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February 25, 2010updated 05 Jun 2017 11:39am

BNP sets up in Morocco, eyes Egypt

Africa is likely to be the slowest-growing region measured by wealth generation in the coming years, but there are some pockets of the continent which are being targeted by private banks Morocco, where BNP Paribas has started private banking services, is one country seen to have such potential

By Rodrigo Amaral

Africa is likely to be the slowest-growing region measured by wealth generation in the coming years, but there are some pockets of the continent which are being targeted by private banks. Morocco, where BNP Paribas has started private banking services, is one country seen to have such potential. Rodrigo Amaral reports.

 

BNP Paribas has set its sights on Morocco to boost its private banking presence in the growing markets of North Africa. The French bank has announced the creation of a new private banking unit at its Moroccan subsidiary, BMCI, in order to tap a market that, although in its infancy, promises to provide considerable action in the future.

In recent years, Morocco has been going through a process of economic liberalisation that has managed to attract foreign investments and to accelerate growth. An increasing number of multinational companies have set up shop in the North African country to take advantage of incentives to develop sectors like financial services and call centres. As a result, the number of wealthy Moroccans is perceived to be on the rise too.

“Morocco has an interesting potential for the creation of millionaires today,” says Meryem Kabbaj, the head of BMCI-BNP Paribas Private Banking. “In the past three or four years we’ve been observing the emergence of wealthy Moroccans whose needs are much different from the service that banks offered them before.”

Meryem Kabbaj, BMCI-BNP Paribas Private BankingA study by the Casablanca-based subsidiary of Sia Conseil, a French consultancy, notes that some other factors are also driving the development of private banking in the country. For instance, Moroccans are making more use of banking services, and the offer of investment products is gaining in sophistication.

“Morocco’s economy has shown dynamism and is growing,” says Sia Conseil’s Matthias Poirier. “Lots of foreign investments from the United Arab Emirates, the United States and Europe are entering the country, and big companies have managed to keep the money in Morocco. And the financial markets are becoming better structured. The private banking market is still embryonic here, but we believe it could grow by 4 percent to 6 percent a year in the next five or six years.”

BMCI-BNP Paribas has decided to make its presence felt in the market by launching its dedicated private banking service that relies on the strength of the bank’s retail banking network.

With over 250 branches spread around the country, the bank has 50 year’s experience in the Moroccan market and claims to be particularly strong in the provision of services for Morocco’s companies.

“BMCI is a reference in corporate banking in Morocco. The majority of big companies are our clients, and so are many small and medium firms too. Therefore we are making a big effort towards their owners and executives. From our contacts with the business world, we’ve realised that we have in our retail banking network several clients who want to receive a differentiated service,” says Kabbaj.

“They are sophisticated clients with particular needs in areas like strategic financial planning, the transmission of wealth to future generations and so forth.”

Sophisticated services

For starters, the new private banking unit will work with a lean 15-strong team, including relationship managers, salespeople, marketing experts and investments advisers, with offices in Casablanca and Rabat, Morocco’s two wealthier cities, which host around 80 percent of all potential clients, according to Kabbaj. Next year, however, could see further expansion, as BMCI considers sending its private bankers to other parts of the country.

Kabbaj notes that several wealthy clients from outside the two main cities are already served by the retail network, so an eventual expansion would also tap into this pool of clients. As in other countries where BNP Paribas operates, the private banking unit answers to both BNP Paribas’ Wealth Networks in Paris and the top echelons of the local subsidiary – in this case BMCI.

The Moroccan experience, according to Kabbaj, will work as a laboratory for the spreading of BNP Wealth Management across the North African region. An OECD study estimates that the number of people with over $1 million of investable assets is growing by 3 percent a year in the Middle East and North African region, and the bank is looking at ways to capitalise on this development.

“BNP Paribas has big ambitions in global wealth management and one of the priorities is the development of private banking in the context of domestic retail networks,” Kabbaj points out. “That’s what we at BMCI are doing in Morocco and our experience is a pilot for the development of private banking in other countries in the region where the bank has a domestic retail presence, like Egypt or Libya.”

BNP Paribas is not the only French bank with ambitions in developing its presence in North Africa’s private banking market. But, according to Sia Conseil, the strategies vary from player to player.

The consultancy notes that SGMA, the Moroccan unit of Société Générale, opted to set up a dedicated private bank that is independent from the retail network in a quest to increase its exclusive status. Crédit Agricole’s Crédit du Maroc, for its part, relies on the retail network – but also in a team of financial advisors who answer directly to regional directors of the bank.

In any case, the consultancy believes that the tactic that seems to be bearing the best results in the Moroccan market is the establishment of VIP agencies that provide differentiated services to wealthy clients, either recruited from the retail network or lured from elsewhere. And a new development has been the emergence of small firms that provide financial advice to the wealthy, says Poirier.

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