Morocco’s banks have begun their annual reporting season for 2006, and so far the news from the sector has been robust.
“Three banks now control 64% of the market, against 53% three years ago,” Abdellatif Jouahri, the governor of Bank al-Maghrib, the central bank, told OBG. “Thus, we are witnessing the emergence of large financial structures with an increased financial mobilization capacity and the means to support large projects on a national scale.”
Attijariwafa Bank kicked off the reporting season, publishing consolidated net banking results that rose by 19.9% year-on-year, to reach Dh6.76 billion. Although competition between the larger banks has increased, resulting in the limitation of commercial interest rate differentials, Attijariwafa managed to register a 6.3% rise in its interest margins, reaching Dh4.28 billion.
Meanwhile, margins on commissions progressed by 46.9%, while renting and lease-credit operations rose by 45.8%. The largest increase was undoubtedly in market operations, which grew by 87.1%. The largest bank in terms of deposits, Attijariwafa holds a market share in deposits of 27.53%, or Dh117.1 billion.
The second-largest bank in the kingdom, Groupe Banques Populaires (GBP), also announced healthy growth rates on March 29, with its consolidated net banking result up 5.6% to Dh6.1 billion and a 35.7% increase—the highest rise in the market—in its net profit, standing at Dh2.3 billion. Client deposits rose by 13.9% and margins on commissions by 19.3%.
Socially responsible can also be profitable
GBP holds the largest share of consumer loans, with 41.9% of the market.
“We have proved that a socially responsible and cooperative bank can also be a very profitable bank, meeting the needs of all types of clients,” said Noureddine Omary, the president of GBP.
Banque Marocaine du Commerce Exterieur (BMCE) recorded a 16.3% increase in its consolidated net banking result, reaching Dh3.61 billion. Its client credits progressed by 23.5% to reach Dh46 billion, with real estate credits rising 50%.
Real estate loans accounted for the main increase for a majority of banks, reflecting the strength and sustained growth in the real estate sector at large.
Crédit Immobilier et Hotelier (CIH), recorded a profit for the first time in 12 years in the first quarter of 2006, turning a Dh48 million deficit in 2005 into a Dh388 million profit for 2006. All indicators rose for CIH, bearing the fruits of restructuring efforts under its CEO Khalid Alioua. Its consolidated net banking result rose from Dh914 million to Dh1.15 billion.
Banks affiliated with international groups have not been able to conduct as many market operations as local banks, given that policies for operations involving local treasury bonds are fixed from their international headquarters. Nevertheless, their 2006 results proved just as robust.
Crédit du Maroc (CDM) registered an increase from Dh65 million to Dh84 million in 2006 in terms of results of market operations. Interest margins rose from Dh930 million to over Dh1 billion, while margins on commissions stayed relatively stable at Dh214 million.
Healthy rise for CDM
Consolidated net banking profits for CDM nonetheless registered a healthy rise to Dh1.3 billion in 2006, from Dh1.2 billion in 2005 and net profit stood at Dh317 million, a rise of some 25%.
Société Générale Marocaine de Banques (SGMB) recorded a rise in consolidated net banking result from Dh1.8 billion to Dh2.2 billion, while client deposits rose from Dh27 billion to Dh32 billion. In all, consolidated net profit rose by a strong 15.1% to reach Dh536 million.
“In terms of net banking profit and despite a significant tightening of intermediation margins, the SGMB group developed by 9.71% to reach Dh2.2 billion,” Jerome Guiraud, the CEO of SGMB, told OBG.
Meanwhile, the Banque Marocaine pour le Commerce et l’Industrie (BMCI) boosted its consolidated net banking result from Dh1.7 billion to Dh1.8 billion, while net profit rose from Dh492 million to Dh535 million in 2006. Interest margins rose from Dh1.4 billion to Dh 1.5 billion and margins on commissions rose from Dh188 million to Dh234 million. However, the results of market operations declined from Dh116 million to Dh104 million over the year.
Such strong performances by the banks reveal their resilience in the face of increasing competition. With full implementation of the Basel II regulations looming in June, and leading banks finalizing a reassessment of their risk management practices, such buoyant results should comfort both shareholders and bank directors alike.
