UAE banks are increasingly looking beyond their borders as they face domestic challenges and shifting interest rates, prompting them to pursue international growth opportunities. Leading Emirati banks are strategically expanding abroad to address local difficulties, such as early government repayments and pressure on net interest margins. For instance, Abu Dhabi Islamic Bank increased its exposure to Saudi Arabia by 28% in the first quarter of 2025, with loans to Saudi clients now representing 11% of its overall portfolio. Additionally, Abu Dhabi Commercial Bank raised its international lending by 6%, excluding Egypt, bringing it to 21% of its total lending.

This international focus is part of a broader strategy aimed at diversifying revenue streams, as banks report double-digit growth in non-funded income. The emphasis on opportunities in Saudi Arabia is driven by the region’s potential, even as local credit demand softens and global interest rates decline. UAE banks are projecting high single-digit to low double-digit loan growth in 2025, indicating that their focus on international markets could lead to new avenues for growth in banking.

The expansion of UAE banks into international markets underscores a significant economic trend where global growth becomes essential for overcoming domestic pressures. As interest rates fluctuate worldwide, entering new markets may establish a precedent for how regional banks respond to global changes, potentially reshaping the landscape of banking in the Middle East.