Morocco’s local authorities are borrowing and spending more as infrastructure projects gather pace across the country.
The Fonds d’Équipement Communal, known as FEC, said loan commitments reached 779m dirhams by the end of March 2026, up more than 10% compared with the same period a year earlier.
Loan disbursements rose more sharply. They more than doubled year on year to 608m dirhams, reflecting what the bank described as the scaling up of projects launched by local authorities in recent years.
Outstanding loans to customers also increased. They stood at more than 27bn dirhams at the end of March, a rise of 1.4% from a year earlier.
The FEC, which finances regional and municipal projects, said it continued to focus on responsible investment by directing funding towards projects with social and economic impact while applying strict environmental and social standards.
The bank said environmental, social and climate risks are now integrated into its wider risk management system and financing approval process. It added that its Environmental and Social Management System is fully deployed and based on international standards with a policy of continuous improvement.
By the end of March 2026, all approved projects were classified under categories C and D in the bank’s environmental and social rating system. According to the FEC, these categories represent the most controlled risk profiles under international standards.
In a statement, the bank said this situation “confirms the evolution of its portfolio toward a contained environmental and climate footprint, while supporting projects that generate a positive social impact in the territories.”
Net banking income stood at 166m dirhams in the first quarter of 2026, remaining close to the level recorded a year earlier. The bank said the stability partly reflected lower interest rates introduced in 2025 on loans granted to local authorities.
The FEC also said it was continuing a financing strategy aimed at securing funding on competitive terms from domestic and international markets in order to offer local authorities better borrowing conditions.
Tier one capital reached 5.67bn dirhams at the end of March 2026, as the bank continued strengthening its financial base.
The lender plays a central role in Morocco’s advanced regionalisation strategy, which aims to give regions, provinces and municipalities greater control over development projects and local investment.
The FEC has also expanded its role in sustainable finance. Following updates to its Environmental and Social Management System in late 2024, the bank said it had aligned its financing policy with Morocco’s climate objectives, including support for climate resilient infrastructure projects.
Its international standing has also grown. In late 2025, the African Development Bank approved a €150m loan to the FEC to support sustainable infrastructure financing in Morocco.
