabia has improved international investor access by linking to the global Euroclear system, expanding its network of primary dealers to include international banks, and facilitating cross-border settlement and trading. These measures have enhanced legal certainty and transparency, making the Saudi debt market an attractive and secure destination for foreign capital.

Financial Stability Amid Regional Challenges

Beyond its economic dimensions, the move carries strategic significance amid ongoing geopolitical tensions in the region. Increased inflows into local bonds are expected to strengthen the government’s ability to manage any economic fallout from regional instability. It underscores the resilience and attractiveness of the Saudi economy, demonstrating its capacity to attract quality investment and secure the financing needed for its development plans regardless of external challenges.


S&P Warns African Sovereign Credit Rating Risks Likely to Worsen

Central Bank of Egypt building (A.P.)
Central Bank of Egypt building (A.P.)
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S&P Warns African Sovereign Credit Rating Risks Likely to Worsen

Central Bank of Egypt building (A.P.)
Central Bank of Egypt building (A.P.)

S&P Global Ratings warned on Thursday that the risks to African sovereign credit scores were likely to worsen the longer the Middle East war drags on.

The ratings agency said that higher fuel and fertilizer import costs would increase inflation and fiscal strains for countries, "potentially leading to rating pressure".

Egypt, Mozambique and Rwanda are among the "most exposed" the agency said, although Egypt's deep domestic capital markets and Rwanda's high levels of concessional debt provide some offset, according to Reuters.

Less exposed are net-oil exporters Nigeria, Angola and Congo-Brazzaville as well as Morocco, due to stronger foreign-currency reserves.

S&P's "base case" assumed that the conflict will peak and that the Strait of Hormuz will gradually reopen but related disruptions will likely persist for months. A resumption of hostilities and a more prolonged conflict would present a greater threat to many African sovereigns.

The ratings agency said it expected Africa's borrowing costs to increase due to war's impacts and as a result of global risk aversion.

S&P in recent weeks kept Egypt's credit rating on a "stable" outlook and affirmed ratings for Morocco, Ghana and Mozambique.