Morocco’s Non-Performing Loan Market: A Balancing Act Between Economic Opportunity and Social Risk
Morocco’s central bank, Bank Al-Maghrib, has launched an initiative to establish a secondary market for non-performing loans (NPLs). This move aims to address the significant rise in NPLs, a figure that has reportedly ballooned. This new market presents a complex scenario, posing both potential economic benefits and social risks that require careful consideration.
The decision to create this market comes as NPLs continue to be a concern for Morocco’s financial stability. While precise figures can be difficult to obtain and vary depending on the source, reports suggest a substantial NPL volume. This situation can restrict lending, hinder economic growth, and tie up valuable capital within the banking system. By creating a secondary market, Bank Al-Maghrib hopes to unlock this trapped capital, allowing banks to offload these bad debts and free up resources for new lending. This, in turn, could stimulate economic activity and support businesses seeking access to credit.
A secondary market for NPLs can attract specialized investors, often international firms with expertise in managing
