Morocco stands out for its robust banking sector, among the most advanced in Africa, according to the EIB. With high private credit and a low rate of non-performing loans, Moroccan banks benefit from enhanced profitability and a growing regional presence, consolidating their position in the African financial sector.
The European Investment Bank (EIB), in its report entitled “Finance in Africa – Unlocking investment in the era of digital transformation and climate transition”, highlights that Morocco has a banking system among the deepest and most advanced of the African continent.
This report reveals that Moroccan banks have a private sector credit/GDP ratio of 88%, the highest in North Africa. This ratio far exceeds that of their Tunisian, Egyptian and Algerian counterparts, which stand at 62%, 31% and 21% respectively.
The document also indicates that in Morocco, consumer prices and credit to the private sector are growing at the same pace (6% in 2023), unlike other North African countries where high inflation has slowed growth. actual credit. In Algeria and Tunisia, for example, inflation, which stands at 9%, exceeds credit growth (5% in Algeria and 4% in Tunisia), thus causing a real decline in credit. In addition, the Moroccan banking system maintains a moderate level of non-performing loans, with a ratio of 8.6% in 2023. However, the EIB highlights that some private companies have had difficulty repaying subsidized loans granted during the health crisis. of COVID-19.
Furthermore, the EIB reports that “Algeria has by far the highest ratio of non-performing loans”, reaching around 20%, with provisions for loan losses rising to 50% at the end of 2022, according to the latest data available. In Tunisia, the proportion of non-performing loans stands at 12.6% in 2022, while in Egypt this ratio is the lowest in North Africa, at 3.3% at the end of the third quarter of 2023, according to the Central Bank of Egypt.
In Egypt, the proportion of non-performing loans has steadily decreased in recent years, including during the pandemic, thanks to public support measures, optimized risk management and an arbitration mechanism put in place by the bank central, explains the EIB. The report also highlights that the increase in interest rates has strengthened the profitability of Moroccan banks, which also benefit from inexpensive resources from current and savings accounts. As a result, their return on equity increased from 10.9% in 2022 to 11.8% in the first half of 2023.
Furthermore, according to the EIB, major Moroccan banks have expanded their activities in North Africa and sub-Saharan Africa, and are present in around 45 countries. The cross-border liabilities of the three largest banks represent around 27% of their assets.
