Moroccan banks to be probed over suspect high profitability
The country’s parliament will also probe the state-owned pension fund manager, and hopes to deliver its findings before the end of the year
Rabat — Moroccan legislators will investigate the profitability of banks before switching focus to cement makers as the government seeks to rally companies behind its efforts to revamp the economy and spur growth.
Parliament’s finance and economic development commission will probably start meetings with the central bank governor, the finance minister and industry representatives from April, said Abdellah Bouanou, the committee’s chair. It will aim to deliver its findings, which will include a probe of the state-owned pension fund manager, before the end of the year.
Morocco needs “a new generation of reforms”, he said. “To give strong impetus to the structural transformation of the national economy, banks must be asked about their obligations and accomplishments.”
While Morocco has avoided the upheavals that other countries in the region have faced, its economy is struggling to meet rising social demands, beset by poor harvests and weak demand from its key markets in Europe. Scarce rainfalls and the coronavirus are raising concerns over yet another year of slow growth.
Banks were shoved into the spotlight in October when King Mohammed VI ordered lenders in the North African country to open the credit taps for entrepreneurs and small businesses. The monarch’s address to lawmakers caused the committee to review its priorities and move banks ahead of a planned probe into cement companies, which it plans to look into over allegations of high prices and anti-competitive behavior, Bouanou said.
In the document detailing the committee’s terms of reference for the probe, lawmakers contrasted the “high profitability” of banks with declining credit approvals and lower deposits, rising non-performing loans and worsening macro-economic conditions.
Lawmakers are urging firms to set aside more money for “social and solidarity” projects, and better integrate the self-employed and the informal sector into the economy to “ensure social justice and a balanced distribution of wealth,” the document showed.
Focus will be paid to lending margins relative to the central bank’s benchmark rate; fees and commissions; the banks’ contribution to job creation; their commitment to fair competition; as well as their social and corporate responsibility programmes.
The committee also plans to investigate Caisse de Dépôt et de Gestion (CDG), which, in recent years, has financed several projects in the country, said Abdellatif Berroho, a member of the finance committee. An investigation by Morocco’s audit court found shortcomings with the state-owned pension fund manager’s investment policy and risk-management processes.
Hadi Chaibinou, the secretary-general of a banking industry group, declined to comment. Bouchra Ghiati, a spokesperson for a cement producers’ lobby group, declined to comment, saying the companies each need to comment individually. CDG spokesperson Hatim Seffar could not immediately comment