The liquidity requirements of Moroccan banks intensified, reaching an average weekly need of 111.6 billion dirhams (MMDH) in the first quarter of 2024, up from 100.9 MMDH in the previous quarter, according to Bank Al-Maghrib (BAM). This surge is largely attributed to the expansion of fiduciary money, as detailed in BAM’s recent monetary policy report following its second quarterly meeting held in Rabat.

To address this, BAM increased its injections to 123.9 MMDH, which included 46.7 MMDH in 7-day advances, 49.1 MMDH through repurchase agreements, and 28.1 MMDH in guaranteed loans under programs supporting the financing of very small, small, and medium-sized enterprises (TPME).

In this context, the average residual duration of BAM’s interventions extended from 51.2 days to 63.2 days, while the interbank rate remained aligned with the key rate.

The report also indicates a slight easing of bank liquidity needs, averaging 110.2 billion dirhams between April and May 2024.

Treasury and deposit market trends

In the Treasury bond market, rates continued to decline in the first quarter, particularly for long maturities, with a general stabilization observed in April and May.

The issuance rates for certificates of deposit saw a slight increase in Q1 2024. The interest rates on 6-month deposits rose by 7 basis points (bps) to an average of 2.54%, while 12-month deposit rates remained steady at 2.86%.

Conversely, the minimum remuneration rate for savings accounts was set at 2.73% for the first half of 2024, down 25 bps from the previous semester. Consequently, the overall financing cost for banks recorded a slight quarterly decrease of 2.3 bps.

Recent data from April 2024 show near stability in 6-month deposit rates at 2.4% and a 14 bps increase in 12-month rates to 2.96%. The survey by BAM on lending rates for Q1 2024 indicates that the average overall rate remained stable at 5.4%.

Credit rates by sector

For personal loans, the rates increased by 15 bps to 6.09%, with consumer loan rates rising by 4 bps to 7.22%, and housing loan rates decreasing by 2 bps to 4.81%.

For corporate loans, rates dropped by 4 bps to 5.26%, with a 5 bps decline to 5.3% for cash facilities, a 30 bps reduction to 5.19% for real estate development loans, and a 21 bps increase to 5.11% for equipment loans.