Transform Challenges into Opportunities with Financial and Risk Advisory in Saudi Arabia

In the fast‑evolving economic landscape of Saudi Arabia, companies face growing complexity in managing financial uncertainties, regulatory changes, and volatile macroeconomic conditions. Engaging a skilled financial risk management consultant from the outset can enable firms to navigate these headwinds, turn potential pitfalls into strategic advantages, and safeguard long‑term growth. As the demand for professional risk oversight rises, prudent advisory becomes not just desirable but essential for sustainable success in the Kingdom.

The Changing Economic Context in KSA

Saudi Arabia’s economy is undergoing a significant transformation under Vision 2030, with mounting emphasis on non‑oil growth, infrastructure, and private‑sector development. According to the latest assessments by the International Monetary Fund (IMF), non‑oil real GDP growth is projected at 3.4 percent in 2025. Meanwhile overall GDP growth for 2025 is expected around 3.5 to 4 percent.

This transition is generating new opportunities across sectors including construction, real estate, manufacturing, and services. At the same time, it is raising the stakes on financial discipline, credit risk, and regulatory compliance  creating a fertile ground for professional financial and risk advisory services.

Why Risks Are Growing, and Why Advisory Matters

As capital flows into new sectors and private investments accelerate, companies face multiple layers of risks

• Credit and liquidity risk: According to the 2025 edition of the regional banking pulse by Alvarez & Marsal (A&M), loans and advances in Saudi banks grew by 14.4 percent year‑on‑year in 2024, driven primarily by corporate lending, while deposit growth slowed to only 7.9 percent. That mismatch pushed the loan‑to‑deposit ratio (LDR) upward to roughly 104.7 percent by end‑2024.
• Funding pressure and cost of funds: Rising funding costs and greater reliance on non‑deposit funding are challenging traditional banking models. A&M indicates that cost of funds rose 55 basis points in 2024, squeezing net interest margins.
• Asset quality and non‑performing loans (NPLs): Although the overall NPL ratio remains low reported at about 1.3 percent of systemwide loans as of September 2024. Analysts caution that elevated corporate exposures and aggressive lending may erode asset quality over time, with some forecasts expecting NPLs to climb to 1.7 percent by end‑2025.
• Macroeconomic and external risk: Fluctuating oil prices, global trade tensions, and currency or interest rate shifts can affect firms’ cash flows, cost of capital, and export‑import dynamics. The IMF warns that despite robust non‑oil growth, such external vulnerabilities remain.

Given these complexities, having a financial safety net is no longer optional. A robust advisory framework helps firms anticipate, measure, and mitigate risks not reactively, but proactively.

What a Financial and Risk Advisory Approach Looks Like

A comprehensive advisory engagement for companies in KSA typically involves several interlocking services

• Risk assessment and scenario analysis: Mapping out potential economic, credit, and operational risks; stress‑testing business models under different market conditions.
• Capital structure and funding optimization: Advising on mix between deposit funding, bond financing, external borrowing, and equity to ensure liquidity and minimize cost of capital.
• Regulatory compliance and credit risk governance: Helping firms adhere to banking and financial regulations, while building robust internal controls and risk‑management frameworks.
• Strategic planning and growth advisory: Aligning business expansion plans with macroeconomic trends, ensuring sustainable growth rather than over‑leveraged expansion.
• Ongoing monitoring and reporting: Establishing dashboards and key‑risk indicators to detect emerging threats early and respond swiftly.

Engaging a seasoned financial risk management consultant ensures that companies benefit from specialized expertise in modeling, stress‑testing, and strategic planning tailored to the Saudi context.

Opportunities for Businesses, If Risks Are Managed

When advisory is used effectively, what might appear as challenges become growth levers. Key opportunities include

• Capitalizing on credit‑linked growth: As per recent data, Saudi banks are expected to provide $65 to $75 billion in new corporate loans annually during 2025–2026. Companies prepared with strong risk frameworks can tap into this wave with confidence.
• Expanding non‑oil ventures: With non‑oil GDP growth projected at 3.4 percent in 2025, companies investing in sectors like construction, tourism, manufacturing, or services can benefit from rising domestic demand.
  Leveraging favorable liquidity and capital conditions: The banking sector remains well capitalized with healthy liquidity. As of Q2 2025, the capital adequacy ratio across major banks was around 19.5 percent. This environment supports credit availability for expansion.
• Mitigating downside risks through structure and discipline: With proper advisory controls, firms can avoid the pitfalls of over‑leveraging, bad debt accumulation, or liquidity crunch  protecting shareholder value and reputation.

Key Elements of Effective Advisory Engagement

To derive maximum benefit from financial and risk advisory, companies in KSA should ensure that their advisory partner follows best‑practice standards

• Use data‑driven risk modeling: Analytical rigor helps predict outcomes under different economic scenarios and build contingency plans.
• Integrate risk management into strategic planning: Risk advisory should not be an afterthought but embedded in business strategy from day one.
• Maintain transparency and governance: Clear reporting and accountability ensure early detection of risks and swift corrective action.
• Monitor macroeconomic and sectoral trends: Advisors should keep ahead of policy changes, interest rate shifts, funding conditions, and regulatory reforms.
• Align advisory with local context and regulatory environment: Saudi‑specific knowledge around banking behavior, funding norms, and regulatory expectations is critical.

Engaging a seasoned financial risk management consultant who understands both global best practices and Saudi realities can make the difference between fragile growth and sustainable success.

How a Financial Consultancy Firm Adds Strategic Value

When companies partner with a reputable Financial consultancy Firm, they gain access to specialized expertise, structured frameworks, and a disciplined advisory process. A good Financial consultancy Firm will bring together seasoned professionals from risk analysts and credit specialists to capital‑markets advisors  to develop a holistic risk‑management strategy tailored for the Kingdom’s evolving economic environment.

Working with the right firm helps mitigate credit, liquidity, market, and operational risks while enabling companies to seize investment and growth opportunities with confidence and clarity.

Conclusion

Saudi Arabia’s evolving economy is creating abundant opportunities for businesses across sectors. At the same time, rising financial and credit complexity means that risks can escalate quickly without proper oversight. By engaging a competent financial risk management consultant early, firms can transform uncertainty into strategic advantage, turning economic and regulatory challenges into sustainable growth engines. Aligning with a trusted Financial consultancy Firm ensures that firms do not just survive they thrive in the new era of Saudi economic transformation.

As the Kingdom moves ahead under Vision 2030, now is the time to embrace proactive risk management and advisory leveraging expertise to build resilience, confidence, and long‑term success.