Morocco World News

#Morocco's Islamic 'Participatory' Banks: 71 Agencies and MAD 1.1 Billion in Loans

Since the launch of Islamic 'participatory' banks in July 2017, more than 71 agencies have joined the non-interest banking program throughout Morocco. Abdellatif Jouahri, the governor of Bank Al Maghrib (Morocco’s central bank), said the participatory banks have granted a total of MAD 1.1 billion in loans. Jouahri highlighted the special interest that murabaha is especially attractive for both real estate and automobile customers. The governor stressed that Morocco is preparing to issue its first sukuk in July 2018, which will complement the services offered by participatory banks. While the order approving the takaful circular has already been finalized, the legislative texts are still being finalized.

#Morocco to Issue its First #Sukuk Islamic Bonds in 2018

Morocco will finally launch its first sukuk in 2018. According to Hicham Talby, head of the financial sector department at the Ministry of Finance, the new financial instruments that will be operational this year will include four different formulas: Ijara, Wakala, Musharaka, and Murabaha. First, the government must complete the operational, legal, and regulatory aspects of Islamic finance. As Morocco’s first sovereign debt is taking some time to be issued, Talby expects the process to be much faster for the next three planned sukuk issues. The government originally adopted legislation allowing Islamic banking and insurance in January 2014, but there was a delay in authorization.

Islamic Development Bank to Launch Multimillion Dollar Fund in Rabat

On the 4th of February, Rabat will be the host city for a workshop introducing a multimillion-dollar fund from the Islamic Development Bank called Transform to Morocco. The fund is intended to stimulate growth in science, technology and innovation and its first undertaking is an online platform called Engage. This venture will help match businesses with innovators and will fund scientific initiatives. The February workshop will be presented by Dr Hayat Sindi, who will meet with chief Ministers and Government Agencies during her tour in Morocco. She will meet spokespeople from the Ministry of High Education, Ministry of Economy and Finance and the Ministry of Industry, Investment, Trade and Digital Economy.

Islamic Banking: Bank Al Maghrib Interested in IFSB Prudential Standards

Bank Al-Maghrib and the Islamic Financial Services Board (IFSB) co-organized a regional workshop entitled "Facilitating Implementation of IFSB Standards" in Rabat. The workshop focused on 3 standards for participatory banking: IFSB-15 "Revised Capital Adequacy Standard" on Prudential Capital and Solvency Standards, IFSB-16 "Revised Guidance on Key Elements in the Supervisory Process" on Supervision Standards, and GN-6 "Quantitative Measures for Liquidity Risk Management" on prudential liquidity standards. This event is part of the measures taken by Bank Al-Maghrib to finalize the regulatory framework governing participatory banking activities in Morocco.

Qatar International Islamic Bank, CIH to Launch Islamic Bank in #Morocco

In partnership with the Moroccan Crédit Immobilier et Hotelier bank (CIH), Qatar International Islamic Bank (QIIB) will launch Umnia Bank, a joint Islamic financial institution. Licensing for the Umnia Bank had already been issued by the Central Bank of Morocco. According to QIIB chairman Sheikh Dr Khalid bin Thani bin Abdullah al-Thani, QIIB is now closer to formally launching the activities of Umnia Bank. He expressed his happiness to reach this stage and stated that Umnia Bank looks to be the best Islamic bank in Morocco. He added that QIIB is determined to contribute to the growth of the Moroccan economy.

#Morocco Receives $7.6 Billion from Islamic Development Bank

During the Arab-Africa Trade Bridges forum held in Rabat, bank president Bandar Al-Hajjar spoke about the strategic ties between Morocco and the Islamic Development Bank (IDB). Al-Hajjar noted that Morocco has received a total of USD 7.6 billion from the IDB since its establishment in 1974 and currently the bank is carrying out a number of projects estimated at USD 1.2 billion. Al-Hajjar also praised Morocco’s efforts towards renewable energy, saying that there is a bilateral cooperation between the IDB and Morocco to share Moroccan experiments in this field with Sub-Saharan countries. The IDB has supplied Morocco with several loans over the past few years. In 2014, the IDB amounted to MAD 1.8 billion to Morocco in order to carry out drinking water supply projects, as well as the olive sector for small farmers. The IDB has also embarked on signing agreement with partners to invest in Morocco. In 2014, it signed a joint agreement with Kuwait Investment Authority (KIA) to invest in the Moroccan private sector.

U.K.-Based Research Predicts Rise of Contactless Payments, Sharia-Compliant Credit Cards in #Morocco

New market research conducted by Timetric expects the rise of contactless payment services (CPS) and Sharia-compliant credit cards in Morocco over the next few years. According to the United Kingdom-based research, Centre Monetique Interbancaire, Morocco’s own internal network switch, launched CPS in the kingdom just over a year ago alongside MasterCard. So far the CPS point of service terminals have only been deployed in Casablanca, but they are expected to reach Rabat and Marrakesh in the coming months. By the end of 2016, Moroccans will be able to take advantage of 6,000 terminals, and by 2017 that number will more than double to 17,000. By the end of the year, the government plans to authorize a total of 10 banks which provide Sharia-compliant credit card services.

Morocco Well-placed to Offer Platform for Islamic Banks- Minister

Thanks to its economic diversity and proximity to Europe, Morocco is well-placed to offer a platform for Islamic banks, Lahcen Daoudi, Minister of Higher Education and Scientific Research said. Speaking at a conference organized by the national school of commerce and management (ENCG) in Tangier under the theme: “the foundations of Islamic banks” the Minister said that Islamic banks are considered as a source of wealth for Morocco that will contribute by 0.5% to 1% in PIB per year. As for human resources, the minister affirmed that the staff working in other banks will not find difficulties in joining Islamic banks.

Emirates Islamic Bank to Open Branches in Morocco

Emirates Islamic Bank (EIB) is willing to invest in the Moroccan Islamic banking sector in the two upcoming years. EIB’s CEO, Jamal Bin Ghalaita, said the bank is planning to explore the potentials of the Moroccan Islamic finance through a policy of acquisitions and obtaining operating licenses from regulating authorities. He added that the Moroccan Islamic banking market is among the markets with the greatest potentials for Islamic banking outside the GCC. Ghalaita also said the bank has the same planned investments in other countries with strong economic ties with the United Arab Emirates and GCC countries. He said the bank is also assessing opportunities for expansion in the coming period in Egypt and Turkey.

Morocco, Most Indebted Arab and African Country: McKinsey

According to a new report by McKinsey Global Institute, Morocco is the most indebted among Arab and African countries. The kingdom’s debt-to-GDP ratio stands at 136 % or an increase by 20 percentage points of GDP. The analysis focuses on the debt of the “real economy”: governments, nonfinancial corporations, and households. The report has revealed that debt-to- GDP ratios have increased in all 22 advanced economies reviewed by the study. Morocco comes ahead of both Egypt and Saudi Arabia which have actually succeeded in reducing their debts. The report has also found that global debt has grown by $57 trillion or 17 percentage points of GDP since 2007, to stand at $199 trillion, equivalent to 286% of GDP.

BMCE Bank to Create New Subsidiary Specializing in Islamic Finance

BMCE bank is reportedly planning to create a new subsidiary specializing in Islamic finance. The group owned by the Othman Benjelloun, Morocco’s richest man, will embark on a joint venture with Saudi Arabia’s Al Baraka Banking Group to create a new subsidiary specializing in Islamic finance. Al Baraka Banking Group will reportedly hold 51% of the new subsidiary while the Moroccan bank BMCE will hold the remaining 49%. Several BMCE executives have received training on Islamic finance in Jordan and Turkey. The step follows the adoption of the law authorizing the creation of participatory banking by the parliament.

Morocco approves Islamic finance legislation

After months of delays, the Moroccan parliament finally approved the Islamic financial bill that will regulate Islamic banks and sukuk issues in the kingdom. This new bill will pave the way to financial institute to establish full-fledged Islamic banks in Morocco. It will be effective once it is published in Morocco’s official bulletin in coming days. Last month, Brahim Benjelloun Touimi, the CEO of “Banque Marocaine du Commerce Exterieur” (BMCE), said that the bank was preparing to launch an alternative subsidiary as a joint venture with a major Islamic financial institution from the Middle East, without revealing the identity of that financial institution.

Morocco hopes regulation will aid second Islamic finance drive

Morocco is set to give Islamic finance a second try, counting on closer regulation and a clearer legislative framework to resolve problems which plagued its first attempt in 2007. Morocco’s parliament is considering a detailed bill that would regulate Islamic banks and issues of sukuk, and its passage – which could occur this year – is expected to prompt some Moroccan banks to establish dedicated sharia-compliant subsidiaries. Meanwhile, Morocco’s central bank plans to set up a central sharia board to oversee the sector. In its current form, the proposed legislation appears to address the tax issue well. It provides for the use of special purpose vehicles (SPVs), while transfers of real estate between sukuk originators and SPVs would not face double taxation.

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