In Morocco, no financial institution is allowed to carry out banking operations without the green light from Bank Al-Maghrib, the country’s central bank. This requirement also extends to mergers and acquisitions involving banks. Every proposal undergoes a formal review process that includes input from the Credit Institutions Committee, which brings together representatives from the central bank and the Ministry of Finance. Legally, a decision must be made within 120 days of the file being submitted.
There’s little room for uncertainty in this process. Since May 2015, a detailed circular has outlined the documentation required for all applications. These include a comprehensive overview of the project, a clear breakdown of funding sources, ownership structure, corporate governance plans, and operational capabilities. Central to the review are systems for risk management, internal controls, compliance with data protection laws, and frameworks to combat money laundering and terrorist financing.
Foreign banks hoping to enter the Moroccan market face additional scrutiny. Not only must their proposals meet Morocco’s standards, but they also undergo a review of the regulatory oversight in their country of origin. Participatory banks face even more layers of approval—they must demonstrate alignment with rulings from the Higher Council of Ulema and explain how they will manage investment deposits in accordance with Islamic finance principles.
Bank Al-Maghrib controls the pace of the process. Depending on the nature of the transaction or the profile of the applicant, the central bank may request further documentation at any stage.
Once authorized, banks are expected to adhere to a robust regulatory framework that mirrors international standards, particularly those set by the Basel Committee. The goal is clear: to maintain a strong, transparent, and resilient financial sector. Prudential ratios are used to assess a bank’s solvency and liquidity, taking into account both on-balance sheet assets and off-balance sheet commitments.
But the regulatory scope goes beyond just the numbers. Sound governance, effective risk management, and strong internal controls are equally critical. Banks are required to develop a comprehensive risk map, covering credit, liquidity, interest rate, market, concentration, country-specific, and operational risks. Their accounting practices must align with the national banking accounting standards, especially regarding loan provisioning and loss recognition.
Transparency is a cornerstone of the system. Banks must publish both individual and consolidated financial statements, along with key disclosures about their capital adequacy and risk exposures.
The legal framework for combating money laundering and terrorist financing has been significantly reinforced. Law 43-05, strengthened by reforms in 2021, brought major institutional and procedural upgrades. These include a revamped Financial Intelligence Unit, the launch of a register for beneficial ownership, and mechanisms for enforcing UN Security Council sanctions—collectively creating a sharper, more responsive compliance system.
Bank Al-Maghrib enforces these rules through a two-pronged supervision strategy. One arm is ongoing monitoring, which involves analyzing the data and reports submitted by banks. The other is on-site inspections carried out at regular intervals. Additionally, the central bank has a specific mechanism for monitoring Moroccan banking subsidiaries abroad, particularly in Africa. It works closely with foreign regulators to ensure a coordinated response to cross-border financial risks.
