Al-Sudairi in His First Interview Since Leading the Market Authority: Reforms Within 90 Days, Individual Share in IPOs Should Rise to 30%

Mazen Al-Sudairi, Chairman of the Capital Market Authority, unveiled an executive plan to launch market reforms within 90 days, emphasizing that the goal is for the stock market to become a 'true reflection of the Saudi economy' and a place for citizens to save.

In an interview with Al Arabiya Business, Al-Sudairi stated, 'When I was appointed as chairman of the authority, the directive from the Custodian of the Two Holy Mosques and the Crown Prince was clear: to create fairness in the market and enhance its efficiency.'

He explained that the authority has identified challenges that necessitate reform, notably the increase in declining stocks, the quality of some initial public offerings, and the decline in individual investor participation.

IPOs: Coverage Is Not a Success Criterion

Al-Sudairi asserted that the high number of times an IPO is covered is not enough to judge its success, and the most important criterion is the stock's performance after listing. He added that many subscription requests do not reflect genuine investment demand.

He revealed that the authority is redefining responsibilities among offering parties, including advisors, underwriters, and issuing companies, and has investigated several previous offerings.

Regarding individual allocations, he stated that the 10% share is not fixed and that their share should ideally rise to 30%, with the percentage potentially varying in large IPOs.

Short Selling and Algorithms

Al-Sudairi mentioned that short selling is beneficial to the market provided it is not used negatively, noting indicators of potential negative impacts from some of its current practices. He explained that the authority has started with the first part, which is stock lending, and is working on new regulations.

He noted that a significant portion of algorithmic trading in the Saudi market is conducted by foreign financial institutions, and the authority monitors them to ensure compliance with regulations and fairness among investors.

Foreign Ownership and Governance

He disclosed that the authority is discussing foreign investor ownership percentages with government entities and sector regulators.

In terms of governance, he explained that the authority is working to empower general assemblies and enhance their efficiency, mandating listed companies to hold two annual meetings with investors to discuss financial results. He confirmed that setting standards for board member compensation is not within the authority's role.

'No Guardianship Over Investors'

Regarding the flow of local liquidity to global markets, Al-Sudairi stated that the authority does not adopt a guardianship concept over investors, and the conditions imposed on foreign trading are the same as those applied locally.

He added that maintaining liquidity is not about imposing restrictions but about enhancing market competitiveness and confidence.

He emphasized that the authority will work on 'everything necessary to boost confidence,' aiming to be 'a source of trust, not fear,' and its role is 'not that of a policeman, but a regulator balancing all parties.'

Al-Sudairi was appointed as chairman of the authority with the rank of minister by royal decree on August 13, 2026, after years in equity research, during which he headed the research department at Al Rajhi Capital.