Morocco

Morocco approves Islamic finance legislation

After months of delays, the Moroccan parliament finally approved the Islamic financial bill that will regulate Islamic banks and sukuk issues in the kingdom. This new bill will pave the way to financial institute to establish full-fledged Islamic banks in Morocco. It will be effective once it is published in Morocco’s official bulletin in coming days. Last month, Brahim Benjelloun Touimi, the CEO of “Banque Marocaine du Commerce Exterieur” (BMCE), said that the bank was preparing to launch an alternative subsidiary as a joint venture with a major Islamic financial institution from the Middle East, without revealing the identity of that financial institution.

Morocco's BMCE prepares to launch Islamic unit as Gulf ties grow

Morocco's BMCE Bank is preparing to launch an Islamic subsidiary as a joint venture with a major Islamic financial institution from the Middle East. Moreover, the Moroccan parliament is discussing a bill that would regulate Islamic banks and sukuk issues; approval is expected before the end of this year. Meanwhile, Tunisia is gearing up for its first sovereign sukuk issue, and in July, regulators in Jordan introduced rules for sukuk. Banks from Kuwait, Qatar, Bahrain and the United Arab Emirates have expressed interest in entering Morocco when its Islamic finance bill comes into force. Moroccan authorities are expected to guide the foreign banks toward partnering with local banks rather than establishing fully owned Islamic subsidiaries.

Clifford Chance advises on Islamic project financing

The transaction documents for the financing of the power project were signed over three days of meetings and included a ceremony in Rabat attended by Abdelilah Benkirane, prime minister of Morocco. Part of the financing was provided via a structured Islamic tranche from the Islamic Development Bank and it was not possible to use the more traditional procurement/forward lease structure typically seen in Islamic project financings. The Islamic tranche represents the first multi tranche cross border Islamic financing into Morocco and the first international Islamic project financing structured in this manner. Clifford Chance was delighted and proud to help create a new and innovative structure in Islamic project financing.

Islamic banks one step closer to fruition in Morocco

Morocco's Economic, Social and Environmental Council (CESE) weighed in on the Islamic bank bill on August 28th, proposing two changes. Two negative remarks were made by the CESE. The first related to a lack of consumer information necessary to avoid unfair marketing by Islamic banks. The second dealt with the need to clarify the roles of the National Council of Ulema and the central bank in the oversight of the sector. However, civil society activist and CESE member Hakima Naji opposed the intervention of the High Council of Ulema in the financial sector. She criticised the idea of religious management of finance and said that the central bank had the necessary ability to both traditional and Islamic banks.

Banque islamique au Maroc : la Banque Populaire se donne les moyens de ses ambitions

Banque Centrale Populaire – BCP a signé un partenariat stratégique avec Guidance Financial Group. Anticipant la promulgation de la nouvelle loi bancaire autorisant la création de banques islamiques au Maroc, la Banque Centrale Populaire (BCP) travaille discrètement depuis deux ans déjà sur le lancement d’une filiale dédiée à la finance islamique. Outre la mise en place des ressources humaines qualifiées et l’adoption d’un système d’information adéquat, la BCP s’est assurée l’expertise de Guidance Financial Group. Sur le marché des particuliers, Guidance propose notamment des produits conformes à la Charia pour l’achat immobilier et le financement des biens de consommation.

Maroc: le texte sur les banques islamiques voté

Lors d’une séance plénière, la Chambre des Représentants a adopté à la majorité des voix, le projet de loi n° 103.12 relative aux établissements de crédit et organismes islamiques. Le texte prévoit la création d’une place financière de dimension régionale et internationale pour incorporer ce segment de la finance internationale, soulignant la nécessité d’offrir une gamme de produits et de services financiers non seulement aux citoyens résidents mais aussi aux MRE, dont les pays d’accueil offrent des produits de type finance participative. Ce texte a été adopté par 75 voix pour et 19 absentions.

Thomson Reuters Releases A Report on Morocco's Islamic Finance Market

Thomson Reuters released a country report on Islamic Finance in Morocco in collaboration with the Islamic Research and Training Institute (IRTI) and the General Council for Islamic Banks and Financial Institutions (CIBAFI). Based on exclusive retail consumer and corporate surveys, the report estimates that Islamic banking assets could potentially reach US$8.6 billion by 2018, with a profit pool of between US$67 million and US$112 million for Islamic finance providers. The national retail consumer survey indicates Moroccan Islamic banking assets could potentially reach up to 5% of total banking assets by 2018. However, Moroccans know very little about Islamic financial products, the report adds. Islamic banking and Takaful laws are expected to be passed by the Moroccan parliament this year.

Maroc: les actifs financiers islamiques devraient peser entre 5,2 et 8,6 milliards de dollars en 2018

Les actifs financiers islamiques devraient peser entre 5,2 et 8,6 milliards de dollars au Maroc en 2018, selon le rapport intitulé «The Islamic Finance country reports». Ce rapport, réalisé par Thomsom Reuters en collaboration avec l’Institut islamique de recherche et de formation (IIRF) et le Conseil général des banques et institutions financières islamiques (CGBIFI), estime que les actifs financiers islamiques devraient représenter ainsi entre 3 et 5% du total des actifs bancaires au Maroc en 2018. Le rapport énumère, cependant, un certain nombre de faiblesses qui doivent être surmontées afin de libérer le potentiel de la finance islamique au Maroc. En plus, le parlement marocain devrait adopter prochainement une loi régissant les activités des banques islamiques dans le royaume.

Morocco: Bill for introduction of takaful submitted

Morocco's finance ministry has submitted a bill to the General Secretariat that will introduce takaful in the country.
A ministry official said the bill will enable the formation of takaful firms as separate entities instead of being units of insurers. If all processes move ahead as planned, takaful could be introduced in Morocco by the end of 2014.

ICD and EBRD sign MoU to support SMEs in Egypt, Jordan, Morocco and Tunisia

The European Bank for Reconstruction and Development (EBRD) and the Islamic Corporation for the Development of the Private Sector (ICD) have signed a Memorandum of Understanding developing joint collaboration to support SMEs in Egypt, Jordan, Morocco and Tunisia. Under the terms of the memorandum, the EBRD and the ICD will aim to establish a $120 million investment fund, to develop and to financially support SMEs across the southern and eastern Mediterranean region (SEMED). Various financing products will be used such as equity and quasi-equity.The two institutions will contribute to the SME Fund, as well as exploring additional institutional investors and donor streams in order to provide further SME financing and technical assistance required in the region.

CORRECTED-MIDEAST MONEY-Morocco hopes regulation will aid second Islamic finance drive

Morocco is set to give Islamic finance a second try, counting on closer regulation and a clearer legislative framework to resolve problems which plagued its first attempt in 2007. Morocco's parliament is considering a detailed bill that would regulate Islamic banks and issues of sukuk, and its passage - which could occur this year - is expected to prompt some Moroccan banks to establish dedicated sharia-compliant subsidiaries. Meanwhile, Morocco's central bank plans to set up a central sharia board to oversee the sector. Moroccan officials are also looking to develop Islamic finance in areas outside banking. Moreover, the ministry is studying the operations of real estate investment funds.

Morocco hopes regulation will aid second Islamic finance drive

Morocco is set to give Islamic finance a second try, counting on closer regulation and a clearer legislative framework to resolve problems which plagued its first attempt in 2007. Morocco’s parliament is considering a detailed bill that would regulate Islamic banks and issues of sukuk, and its passage – which could occur this year – is expected to prompt some Moroccan banks to establish dedicated sharia-compliant subsidiaries. Meanwhile, Morocco’s central bank plans to set up a central sharia board to oversee the sector. In its current form, the proposed legislation appears to address the tax issue well. It provides for the use of special purpose vehicles (SPVs), while transfers of real estate between sukuk originators and SPVs would not face double taxation.

ICD partners with Al-Ajial to invest in Moroccan private sector

Saudi-based Islamic Corporation for the Development of the Private Sector (ICD) has signed a memorandum of understanding with Morocco’s Al-Ajial Funds (Al-Ajial). Through this partnership, ICD and Al-Ajial Funds will establish a framework of cooperation in order to co-invest in potential projects within Morocco’s private sectors. The ICD is particularly interested in Al-Ajial Funds’ experience in supporting Morocco’s private sector, according to ICD chief executive Khaled Al-Aboodi.

Morocco's Attijariwafa Bank looks to boost Islamic finance

Attijariwafa Bank, one of the biggest banks in North Africa, will boost its Islamic subsidiary as soon as the Islamic finance bill passes parliament. Morocco's parliament has started to discuss a bill regulating Islamic banks and sukuk issues after months of delays, after the Islamist-led government adopted it last month. Parliament's approval will be the last step before fully-fledged Islamic banks can be established in Morocco. However, a revolution in the Moroccan banking sector is not expected since the market is very competitive, and Moroccans are too sensitive to product prices. Islamic finance banks are called participative banks under the Moroccan legislation.

Morocco hopes for Islamic finance rules by end-2014

Draft Islamic banking and insurance regulations have been prepared in Morocco and could be passed by parliament before the end of next year. Morocco has been seeking to develop Islamic finance for about two years, partly as a way to attract Gulf money and fund the huge budget deficit. The government originally planned to issue its first sovereign Islamic bond this year but that plan appears to have been delayed. The Islamic finance laws could clear the way for Morocco to see its first conventional bank with an Islamic window, as well as sukuk issuance by private firms. Two or three private firms could tap the market fairly quickly after the laws are passed.

Morocco's first Sukuk being backed by the Islamic Development Bank

The Islamic Development Bank has proposed to buy Marocco's sukuk rather than offering the country another loan, according to General Affairs minister Mohamed Najib Boulif. However, the amount has not been set yet. Earlier this year, the Morocco agreed a $2.4 billion package with the IDB, under which it will receive $600 million each year from 2013 to 2016. It also raised $750 million last month in a two-part reopening of its $1.5 billion bond. The North African country is considering other financial reforms, such as that of the pension and tax systems. It will also deregulate prices for some basic goods in the next two weeks, its first step towards reducing subsidies. However, the timing has not been decided.

La Faisal Islamic Bank s'implantera prochainement au Maroc

L’installation au Maroc de la Faisal Islamic Bank appartenant au prince saoudien Mohammed Al Faisal Al Saoud n’est qu’une question de temps. En effet, la banque islamique n’attend que l’approbation du projet de loi sur la finance islamique qui devrait entrer en vigueur début 2014. Ce dernier ainsi que le ministre du Budget, Driss El Azami, se sont entretenus pour la deuxième fois avec les responsables de la banque sur le futur partenariat.

Morocco to sign $ 2.4 bn IDB loan deal

Morocco expects to sign a $ 2.4 billion loan deal next month with the Islamic Development Bank (IDB). The North African country has agreed a package with the IDB under which it will receive $600 million each year from 2013 to 2016. A small part of that sum will be a donation rather than a loan. A formal signing will be held in May. Moreover, Morocco is expected to raise around $ 1.5 billion this year by selling its first sukuk, with a final decision on borrowing to be taken by July. Morocco’s government has said it will limit its public debt to 60 percent of GDP despite the rising budget deficit.

Morocco central bank plans central sharia board

Morocco's central bank has started talks with a body of Islamic scholars on establishing a central sharia board to oversee the country's fledgling Islamic finance industry. The board, composed of scholars and financial experts, would rule on whether instruments and activities complied with sharia principles. Moreover, the government plans to submit to parliament a bill regulating Islamic banks, which will be called participative banks under the legislation. Parliament's vote is expected by the last week of April.

Still springtime in North Africa? [Banker Middle East]

North Africa is moving towards the development of the Islamic financial industry as a response to the protests in several countries of the Arab world. Although there are some difficulties to overcome like low banking penetration and limited development of retail banking in general, there ist still potential for growth and progress. However, until a more stable political environment is provided, Shari'ah-compliant banking will be a niche market in North Africa.

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