BMCE BANK OF AFRICA GROUP · BMCE Bank of Africa : Large presence in Africa 72.85% 37% 32.38% 59%...
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BMCE BANK OF AFRICA GROUP NOVEMBER 2018
Transcript of BMCE BANK OF AFRICA GROUP · BMCE Bank of Africa : Large presence in Africa 72.85% 37% 32.38% 59%...
BMCE BANK OF AFRICA GROUP
NOVEMBER 2018
Content
PROFILE OF BMCE BANK OF AFRICA GROUP 3
GROUP PERFORMANCE 24
BMCE BANK OF AFRICA & ITS ENVIRONMENT 31
PROFILE OF BMCE BANK OF AFRICA GROUP
4
Other operations
Specialised Financial Services
BMCE Bank Plc
Overseas operations
Investment banking
BMCE Capital SABMCE Capital BourseBMCE Capital Gestion
Eurafric InformationLocasomCID
Bank Of AfricaLCB BankBanque de Développement du MaliBMCE International Holding
Personal & Professional BankingCorporate BankingMarket Operations
SalafinMaghrebailRM ExpertsMaroc FactoringEuler Hermes Acmar
A Multi Brand Universal Banking Group
4
5
15,031
Employees
31
Countries
1,653
Branches
6.1 millions
Customers5
Cote d’IvoireDjiboutiEthiopiaGhanaKenya
RwandaSenegalTanzaniaTogoTunisia
MoroccoBeninBurkina FasoBurundiCongo Brazzaville
MaliMadagascarNigerUgandaD.R.Congo
NORTH AMERICA
AFRICA
EUROPE
ASIA
GermanyBelgiumSpainFrance
ItalyNetherlandsPortugalUnited Kingdom
ChinaCanadaUnited Arab Emirates
BMCE Bank of Africa Worldwide
Exchange Rate EUR / MAD: 11.0694 & USD / MAD: 9.5 as of June 2018
Net Income AttributableTo Parent
1 125 M MAD101.6 M EUR118 M USD
Net Banking Income
6 500 M MAD587 M EUR684 M USD
Equity Attributable To Parent
17.3 Bn MAD1.6 Bn EUR1.8 Bn USD
Total Assets
296.5 Bn MAD26.8 Bn EUR31 Bn USD
Customer Loans
178.1 Bn MAD16 Bn EUR
18.7 Bn USD
Customer Deposits
194.2 Bn MAD17.5 Bn EUR20 Bn USD
31COUNTRIES
15,031EMPLOYEES
1,653 BRANCHES
~6,1 Millions
CUSTOMERS
BMCE Bank of Africa key figures - June 2018
6
Customer Loans
114.2 Bn MAD
10 Bn EUR
12 Bn USD
Customer Deposits
125.9 Bn MAD
11.4 Bn EUR
13 Bn USD
Net Income
1 005 M MAD
90,8 M EUR
105.8 M USD
Net Banking Income
3 291 M MAD
297 M EUR
346 M USD
Total Assets
192.8 Bn MAD
17 Bn EUR
20 Bn USD
Gross Operating Income
1 578 M MAD
142.6 M EUR
166 M USD
5,367EMPLOYEES
735BRANCHES
~2,4 Millions
CUSTOMERS
BMCE Bank June 2018 Figures -Parent Company-
7Exchange Rate EUR / MAD: 11.0694 & USD / MAD: 9.5 as of June 2018
BMCE Bank Rating
8
Local currency deposits : Ba1/Not-Prime
Foreign currency deposits : Ba2/Not Prime
Subordinated debt : B1
Bank’s Financial Strength Rating : D- credit
assessment : ba3
•Outlook : Stable
Moody’s – June 2018
Capital Intelligence – September 2018
•Financial Strength : BBB-
•Foreign Currency Deposits
•Short term : A3•Long term : BBB -
•Support : 2
•Outlook : Stable
Local currency deposits : BB+
Foreign currency deposits : BB+
Support rating floor : BB+
Viability Rating : b+
Support Rating : 3
•Outlook : Stable
Fitch Ratings – August 2018
9
1959 – 1994
From a Public Bank…
1995 – 2006
…to a universalprivate Bank…
2007 – 2018
…towardscontinental
Banking Group
• 1959 : Creation of the Bank
• 1965 : Opening of the Tangier free zone branch
• 1972 : 1st Moroccan bank to establish an overseas presence through its Paris based branch
• 1975 : Listing on the Stock Exchange
• 1988 : Creation of Maroc Factoring
• 1989 : Opening of BMCE International Madrid
• 1994 : Creation of BMCE Capital Bourse and BMCE Capital Gestion
•1995 : Privatization of the Bank
•1996 : Issue of a 60 M$ GDR program in London
•1997 : Creation of Salafin, a consumer credit company
•1998 : Creation of BMCE Capital
•2000 : Opening of Representative Offices in London and Beijing
•2004 : 1st non European bank to receive a social responsibility rating
•2006 : Creation of Axis Capital, the Tunisian Investment Bank
•2007 : Start of the business activities of BBI London
•2008 : Acquisition of a 35% stake in Bank Of Africa
•2011 : 1st Bank in Morocco and in the MENA region to be ISO 14001certified for the environment
•2013 : Increase of the bank’s equity stake in BOA to 72.6 Issue of the first non-sovereign Eurobond of 300 M$
•2014 : Opening a representative office in Canada
Opening of 2 BMCE Euroservices branches in the Netherlands
• 2015 : Opening of BOA Rwanda
New denomination “BMCE Bank of Africa” to reinforce the group’s Pan African ideology stake increased for: BOA Group to 75%, / la Banque de Développement du Mali to 32,4% / la Congolaise de Banque to 37%
• 2016 : First bank that issued “Green Bond” loan during the Cop 22• 2017 : Participation to the official launch of ‘Principles for positive impact financing’• 2018 : Launching of BMCE Shanghai Branch
Nearly 60 years of Development
9
As of June 2018
RMA 29.87%
SFCM; 0.51%
EMPLOYEES 1.37%
FREE FLOAT18.05%
BFCMCM-CIC Group
26.21% FINA
NC
EC
OM
GR
OU
P3
6.3
5%
10
RMA
A leading player in the insurance market, a trendsetter among North
African’s enterprises, with an expanded and solid distribution
network
BFCM - CM-CIC GROUP
2nd retail bank in France, provides financial services to more than 13
millions clients, pioneer in electronic banking and a major actor in the
professional market
FINANCECOM
Private Moroccan group, leader in the country with a pan African impact. Present in different business areas
with a potential economic growth as banking, insurance, telecom, new technologies, asset management,
media…
CDG GROUP
First institutional investor in Morocco and a reference on a national level
concerning some professions as public financing of investment projects, saving management
activities…
Stable & Diversified Shareholding Structure
11
BMCE Bank of Africa : Large presence in Africa
72.85%
37%
32.38%
59%
11
1989 : First Moroccan Bank to be established in sub-Saharan
Africa during the end of the 1980s, beyond a successfulrestructuration of La Banque de Développement du Mali. It isthe first Bank in the country in which BMCE Bank owns todaymore than 32%
2003 : following a successful restructuring program, an
acquisition of 25% of LCB Bank was made. Furthermore, it hasbecome the first bank in Congo Brazzaville. BMCE Bank ownstoday 37%.
2007 : Acquisition of 35% of Bank Of Africa, a major Pan
African banking group present in 18 countries in the Africancontinent. Nowadays, BMCE Bank owns 73% of its shares.
2006 : Launch in 2006 of Axis Capital in Tunisia,
specialized in asset management, stock brokerage and advisoryservices
BMCE Bank
72.85%BIO
2.03%
FMO8.94%
Proparco3.73%
Private Sector African
Investors12.45%
As of June 2018
•BMCE Bank Of Africa : Firstbank strongly present in thesub-Saharan’s market
• A network of more than700 branches that intervenein more than twentycountries in Africa
•FMO : Dutch development’sagency focused on privatesector’s financing projects,created in 1970 by the Dutchgovernment which holds 51%of its capital
•PROPARCO : a financialinstitution jointly owned byAgence Française deDéveloppement (AFD) andprivate shareholders fromdeveloped and developingcountries
•BIO : a Belgian institutionspecialized in developmentfinance in 2001 to promote thegrowth of the private sector inemerging and developingeconomies
12
Shareholding’ Structure of the Group BOA
1Euro= 655.957 F CFA
18Countries
5,841Employees
576Branches
3.7 Millions Accounts
NET BANKING INCOME
238.8 M EUR
CONSOLIDATED NET INCOME
70.6 M EUR
CUSTOMER LOANS
3.8 Bn EUR
CUSTOMER DEPOSITS
5.3 Bn EUR
TOTAL ASSETS
7.9 Bn EUR
SHAREHOLDERS EQUITY ATTRIBUTABLE
TO PARENT
566.5 M EUR
BOA Group’s consolidated figures - June 2018
13
14West Africa Central Africa East Africa Southern Africa North Africa
BOA-Benin
1989
Number of Branches: 48
BOA-Burkina Faso
1997
Number of Branches: 50
BOA-Côte d’Ivoire
1996
Number of Branches: 36
BOA-Ghana
2011
Number of Branches: 26
BOA-Mali
1983
Number of Branches: 63
BOA-Niger
1994
Number of Branches: 28
BOA-Senegal
2001
Number of Branches: 55
BOA-Togo
2013
Number of Branches: 11
BOA Madagascar
1999
Number of Branches: 92
BOA-DRC
2010
Number of Branches: 16
BOA-Ethiopia
2014
Representative Office
BOA-Kenya
2004
Number of Branches: 32
BOA-Tanzania
2007
Number of Branches: 26
BOA-Uganda
2006
Number of Branches: 35
Burundi
Banque de Crédit du Bujumbura2008
Number of Branches: 21
BOA-Djibouti
2010
Number of Branches: 8
BOA-Rwanda
2015
Number of Branches: 14
DRC Congo
MaliNiger
Kenya
Uganda
Djibouti
Benin
Ghana
Côte d’Ivoire
Burkina Faso
Togo
Senegal
Ethiopia
Burundi
Rwanda
BDM SA-Mali
1983
Number of Branches: 54
LCB Bank
2009
Number of Branches: 20
BMCE Bank
1959
Number of Branches: 734
Tunisia
2006
BMCE Capital Tunis
Tunisia
BMCE Bank of Africa, the second largest Pan African Group
14
15
BOA - BMCE Bank of Africa
Development of synergies in many areas : Finance, Risk Management, General Control, Compliance, IT …
BOA - SALAFIN
Acquisition of a management tool of amicable and contentious debt recovery for individuals and enterprises
Implementation of a complete platform for automobile financing
BOA - BMCE Euroservices
Development of synergies between BMCE EuroServices
and BOA-France in the money transfers 'domain
BOA - RM EXPERTS
Establishment of an organization to manage the contentious
recovery
BOA - BMCE Capital
Joint-venture with BMCE Capital covering activities of advisory, equities brokerage and asset
management
BOA - BMCE Bank International Holding
(London, Paris, Madrid)
Development in Africa as a specialist of Corporate &
Investment banking
Intra-Group synergies benefiting Africa
15
4%
European operations – a mixed performance
BMCE Bank International Holding
BIH, the Group’s European platform which brings together the operations of itstwo European subsidiaries, BBI London and BBI Madrid, contributed 4% or MAD50.8 million to net income attributable to shareholders of the parent company infirst half 2018
Contribution to net incomeattributable to shareholders of the parent company
BMCE Bank International Plc London posted a mixed set of results in first half2018: the subsidiary was impacted by (i) interest rate hikes which impacted itsfunding costs (ii) exceptional capital gains on fixed income instruments in theprevious year and (iii) a decline in net interest income on international markets
BBI London and Paris
BBI MadridBMCE Bank International Madrid (BBI Madrid) saw its net income grow by 27% toEUR 3.8 million as a result of a 16% increase in net banking income and lowerexpenses
16
New partnership agreement signed between BMCE BankFoundation and the Ministry of National Education regarding anew cooperation programme between both parties in pre-schooleducation
BMCE Bank Foundation, a leader in promoting sustainable development for more than 20 years
17
Visit by the Minister of National Education to the Bouskoura
Medersat.com school, enquiring about the Medersat.com
educational model, the way in which various pre-school classes
function and how digital technology is used
More Medersat.com schools awarded the Eco-school label
from the Mohammed VI Foundation for Environmental
Protection, taking the total number of schools designated as Eco-
schools to 25
BMCE Bank Foundation’s operations in sub-Saharan Africabolstered, taking the total number of schools to 6, in Senegal,Congo Brazzaville, Mali, Rwanda, Djibouti and 1 socio-educational centre in Senegal
17
Nearly 200 units built and fully-equipped, specialising in pre-school and primaryeducation, covering all 16 of Morocco’s regions
18
456 teachers, 48% of whom are female, supervised and managed by 13 regional educational supervisors
22,000 pupils schooled, 50% of whom are girls and high school diplomasawarded to 800 students in 2017 alone
230 hours/year of in-house training for teachers in a variety of disciplines (languages/sciences/pre-school)
62 schools providing a pre-school and primary education to approximately 10,400 pupils in the 2018-19 academic year from socially disadvantaged backgrounds
BMCE Bank Foundation’s main achievements in first half 2018
6 Medersat.com schools renovated and refurbished
18
‘CapValoris’ launched, a comprehensive solid waste recovery fundingsolution
‘Ligne Bleue’ established, a EUR 20 million funding line for Morocco-
based water and sanitation projects
A responsible business and an array of undertakings
19
Meeting organised between the European Bank for Reconstruction and
Development (EBRD) and the Moroccan Association of Women
Business Leaders (AFEM) on the theme of Supporting Women’s
Entrepreneurship in Morocco
‘Women in Business’ funding line introduced for women entrepreneurs,
offering support in the form of training, advice and solid financial backing
Subscribed to the ‘Mainstreaming Climate Action within Financial
Institutions’ initiative in conjunction with the EBRD, the AFD, Yes Bank,
HSBC, the IsDB and BOAD
19
To address the growing problem of youth unemployment and promote
entrepreneurship as a means of enhancing youngsters’ employability,
BMCE Bank Group, in partnership with the Kingdom’s most prestigious
training institutes, has set up an incubator network, a catalyst for job and
wealth creation
Incubator network, a robust approach to promotingentrepreneurship
20
After signing a partnership agreement with ISCAE in 2017, another was
signed with Casablanca Hassan II University’s Faculty of Legal, Economic
and Social Sciences, to establish an educational bank branch and an
incubator aimed at supporting a dozen or so start-ups every year
20
21
1. Composante Technologique, créatrice de valeur
2. Potentiel à adapter et à reproduire au niveau panafricain
3. Impact durable et social
Over 17,000 entrepreneurs joined the journey, representing 142 countries,including all 54 African countries in Africa since the award launch in 2015
33 businesses funded from 13 African countries (Cameroon, Ethiopia, Ghana,Kenya, Liberia, Morocco, Mozambique, Nigeria, Rwanda, Senegal, South Africa,Tanzania, and Uganda)
New categories for the 4th edition 2018 of the AEA program, namely innovation
and Sport. Innovation meets the challenges of economic and societal development
in Africa and Sport strengthens economies, improves health and vehicle values
such as perseverance, courage, integrity and collaboration
More than 112 entrepreneurs from 32 countries participated in the Boot-Campduring the first 3 editions
More than 500 partner-mentors from over 30 countries, Africa, Europe, Asia,North America and Australia
21
Key Performance Indicators Since the Award Launch in 2015
22
AEA contributes positively on the African continent development
Thanks to the Award funding and mentoring, the 33 winners of the first editions invested in the growth and
development of their businesses, created jobs and launched products and services with high social impact
Transformation of funded projects and startups into
sustainable and revenue-generating businesses
2281 Jobs created
An increase of
277%
264,000 New Clients
and increaseof 370%
Annual revenues increased by
383%
22
23
BMCE Bank Of Africa, awarded for the 5th year at the CSR Arabia Awards 2018in the Financial Services category
Certified ‘’Top Employer 2019’’ by the Top Employers Institute, a globalcertification company recognizing excellence in the conditions that employerscreate for their employees
« Socially Responsible Bank of the Year 2018 » for the 2nd year, by the AfricanBanker Awards 2018
« Top Performer, CSR Morocco 2018» awarded by Vigeo Eiris, a non financialratings agency, for the 5th consecutive year in the ‘’Environment’’ category
A Group internationally distinguished for its Excellence
First Moroccan bank to be OHSAS 18001-certified by Bureau Veritas for itsoccupational health and safety management system, after obtaining ISO 14001environmental certifications in 2011 and ISO 50001 for energy in 2016
ISO 9001 - 2015 certification for the purchasing management activity and theimplementation of a structured quality management system
Bronze medal in the ‘Best Integral Phygital Compain’ category for its‘Connected bank’ communications campaign to promote and broadcast theBank's entire range of innovative solutions and services
23
BMCE Bank of Africa awarded by Africa Investments Forum & Award ‘’GoldenAward’’ – Best Bank in Africa 2018
GROUP PERFORMANCE
25
Total Assets(In Billion)
Customer Deposits(In Billion)
Customer Loans(In Billion)
Shareholders’ Equity Attributableto Parent (In Billion)
Balance Sheet - June 2018 -
June 17
320 MAD29 €33 $
June 16
282 MAD26 €29 $
+8%
June 17
195 MAD18 €20 $
June 16
181 MAD17 €19 $
+6%
June 17
18.4 MAD1.7 €1.8 $
June 16
17.7 MAD1.6 €1.8 $
+11%
June 17
192 MAD17.5 €20 $
June 16
168 MAD15 €17 $
+4%
Exchange Rate as of June 2018 : EURO/MAD= 11.0496 - USD / MAD : 9.5
June 18
-7%
June 18
-1%
June 18
-7%
June 18
-6%
194 MAD18 €20 $
178 MAD17.5 €20 $
17.3 MAD1.6 €1.8 $
CAGRJune16-June18
+3%
CAGRJune16-June18
+3%
297 MAD27 €31 $
CAGRJune16-June18
-1%
CAGRJune16-June18
+3%
25
26
2011
208 MAD18.5 €24 $
2016
306 MAD29 €30 $
2015
279 MAD26 €28 $
+10%
2011
139 MAD12.4 €16 $
2016
190 MAD18 €19 $
2015
179 MAD16.6 €18 $
+6%
2011
12 MAD1.1 €1.5 $
2016
18 MAD1.7 €1.8 $
2015
17 MAD1.6 €1.7 $
+7%
2011
121.3 MAD10.8 €14.9 $
2016
180 MAD17 €18 $
2015
173 MAD16 €
17.5 $
+9%
Exchange rate as of as December 31st 2017: EURO/MAD= 11.1885 - USD/MAD : 9.3276
2017
313 MAD28 €34 $
+13%
2017
+5%
2017
+4%
2017
+2%
199 MAD18 €21 $
183.7 MAD16 €
19.7 $
18.7 MAD1.7 €2.0 $
CAGR2015-2017
+6%
CAGR2015-2017
+5%
CAGR2015-2017
+3%
CAGR2015-2017
+5%
Total Assets(In Billion)
Customer Deposits(In Billion)
Customer Loans(In Billion)
Shareholders’ Equity Attributableto Parent (In Billion)
Sustainable Balance Sheet Growth - December 2017 -
26
27
Net Banking Income(In Million MAD)
June 17
6 691 MAD609 €695 $
June 16
6 705 MAD617 €686 $
+13%
Breakdown of consolidated Net Banking Income
June 18
-3%
Weightingchange
3p%
-3p%
+13%
-2%
-35%
+1p%
Other Income
Market Operations
Fee Income
Net Interest Income
5%
8%
16%
71%
4%
5%
19%
72%
June 17 June 18
-1p%
CAGRJune16-June18
-2%6 500 MAD
588 €684 $
+17%
Net Banking Income By Business line
As of 30 june 2018
International
49%
(48%)
SFS
5%
(6%)
GABA
3%
(3%)
BMCE Bank
42%
(vs 42%)
Others
1%
(1%)
58.64%
53.10%
55.10%
53.10%
55.60%
57.66%
J-13 J-14 J-15 J-16 J-17 J-18
Cost to Income Ratio
55.10%
48.60%
50.50%
46.30%
51.30%52.99%
Parent accounts
Consolidated accounts
27
Operational Efficiency - June 2018 -
Exchange Rate as of June 2018 : EURO/MAD= 11.0496 - USD / MAD : 9.5
28Parent accounts
Consolidated accounts
2011
8 140 MAD725 €999 $
2016
12 990 MAD
1 219 €1 288 $
2015
11 817 MAD
1 096 €1 193 $
+10%
2017
+3% CAGR2015-2017
+6%13 368 MAD
1 195 €1 433 $
BMCE Bank43%
(53%)
SFS6%
(6%)
GABA3%
(3%)Others
1%(1%)
60.2%
56.5%58.7% 56.8% 58.1%
60.2%54.9%
60.7%56.9%
58.3%
2013 2014 2015 2016 2017
+1p%
-3p%
+14%
+5%
-39%
+1p%
Other Income
Market Operations
Fee Income
Net Interest Income
4%
9%
16%
71%
4%
9%
16%
72%
2016 2017
+1p%+30%
Exchange rate as of as December 31st 2017: EURO/MAD= 11.1885 - USD/MAD : 9.3276
Net Banking Income(In million MAD)
Net Banking Income by business line
Breakdown of consolidated Net Banking Income
Cost to Income Ratio
Weighting change %
Strong Net Income growth coupled with notable operationalefficiency - December 2017 -
International 48%
(47%)
28
29
International
BMCE Bank
Others
GABA
SFS
Earnings capacity - June 2018 -
44%(45%)
43% (41%)
June 2017
7%(7%)
6%(6%)
0%(2%)
June 17
1 288 MAD191 €202 $
June 16
1 250 MAD115 €128 $
+17%
1 111 MAD101 €115 $
1 074 MAD99 €
110 $
+8% -5p%
-2p%
Africa
Europe
Morocco
39%
4%
57%
34%
7%
59%
June 18June 17
-9.5%
June 18
-13% CAGR
June16-June18
-5%
1 005 MAD91 €
106 $
1 125 MAD102 €118 $
CAGRJune16-June18
-3%
-3p%
+1p%
-15p%
-47p%
29
Net Income Attributable to Parent(In million MAD)
Bank’s Net Income(In million MAD)
Net Income Attributable to Parent by business line
Net Income Attributable to Parent by geographic area
June 17June 16 June 18
Exchange Rate as of June 2018 : EURO/MAD= 11.0496 - USD / MAD : 9.5
Weighting change %
30
2011
850 MAD76 €
104 $
2016
2 036 MAD191 €202 $
2015
1 956 MAD181 €198 $
+4%
2011
545 MAD49 €67 $
2016
1 325 MAD124 €131 $
2015
1 304 MAD121 €132 $
+8% +0p%
+2p%
Africa
Europe
Morocco
32%
7%
61%
32%
9%
59%
201720162017
+2%
2017
+0% CAGR2015-2017
+2%
CAGR2015-2017
+7%1 325 MAD124 €131 $
2 036 MAD182 €218 $
48%
39%
9%6%-1%
International
BMCE Bank
Others
GABA
SFS40%
41%
10%7%
2%
2016 2017
-2p%
Net Income Attributable to Parent(In million MAD)
Net Income Attributable to Parent by business line
Bank’s Net Income(In million MAD)
Net Income Attributable to Parent by geographic area
Diversified Earnings Capacity - December 2017 -
Exchange rate as of as December 31st 2017: EURO/MAD= 11.1885 - USD/MAD : 9.327630
BMCE BANK OF AFRICA& ITS ENVIRONMENT
32
Source : IMF
Global economy, an uncertain start to the year
US economic growth accelerated to 2.9% in 2018, boosted by fiscal stimulus and a recovery incorporate investment. Consumer spending contributed significantly to domestic demand against abackdrop of low unemployment
After peaking in 2017, Eurozone growth slowed slightly. This gradual growth normalisation hasoccurred after a period of higher oil prices and the impact of a stronger euro while the Brexit effecton the UK economy is being increasingly felt
Emerging economies have gained growth momentum despite rising trade tensions. The recovery incommodity prices has offset the impact from monetary tightening – higher US interest rates
2.4% 2.3%
4.7%
6.9%
2.8%3.7%
2.2%2.9%
4.9%
6.6%
3.4%3.9%
Zone Euro Etats-Unis Pays Emergents Chine Afriquesubsaharienne
Monde
Economic growth 2017-2018
2017
2018e
32
Euro Zone United States Emerging countries China Sub-Saharan Africa The World
67
79
94 93
43
61
6.6%7.0%
4.3%
5.1%
1.4%
3.4%
0%
1%
2%
3%
4%
5%
6%
7%
8%
0
20
40
60
80
100
120
2004 -08 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018e
Comparison of GDP growth vs. Oil prices
Cours du pétrole(USD)
Sub-Saharan Africa, rebound due to an improvement in foreigntrade balances
33
Overall rebound in economic activity in sub-Saharan Africa, mainly due to an improvement in theeconomic outlook for oil-exporting countries. GDP growth, forecast at 3.5% in 2018, remains wellbelow the levels seen over the period 2000-2010
Improvement in foreign trade balances. The region’s current account deficit declined by 1.5percentage points from 4.1% of GDP in 2016 to 2.6% of GDP in 2017
Reduced inflationary pressure in a number of countries due to monetary tightening. Although stillhigh, inflation fell by 2.5 percentage points in 2017 to 10%
Source : IMF
33
Oil prices
WAEMU, growth momentum maintained, public deficits needmonitoring
Source : IMF
Internal and external imbalances remain high, as illustrated by the budget deficit at an estimated4.6% of GDP. In addition, public debt grew and the cost of servicing that debt remains high despiteforeign exchange reserves remaining broadly unchanged at 4 months
Regional prospects are positive assuming that oil prices remain at current levels, weatherconditions remain favourable and that budget austerity measures continue to be implemented
For the 7th consecutive year, regional growth will exceed 6% despite the negative shocks on theforeign trade front. The region’s main economies – Ivory Coast and Ghana – are expected to grow by8.3% and 7.4% respectively in 2018
6.6%
8.3%
6.7%5.8%
6.6%7.8%
7.2%
5.3%6.4%
7.4% 7.0%
5.0%
UEMOA Côte d'Ivoire Sénégal Mali
Real GDP growth within the WAEMU region
2016
2017
2018e
3434
WAEMU Senegal
East Africa, modest slowdown in 2017
Due to a combination of higher oil prices and drought, nearly all countries within the region registeredslightly slower growth in 2017 including Kenya (4.8%), Tanzania (6%) and Rwanda (6.1%)
The short-term growth trend for East Africa remains positive with growth likely to accelerate to5.8% in 2018, an increase of 0.6%
Source : IMF
Inflation is likely to reach 6.5% in 2017 before falling back to 4.6% in 2018 due to a recovery inagricultural production
5.4% 5.8% 5.9% 6.0%5.2% 4.8%
6.2% 6.1%5.8% 5.5%
6.8% 7.2%
Communauté de l'Afriquede l'Est
Kenya Rwanda Tanzanie
Real GDP growth within the East African Community
2016
2017e
2018p
35 35
East Africa Kenya Rwanda Tanzania
Source : FMI
CEMAC region, getting back on its feet
Growth is expected to exceed 1.7% after two consecutive years of recession. Cameroon stands outwith its economy registering robust growth at around 4% over the period, underlining the relativebenefits of economic diversification
Subdued pick-up in economic activity in 2018 for Chad (3.5%), Gabon (27%) and, to a lesserextent, the Republic of Congo (0.7%), due to higher oil prices
Significant improvement in the current account deficit, down from 13.8% of GDP to 4.3% in 2017,primarily due to an adjustment in the foreign trade balance, from 74% of GDP in 2016 vs. 13% ofGDP in 2017
-0.6%
4.7%
2.1%
-2.8%
0.3%
4%
1%
-4.6%
2.1%
4.6%
2.7%
0.7%
CEMAC Cameroun Gabon République du Congo
Real GDP growth within the CEMAC region
2016
2017
2018p
3636
Cameroon Gabon
Source: IMF
Congo
Republic of Congo, recovery expected in 2019
The Congolese economy suffered a deeprecession (-4.6%) in 2017 because of its over-reliance on the oil sector. Oil revenues fellsharply as a result of a 45% drop in the oilprice over the period 2014-2017.
As a result, public debt reached a record highof 119.1% of GDP, at a much higher level thanthe regional convergence target of 70% ofGDP.
The country’s public finances remain underclose scrutiny. Congo defaulted on acoupon payment on its USD 363 millionEurobond as well as making an accountingerror on part of its public debt.
As a result, negotiations with the IMFregarding new funding programmes havebeen postponed.
Source: IMF
The government has decided, however, to continueto invest in infrastructure as part of ongoing effortsto diversify the economy.
As a result, the forthcoming opening of a free-tradezone in the Pointe-Noire region will benefit thepetrochemicals, tourism and food-processingsectors.
As far as the outlook is concerned, the economy islikely to enter into a normalisation phase at the endof 2018 which should accelerate in 2019, assumingthat oil price remain at current levels.
6.8%
2.6%-2.8% -4.6% 0.7%
4.6%
2014 2015 2016 2017 2018e 2019e
Economic growth (%)
-16.7%
-27.2%-22.6%
-7.2%
3.9% 5%
2014 2015 2016 2017 2018e 2019e
Government budget balance(% GDP)
48%97% 115% 119% 110% 105%
2014 2015 2016 2017 2018e 2019e
Public debt (% GDP)
3737
A return to pre-crisis levels?
Moroccan GDP growth forecasts revised up due to a record cereal harvest of 103 million quintals.Non-agricultural GDP growth remains below the pre-crisis 5% growth rate
In 2019, sectors in which Morocco is globally competitive will see further growth while demandfor Moroccan goods is expected to increase with the result that growth, over time, should graduallyreturn to pre-crisis levels
HCP
Ove
rall
GD
P
4.1%
2017
Ove
rall
GD
P
Pri
mary
Seco
nd
ary
&
Tert
iary
Ove
rall G
DP
3.1% 3.2%
Ministèredes Finances
Growth forecasts 2018
3.6%
Ove
rall
GD
P
3.6%3.1%
HCPBAM
38 38
Ministry of Finance
39Source : GPBM
June 2017June 2016 June 2018
Banking industry registers growth in deposits and loans
Customer deposits (MAD billions)
831 869
+4%
898
+3%
Customer loans (MAD billions)
3% growth in deposits at industry level betweenJune 2017 and June 2018, driven by chequeaccounts (+7%) and savings accounts (+5%)
737778
+5%812
+4%
4% increase in customer loans, primarily due topositive growth (+11.5% year-on-year) inequipment loans
39
June 2017June 2016 June 2018
40Source : GPBM
June 2017June 2016 June 2018
Improving non-performing loan ratio in Morocco
Non-performing loans (MAD billions)
60.5 62.7
+3.6%
63.3
+1%
Improvement in Moroccan banks’ assetquality between June 2016 and June2018 as illustrated by a 40 basis pointdecline in the non-performing loan ratioto 7.7% in June 2018 versus 8% in June2017 and 8.2% in June 2016
8.2% 8% 7.8%
June 2017June 2016 June 2018
Non-performing loan ratio
Rise in non-performing loans containedat MAD 63.3 billion i.e. +1% at 30 June2018 vs. +3.6% at 30 June 2017
40
41Source: GPBM
A diversified banking sector
Commercial Banks Specialized Banks
Moroccan Banks Foreign Banks
41
Pu
bli
c/ S
em
i-p
ub
lic
Ban
ksP
riva
te B
anks
Promising prospects
STRENGTHS OPPORTUNITIES
Compliance with international standardsuntapped growth opportunities in Africa and growing
banking penetration in Morocco
Growing maturity of the banking sector Dynamic internal demand
Support to the modernisation of the Moroccan economy
Importance of sectoral policies and infrastructure projects
Weak exposure to international financial crisis Key rate declined at 2.25%
Presence of renowned and solid banking groupsLegal and regulatory progress in the Casa Finance City
Project
Growing extension in the branch network Development of crowfunding
Development of Low Income Banking Advancement of regulatory projects related to capital market
42
