New Islamic Sukuk issuance to boost participatory banks' liquidity
Oriental Eco
In a press conference held on the sidelines of the 23rd Islamic Finance Stability Forum, Bank of Morocco Governor Abdellatif Jouahri confirmed that Morocco is preparing a new issue of Islamic sukuk (Islamic bonds), in consultation with the Ministry of Finance and the High Council of Ulema. The issuance aims to boost the liquidity of participatory banks and support the development of Islamic banking in the country.
Jawahiri confirmed that Morocco is planning to issue a second Islamic sovereign sukuk after the first issuance in 2018, in response to a question about the government's announcement in the 2025 finance bill memorandum that it intends to issue new sukuk.
The governor of the Bank of Morocco explained that work is underway at the technical level in coordination with the Ministry of Finance and the Supreme Council of Scholars to study the project and verify its conditions, noting that meetings began in 2023 to discuss issuing a sukuk worth 1 billion dirhams (about $100 million).
Jawahiri emphasized that the progress of this file is linked to obtaining the legal approval of the Supreme Council of Ulema, in addition to completing the technical conditions suitable for the Moroccan market, saying: “We cannot move forward without the opinion of the Supreme Council of Ulema, and discussions are ongoing to determine all the necessary aspects.”.
The new issuance aims to address the lack of liquidity in participatory banks, which is a major obstacle to the growth of Islamic banking in Morocco. “Currently, the volume of participatory financing is around 35 billion dirhams, while deposits do not exceed 12 billion dirhams, which indicates a structural imbalance that needs to be addressed,” Jouahri added.
Although the share of Islamic finance is still limited, accounting for about 2% of total banking assets, the sector has seen rapid growth of 27.6% between 2019 and 2024.
Moroccan authorities aspire to create a regulated sovereign sukuk market to attract institutional investors, including those from the Gulf states and the global Islamic finance market.
