With the increase in the number of mega projects in Saudi Arabia and the economic reforms that have achieved tangible results, experts expected a growth in mergers and acquisitions.
The banking sector would see mergers by the end of 2021, according to the experts, given the volume of financial operations.
Two mergers of local banks are expected to take place in the coming months; while other sectors, such as insurance, real estate and e-commerce are also heading towards the same direction.
Economic Advisor Suleiman al-Assaf stated that mergers and acquisitions; between companies and banks was a prelude to an important stage of work and performance development.
Saudi Arabia is witnessing a modern economic boom under Vision 2030, he emphasized; noting that economic changes would push the Kingdom to the forefront of the international economic scene.
Al-Assaf expected two mergers to take place between Saudi banks, one of which is certain and the other projected soon.
He noted that Saudi banks must keep pace with these developments; which have recently registered one of the largest banking mergers.
“The Saudi economy constitutes 50 percent of the Gulf economy; but Saudi banks account for less than 10 percent of the size of GCC banks in terms of numbers,” he also said.
The insurance sector is also likely to witness many mergers, according to Al-Assaf; who pointed to several factors, mainly the large number of companies and the little amount of work. In addition to the financial losses incurred as a result of the pandemic.