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The Gulf Cooperation Council’s (GCC) asset management industry grew to $2.2tn in assets under management (AuM) in 2024, representing a 9 per cent increase from the previous year, according to Boston Consulting Group’s (BCG) 23rd Global Asset Management report, titled From Recovery to Reinvention.
The report highlights Saudi Arabia and the UAE as the principal contributors to retail mutual fund growth, while Abu Dhabi and Kuwait’s sovereign wealth funds (SWFs) manage the largest volumes of assets in the region.
Lukasz Rey, MD and partner and Middle East head of Financial Institutions at BCG, said: “The next decade’s leaders will be those who redefine their future, not just endure challenges. The region’s 9 per cent AuM growth in 2024 underscores its rising prominence as a hub for institutional and retail capital. With Saudi Arabia and the UAE anchoring regional momentum, the GCC’s strategic diversification and SWF dominance signal a future where local asset managers could rival global giants. Recent market volatility offers a chance for change, prompting asset managers to move from recovery to innovation—reimagining value delivery, client engagement, and business operations.”
GCC AUM: revenue growth driven by market performance
Revenue growth in 2024 was primarily driven by market performance rather than investor inflows, underscoring the industry’s vulnerability to external forces. The report also noted that persistent fee compression, shifts in investor preferences, and digital disruption are pushing firms to redesign business models, accelerate cost innovation, and sharpen strategic focus.
Mohammad Khan, MD and partner at BCG, added: “The GCC’s asset management industry has demonstrated remarkable resilience and strategic growth, achieving $2.2tn in AuM in 2024. With Saudi Arabia and the UAE driving retail mutual fund expansion and Kuwait and Abu Dhabi leading in sovereign wealth fund dominance, the region is steadily establishing itself as a global financial powerhouse. This growth reflects not only recovery but a strategic pivot towards innovation and operational excellence. The next decade will be defined by asset managers who prioritize client-centric transformation, technological advancement, and leaner business models, positioning the GCC as a formidable force capable of rivaling global industry leaders.”
Three factors driving the industry
The BCG report identifies three forces reshaping the industry globally:
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Opportunities to create new products in response to changing investor demands – Asset managers can expand into actively managed ETFs, model portfolios, and separately managed accounts, as well as deliver private assets to retail clients. Retail access to private markets has expanded more than fivefold over four years, surpassing $300bn, driven by demand for better risk-adjusted returns, though regulatory hurdles and investor education remain key challenges.
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A critical need for consolidation and digital transformation – Strategic partnerships and mergers and acquisitions are enabling firms to gain scale, broaden offerings, and build technological capabilities. Large asset managers can lower costs through technology synergies and operational efficiency, while those managing less than $300bn must focus on leaner models.
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A renewed focus on cost – Operational efficiency, enhanced decision making, and client engagement are key priorities. Generative AI is emerging as a critical tool for process automation and product delivery, particularly in illiquid and alternative assets, and is being deployed across front, middle, and back offices.
Nabil Saadallah, MD and partner at BCG, said: “While currency adjustments and methodology revisions cloud historical comparisons, the consistency of 9 per cent annual growth across the GCC reveals a resilient market. Pension funds and SWFs, led by Saudi and Kuwaiti institutions, are quietly reshaping the region’s financial architecture, blending tradition with global asset management rigor. Notably, cost discipline is now a strategic focus, with firms prioritising unique value creation, embracing lean practices, and investing heavily in transformative technologies.”
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