When the Covid-19 pandemic first hit, Morocco was already in the grips of a persistent drought that had badly affected its economy. The pandemic compounded the economic challenges facing the country, a largely service-based economy and major regional tourism destination, and put its banking sector — one of the most mature and robust in Africa — in the spotlight.
Bank Al-Maghrib (BAM), the country’s central bank, responded with a series of policies that have ensured that the sector remains resilient into the middle of 2021, despite the challenges facing both banks and the economy as a whole. Short-lived loan moratoria were supplanted by an expansive state-guaranteed loan programme, which underpinned modest credit growth seen over the previous year. The central bank also acted swiftly to cut interest rates and took measures to shore up liquidity as economic activity slowed in the early months of the pandemic.
