The Evolution of Stress Tests and Their Usefulness in the Moroccan Banking Context Pre/Post Covid-19

Abstract

Stress tests, key tools for assessing the resilience of banks to economic shocks, have gained increasing importance in Morocco, particularly driven by global regulations and lessons from financial crises. Prior to the pandemic, these tests focused on traditional scenarios (interest rate fluctuations, real estate market dynamics). However, COVID-19 highlighted the need to integrate emerging risks (market volatility, supply chain disruptions, socio-economic impacts), compelling banks to adopt more complex and diversified methodologies.

This work aims to provide a general overview of the evolution of stress tests before and after the COVID-19 pandemic and their utility in the development of the Moroccan banking sector.

The article examines how banking stress tests in Morocco have evolved in response to new crises, especially the Covid-19 pandemic. Before 2020, these tests focused mainly on traditional risks (interest rate changes, real estate market fluctuations). However, the pandemic highlighted the need to incorporate emerging risks (market volatility, supply chain disruptions, socio-economic impacts). Moroccan banks had to adopt more sophisticated methodologies, supported by Bank Al-Maghrib’s tighter regulations aligned with international standards. The crisis also accelerated banking digitalization and improved financial inclusion. Today, stress tests have become essential strategic tools to ensure the stability and resilience of Morocco’s banking system.

Classification JEL : C12, E60, H61, G18

Paper type: Theoretical Analysis