Banks: The SREP Could Impact Dividend Distribution

In an interview with Finances News Hebdo, Fitch Ratings experts expressed concerns that the implementation of the SREP by Bank Al-Maghrib could significantly impact the dividend distribution policies of Moroccan banks. To maintain their Tier 1 ratio above 11%, banks may need to scale back on lending and retain a larger portion of their profits to strengthen their capital reserves. This increased profit retention could lead to a temporary moderation in shareholder distributions while banks work to consolidate the capital required by the new regulatory framework. Fitch experts emphasize that this presents a delicate balance between adhering to new regulatory requirements and maintaining attractiveness for investors.