Morocco is actively pursuing reforms to enhance its legal framework surrounding the recovery of non-performing loans (NPLs), as the government collaborates with financial institutions to foster a more efficient partnership between the judiciary and the banking sector. During a national seminar held in Rabat, Justice Minister Abdellatif Ouahbi highlighted the urgent need for a structured dialogue between judicial authorities and banks to effectively tackle the growing issue of distressed bank debts.
In his address, Ouahbi underscored that the seminar serves as a vital platform for dialogue, aimed at sharing expertise on the multifaceted nature of debt recovery, which intertwines legal, economic, and financial dimensions. He expressed concern over the escalating volume of NPLs, which he warned could jeopardize the stability of the financial system, erode trust in economic transactions, and hinder the ongoing financing necessary for Morocco's economic growth.
Moreover, Ouahbi pointed out the significant disparity in the operational speeds of banking activities versus judicial processes, a gap that complicates effective debt recovery. He called for actionable solutions to bridge this divide, emphasizing the importance of synchronized efforts between the Ministry of Justice and Bank Al-Maghrib. This collaboration has already birthed a working group comprising representatives from key judicial and banking institutions, tasked with evaluating the current state of the NPL market and proposing necessary reforms.
Among the proposed measures is the establishment of a digital platform that would facilitate electronic transactions and communications between courts and banks, aimed at streamlining procedures. Additionally, plans were reiterated to create a jurisprudence platform to enhance stakeholders' access to judicial interpretations of banking laws, thus promoting a more informed legal environment.
Furthermore, Hicham Balaoui, Attorney General at the Court of Cassation and Head of the Public Prosecutor’s Office, reported that NPLs constituted 8.3% of total bank loans as of January 2026, which translates to nearly MAD 100 billion (approximately $10 billion). Balaoui advocated for revisions to the legal frameworks governing enforcement procedures, alongside enhancements in judicial expertise and the management of distressed assets, to ensure a more robust recovery process.
As reported by moroccoworldnews.com.
