The latest data issued by Fitch Ratings revealed a radical shift in the financing strategies of the Saudi banking sector, as Saudi banks recorded record borrowing levels of about $33 billion during 2025. This figure represents a huge qualitative leap that is more than three times the highest level previously recorded in 2024, which amounted to $10.5 billion, reflecting the huge economic activity that the Kingdom is witnessing.
Growth drivers and credit acceleration
The agency explained that this significant increase in external borrowing coincides with highly positive economic growth prospects in Saudi Arabia, driven by strong and accelerating activity in both the oil and non-oil sectors. Since 2020, bank credit in the Kingdom has followed a sharp upward trajectory, with national banks becoming key players in financing mega-projects under the umbrella of "Vision 2030," whose total investments are estimated at $1 trillion.
This is not limited to major projects, but extends to the significant expansion in providing real estate financing to individuals and companies, coinciding with the boom in the housing and real estate sector, which has increased the need for banks to diversify sources of liquidity to meet the growing demand.
Economic context and strategic transformation
This move towards international debt markets is part of a broader strategy to bolster domestic liquidity. With the rapid awarding of contracts for mega-projects such as NEOM, Qiddiya, and the Red Sea Project, Saudi banks faced pressure on domestic liquidity, prompting them to turn to international markets to issue bonds and sukuk. The banks' success in raising $33 billion is a strong indicator of international investors' confidence in the strength of the Saudi economy and the financial soundness of Saudi banks.
Future projections and confirmation from S&P
In a related context, this report reinforces previous forecasts by S&P Global, which indicated that Saudi banks will continue to achieve strong growth rates in their loan portfolios. The agency affirmed that the financing needs associated with Vision 2030 projects will remain the primary driver of this growth for years to come. It also noted that reliance on external financing sources will not be a temporary phenomenon, but will continue as a strategic option to support the expansion of loan portfolios and maintain stable profit margins, thus solidifying the Saudi banking sector's position as one of the most dynamic in the region.
