Moody's highlights the positive effect of Morocco's removal from the FATF gray list

The American rating agency Moody’s underlined the positive effect of Morocco’s removal from the gray list of the International Financial Action Task Force (FATF), noting that this decision strengthens confidence in the national financial system.

This “announcement is positive for local banks and the wider national financial system, as it will reduce reputational risk stemming from increased levels of oversight by the International Financial Action Task Force, and build confidence in the Moroccan financial system. ,” Moody’s said in a note commenting on the FATF decision.

For the American agency, this decision will facilitate the relations of Moroccan banks with international correspondent banks, clearing houses and investors by reducing the risk of delays in the clearing and settlement of cross-border payments and receipt transactions, and by supporting capital inflows into the country.

Moody’s also notes that Moroccan banks will continue to maintain good efficiency ratios, stating that Attijariwafa bank, Groupe Banque centrale populaire, Bank of Africa-Groupe BMCE and Crédit du Maroc, had a solid cost / income ratio of 48% in the first half of 2022 and benefit from a solid and reinforced regulatory framework, while the large national banks have sophisticated risk management practices.

The American rating agency points out that Morocco has strengthened its legal and regulatory framework for the fight against money laundering and the financing of terrorism, recalling in this regard the adoption of Law No. 12-18 relating to the fight against money laundering.

This law has made it possible to strengthen the national system for implementing targeted financial sanctions by creating a national commission responsible for the application of sanctions and enhanced surveillance measures according to a risk-based approach, indicates the same source, adding that this text also made it possible to strengthen the system of pecuniary and disciplinary sanctions, broaden the list of offenses and increase the pecuniary penalties applicable to persons found guilty of money laundering.

Moody’s also indicated that Morocco has set up a national financial intelligence authority whose mission consists in particular in proposing legislative, regulatory or administrative reforms to fight against money laundering and the financing of terrorism.

In this context, the rating agency points out that Bank Al-Maghrib contributed to the drafting of Law No. 12-18 and its related implementing texts, and intensified training and awareness-raising actions on through workshops for the staff of the compliance units of financial institutions, noting that the central bank of Morocco carried out in 2021 several control missions to financial institutions, mainly relating to the assessment of the compliance and effectiveness of measures put in place to combat money laundering and the financing of terrorism.

Moody’s also indicated that in 2022, the Moroccan Capital Markets Authority published a circular bringing together the obligations related to the fight against money laundering and the financing of terrorism incumbent on persons subject to the control of the Authority, with regard to the new legislative and regulatory provisions, adding that this body has also updated its guide to combating money laundering and the financing of terrorism.

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