Banks listed in Morocco would record record performances during the period 2024-2026. This is what a recent report from Attijari Global Research (AGR) reveals.
“The banking sector in Morocco is expected to post record performances during the period 2024E-2026E. Thus, we have revised our profit growth forecasts upwards, from an initial average annual growth of 8.3% to 13.5% to exceed 22.0 billion dirhams (billion dirhams) at the end of the period. studied”, indicated AGR in its January “Research Report Equity”, devoted to the balance sheet and prospects of the banking sector.
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According to the same source, banks listed in Morocco confirm, in a generally resilient macroeconomic context, the improvement in their growth profile. Concretely, the average annual growth rate (CAGR) of their net banking income (NBI) increased from 3.7% during the pre-COVID period to 7.5% over the forecast period 2023-2026.
Also, this scenario is supported by several factors, in particular the new investment dynamic in Morocco, which translates positively into an increase in equipment loans of 14.2% at the end of October 2024, according to AGR. In addition, the solid recovery in construction starts, up 32.1% in the first half of 2024 thanks to the Direct Housing Assistance Program, is a harbinger of the great return of housing credit from 2025.
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-Still according to the division specializing in analysis and research within the Attijariwafa Bank group, market activities are experiencing a positive trend in Morocco, supported by the start of a new accommodating monetary cycle and by the accelerated democratization of hedging products among SMEs . Not to mention that the continued optimization of the average cost of resources is favored by a sustained increase in non-remunerated deposits.
AGR also cites the underlying downward trend in the operating coefficient (COEX) which attests to the proven ability of Top Management to optimize costs, noting that thanks to the growing adoption of digital platforms by clients, the COEX of sector could improve by an additional 5.7 points during the period 2023-2026, going from 47.3% to 41.7%.
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And to add: “on the sidelines of our valuation exercise, we emerge with a target market capitalization of the listed banking sector of MAD 312 billion, offering an appreciation potential of 13.0% over the next 12 months and a P/E 26E induced which remains conservative around 14.0x”.
