GCC asset managers added momentum in 2025, with total assets under management (AuM) reaching $2.7 trillion, according to a report by Boston Consulting Group (BCG). The figure represents a 10% increase from 2024 and adds to a decade-long conversation about how regional firms compete as fees come under pressure and technology reshapes investment operations.
The report, published as part of BCG’s Global Asset Management Report 2026: An Imperative for Growth, also highlights an uneven growth pattern. Retail-focused offerings expanded faster than institutional assets, while distribution capability, technology transformation, and the adoption of artificial intelligence are increasingly framed as determining factors for future outperformance.
AuM growth in the GCC: retail accelerates as competition tightens
BCG reports that GCC AuM grew by 10% in 2025 to $2.7 trillion. The report notes that this period reflects one of the strongest annual performances in more than a decade.
Within the region, retail assets increased at a faster rate. BCG estimates retail AuM grew by 14%, compared with 9% for institutional assets. While institutional assets remain the larger share of the market, the faster retail expansion suggests that product and channel strategies targeting individual investors may be gaining traction.
BCG further breaks down the market composition by segment. It states that retail accounts for 7% of GCC AuM, while institutional assets account for 93%. In other words, retail is growing quicker in relative terms, but it is still starting from a smaller base.
Saudi Arabia leads retail share, with pensions and sovereign funds shaping flows
BCG points to Saudi Arabia as a key anchor for retail growth in the broader Middle East and the GCC. The report says Saudi Arabia holds the highest share of retail mutual funds and exchange-traded funds (ETFs) across the region, followed by the UAE and Kuwait.
Pension structures and sovereign wealth funding remain important in the GCC landscape. BCG identifies the General Organization for Social Insurance Public Pension Agency (GOSI-PPA) in Saudi Arabia as the largest pension fund in the region. In Kuwait, WAFRA is described as the second-largest pension fund.
On the sovereign wealth side, BCG reports that Kuwait Investment Authority has the largest externally managed AuM, followed by Abu Dhabi Investment Authority. These institutions, while not necessarily direct drivers of retail-led growth, influence institutional investment demand and can affect how asset managers compete for large mandates.
Distribution becomes the center of gravity for growth
A central theme in BCG’s analysis is a structural shift in how asset managers win. With product manufacturing becoming more standardized, distribution channels are increasingly treated as a differentiator. The report describes distribution as the “primary battleground” for growth, encompassing platforms, advisors, and institutional relationships.
For firms in the GCC, this framing matters because channel access often determines whether investment strategies reach investors efficiently. It can also influence marketing costs, onboarding speed, and the ability to scale new products without proportionally expanding headcount.
AI and technology transformation: from pilots to operating model redesign
BCG argues that AI is compressing traditional differentiation and enabling new forms of scale, particularly by changing how investment and client coverage work is delivered. The report suggests that AI could help reduce costs and expand research and client coverage, while allowing faster, more scalable personalization.
BCG estimates that asset managers could reduce costs by 25% to 35% over the next three to five years. It also projects increases in research coverage by a factor of two to five, alongside higher client coverage per relationship manager, potentially three to five times, depending on implementation.
At the same time, BCG cautions that many firms are still in early adoption stages, focusing on pilots rather than full transformation. The implication is that benefits may be limited if operating models are not redesigned to integrate AI across workflows, data management, compliance processes, and client servicing.
Tokenization and digital assets as an emerging competitive disruptor
Beyond AI, BCG highlights tokenization as another factor that could reshape how capital products are accessed and distributed. The report points to projections for the value of tokenized real-world assets, estimating that it could reach $14 trillion by 2030 and $55 trillion by 2035.
For the GCC asset management sector, tokenization is relevant less as a near-term certainty and more as a potential channel shift. If tokenized assets expand, it could introduce new distribution routes and potentially change how ownership, transfers, and product design function.
BCG suggests that these developments may weaken traditional advantages tied to scale and established distribution networks while creating room for new entrants or more agile incumbents.
What the BCG report suggests for GCC investors and managers
With AuM growth continuing and retail segments expanding faster, the GCC market appears to be evolving in both demand and delivery. BCG’s broader industry framing indicates that future performance may depend less on simply launching products and more on securing distribution access, building technology-enabled platforms, and integrating AI in a way that changes economics.
For investors, the shift could translate into more frequent personalization and potentially more coverage from investment teams, though actual outcomes will depend on how quickly firms move from experimentation to deployment. For asset managers, the competitive challenge is likely to be operational as much as commercial, requiring sustained investment in data, digital channels, and governance.
BCG positions the GCC industry as being at an inflection point, where firms that redesign their operating models and strengthen distribution capabilities may be better placed to capture growth amid fee pressure and a faster-moving technology agenda.
BCG’s report is available via its publication page.
