The insurance sector continued to show solid fundamentals and demonstrated its resilience despite the difficult international economic situation characterized by great uncertainty, according to the Committee for the Coordination and Monitoring of Systemic Risks (CCSRS), which met on Thursday at Bank Al-Mahreb headquarters (BAM). ).
On a technical level, at the end of the first three quarters of this year, the sector maintained a good growth rate of around 7.7% compared to the same period last year, to reach 42.4 billion dirhams (MMDH), BAM indicates in a press release on this 16th CCSRS meeting, noting that this development was supported by both the life insurance (+9.5%) and non-life insurance (+6.1%) branches.
On the financial level, the investments of insurance companies increased by 3% since the beginning of the year to 216.7 billion dirhams at the end of September. However, unrealized capital gains fell by 40.6% to 19.3 billion dirhams, mainly due to the decline in the stock market and the increase in secondary market interest rates.
In terms of profitability, net profit at the end of June was an improvement of around 11.3% year-on-year. In terms of solvency, the sector continues to generate an average margin of more than three times the required regulatory minimum.
Regarding the pension sector, the same source points out that the main basic schemes are experiencing “a difficult financial situation” globally characterized by “the importance of their implicit debt and of the depletion of their reserves at different horizons”.
The systemic pension reform should make it possible to establish balanced pricing, but also to absorb, in significant proportions, the uncovered previous obligations and thus to restore financial balances in the future, notes the press release.
After examining the situation of the financial system with regard to the observed and expected economic and financial trends, the CCSRS also pointed out that the development of macroeconomic conditions so far does not show any “major risks” that could threaten financial stability, but the vulnerabilities , arising from the external and internal environment (consequences of the war in Ukraine, drought, consequences of the pandemic, inflationary pressures, etc.) “call for vigilance and continue to make “subject to close monitoring” .
According to Bank Al-Maghrib forecasts, growth in the national economy should slow to 1.1% in 2022 before accelerating to 3% in 2023 and 3.2% in 2024, the same source recalls.
As for inflation, after a sharp acceleration in 2022 to 6.6%, it should moderate while remaining at a high level around 4% on average in 2023 and 2024.
As for the external position, the current account deficit should narrow to around 2% over the next two years, while official reserve assets should stand at 362.9 billion. in 2023 and then 371 billion in 2024, i.e. corresponding to almost 6 months of imports of goods and services.
With regard to public finances, the budget deficit will gradually decrease from 5.3% of GDP in 2022 to 4.6% in 2023 and 4% in 2024. Treasury debt, in turn, will decrease to 67.7% of GDP in 2023 and 66 .1%. in 2024.