The banking sector in the Middle East is undergoing rapid transformation, driven by digital acceleration, rising supervisory expectations and a growing dependence on complex decision models. These models have quietly become the core engines of decision-making — influencing everything from credit underwriting and capital planning to fraud detection, customer engagement. The influence is now expanding further, adding new dimensions to model risk with the rapid rise in use of machine learning (ML) and AI techniques, especially in data-rich and customer-facing use cases.
As this reliance and use deepens, so does the need for robust model risk management (MRM). No longer just a regulatory requirement, MRM is emerging as a strategic priority for banks seeking to manage complexity, mitigate risk and remain resilient in a fast-changing environment as well as maintain competitive advantage.
We engaged with 23 leading banks across the United Arab Emirates (UAE), Saudi Arabia, Oman and Qatar to conduct a first-of-its-kind survey for better understanding how the MRM landscape is evolving — and the challenges institutions continue to face. This article is more than just a summary of findings, it is a mirror and a map reflecting the shared intent behind that effort — to benchmark MRM practices, spark dialogue, and contribute to the region’s journey towards more resilient model governance. The report is designed to help banks and risk leaders reflect on their current maturity, recognize shifting regulatory expectations, and take meaningful steps to shape the future of MRM in the region.
