Fitch Ratings, in its latest report, stated that banks in the Gulf Cooperation Council (GCC) have issued over USD 60 billion in debt in 2025. The agency also noted that this trend is expected to continue until 2026. The issuances are projected to reach USD 40 billion, excluding certificates of deposit (CDs), in 2025, the ratings agency further remarked. The rise in debt is driven by strong credit growth, increased maturities, and favourable financing conditions.
“We expect continued strong issuance in 2026, supported by further US Fed rate cuts, USD 36 billion of debt maturities, additional strong credit growth in Saudi Arabia and the UAE, and persistent tight domestic liquidity conditions in Saudi Arabia,” Fitch stated.
Issuance in 2025 has already reached the USD 55 billion mark, surpassing the 2024 total of USD 36 billion and the 2025 maturities of USD 23 billion. Excluding CDs, issuances have reached USD 36 billion, exceeding Fitch’s initial estimates for the year. Saudi lenders lead issuance with USD 28.3 billion, followed by banks in the UAE (USD 11 billion), Qatar (USD 8 billion), and Kuwait (USD 7 billion). Sukuk accounts for nearly half of the new deals, excluding CDs.
Gulf banks have accounted for almost 30% of US dollar issuance by emerging-market (EM) banks in 2025, and more than 60% when excluding Chinese banks. Subordinated debt sales by the region’s financial institutions have already reached USD 14.5 billion this year, compared to USD 7 billion in 2024, accounting for 40% of issuance, excluding CDs. This is further fuelled by Saudi banks (USD 11.2 billion) issuing to support financing growth linked to “Vision 2030” projects and in anticipation of tighter capital regulations.
Saudi banks have accessed the US dollar Tier 2 debt market for the first time since 2020. They account for most of the USD 6 billion of such debt already issued in 2025, compared to USD 1.5 billion in 2024. The move aims to diversify these financial institutions’ non-common equity Tier 1 capital away from additional Tier 1 (AT1) instruments, which remain dominant, given the modest spread differential between AT1 and Tier 2 debt in the Gulf region.
UAE and Qatari banks have focused on senior unsecured debt issuance to meet refinancing needs and diversify their funding bases, particularly through ESG bonds and sukuk. They have also been active in the Taiwanese Formosa market through floating-rate notes, with Emirati banks raising about USD 3.5 billion, followed by Qatari banks (nearly USD 1 billion).