Morocco Welcomes Five New Islamic Banks

The Central Bank of Morocco and the Ministry of Economy and Finance have announced that five Sharia compliant banks have been granted permission to begin operating in the country. The banks will offer Halal credits, and the banks will be referred to as participatory banks. Bank Al-Maghrib is yet to open its doors to foreign banks. So far, three conventional banks will be able to offer participatory banking products. The country has had several attempts in the past to allow halal banks, but the regulatory process has been a hurdle. It is estimated that between 150-200 agencies will open in order to better monitor and assist the progress of the banks. The High Council of Ulemas, which is the body that oversees the Islamic religious policy of the kingdom, will be permitted to have a “Sharia Committee for Participatory Finance.”

The statement of the bank declared that the High Council’s committee would be the only body allowed to determine if a bank’s products and services are in accordance with moderate Islamic precepts. The Minister of Economy and Finance, Mohamed Boussaid, said the country should launch the first set of Islamic financial titles (sukuks) by the middle of the year. “These new financial tools should contribute to the development of the participatory banks,” the minister said. “These tools also provide alternative solutions for the financing of projects carried out by both the state and the private sector, through the issuance of participating bonds using the securitization vehicle,” Boussaid added. The country expects the banks to be successful, given the anticipation of the people. A recent survey showed that as much as 98 percent of the population are open to participatory banking products, with nearly half of them willing to pay a premium if they end up costing more.