Casablanca – Bank Al-Maghrib announced that the banking sector maintained strong fundamentals throughout 2023. This assessment came during the meeting of the Coordination and Systemic Risk Monitoring Committee, held last Tuesday at the bank’s headquarters in Rabat.

The committee highlighted a significant recovery in banks’ profitability, with aggregate results rising by 20.4% by the end of 2023, following a 13% decline in 2022. This improvement is largely due to better market operations outcomes.

Capitalization levels remained robust, with individual banks showing solvency ratios and Tier 1 capital ratios of 15.5% and 12.9%, respectively, surpassing the regulatory minimums of 12% and 9%. On a consolidated basis, these ratios were 13.5% and 11.6%, respectively.

The overall solvency stress test confirmed that the banking sector is capable of withstanding scenarios of economic downturn. Additionally, the short-term liquidity ratio remains well above the regulatory threshold of 100%, indicating a comfortable liquidity position.

Financial market infrastructures continue to demonstrate substantial resilience both financially and operationally, posing minimal risk to financial stability.

The committee reviewed and approved the 2023 Financial Stability Report and noted significant progress on the 2022-2024 financial stability roadmap.

Systemic risk assessments and findings from the committee’s monthly subcommittee indicated that the financial sector remains robust and resilient.

The committee also praised efforts to align national anti-money laundering and counter-terrorism financing mechanisms with the Financial Action Task Force (FATF) recommendations. This alignment was endorsed by the FATF’s Middle East and North Africa region during their meeting in Manama in May 2024.