Capital market institutions post record revenues and net profit, CMA official reveals

Companies authorized by Saudi Arabia’s Capital Market Authority posted record profits in 2022, with a cumulative total of SR60.34 billion ($16.08 billion) – a 39.17 percent increase on the previous year.

Figures released by the CMA’s Deputy of Market Institutions, Bander Sulaiman Al-Ayed, showed that this figure came off the back of a 29.8 percent year-on-year rise in income.

According to a press release, the profits of capital market institutions boomed due to a 26 percent-rise in revenue in 2022, reaching more than SR12 billion – the highest in the CMA’s history.

Al-Ayed said the figures were a clear indication of the effective role the capital market institutions play in the Saudi financial sector, on which the Kingdom places great importance within the framework of the Vision 2030 initiative to diversify the economy away from oil.

He went on to say that the number of portfolios managed by capital market institutions hit a record high of 37,021 portfolios by the end of 2022 – an increase of about 1,204 percent compared to the end of 2021.

Asset management revenues represented the biggest ratio of the capital market institutions’ aggregate revenues at 33.64 percent, followed by dealing activity at 19.67 percent, investment at 16.45 percent, and investment banking at 9.71 percent.

The remaining ratios were divided among other revenues, advice, and custody.

In addition, Al-Ayed reported that the local shares category acquired the biggest stake of asset values managed by the authorized capital market institutions in the discretionary portfolio management tranche at 45.61 percent with SR20.97 billion by the end of 2022.

This was followed by the investment funds category at 23.48 percent.

The stake in international shares, debt instruments, and other investment categories reached 30.91 percent.

In May, the CMA released a report showing that Saudi Arabia’s financial market led its counterparts in other G20 countries in 2022 in terms of shareholders’ rights and stock market capitalization as a percentage of gross domestic product.

In its annual report, the authority stated that the rate of public offerings in the Saudi capital market advanced to a new high, with a portion of 37 businesses’ shares offered for sale in the main and parallel markets for a total of SR40 billion.