Morocco: Bank loans to real estate sector stood at $22.3bn at the end of August

Oct 30, 2017 | Ecofin Agency

Overall loans granted by Moroccan commercial banks to the real estate industry stood at 211.7 billion dirhams at the end August 2017, thus a bit more than $22.37 billion. Year to year, this is up 4% compared to 2016.

This is the highest annual increase since the month of June 2016, reads the sectoral report of the Central Bank of Morocco, Bank Al Maghrib. This overall performance however hides a slight disparity. Indeed, most of the loans comprise credits to the housing sector which amounted to 194.5 billion dirhams, at the end of August 2017, up 5% compared to the same period in 2016. Meanwhile, loans to real estate developers were estimated at 16.5 billion dirhams at the end of August this year, thus 6.5% down on an annual basis. More generally, loans provided by Moroccan banks to the kingdom's economy have kept increasing (+5.1%) till the end of August, but more moderately than in 2016, at the end of July (+5.8%). The highest performance was recorded by loans for equipment which soared by 14% over the reference period, standing at 133.3 billion dirhams at the end of August. Compared to July 2017, it is up 3.1%. Despite the lending market faring well in Morocco, it should be noted that more and more borrowers fail to pay their debt. Indeed, outstanding debt for real estate loans stood at 63.8 billion dirhams over the period of reference, with most of the debt being held by non-financial firms (38.4 billion dirhams) and households (24.4 billion dirhams).