The International Finance Corporation and German financial services group EOS are planning a €60 million facility to purchase non-performing loans from Moroccan banks, including debts owed by individuals and small, medium-sized and large businesses.
The project, listed under IFC project No. 52193, would also cover real estate assets acquired by financial institutions during debt recovery efforts. It is awaiting approval, with a board review scheduled for Oct. 15, according to the IFC.
What does the deal mean for borrowers?
The planned sale of non-performing loans would not cancel or reduce borrowers’ outstanding debts. Instead, it would transfer the right to collect and manage those debts from the original bank to the investors acquiring them.
According to the IFC, the facility is intended to help borrowers settle their financial obligations while allowing financial institutions to free up capital tied to non-performing loans and redirect it toward new lending.
The IFC also expects the investment to support the development of a more competitive market for distressed assets in Morocco.
“Banks shouldn’t remain burdened by nonperforming loans and the real estate they seize during the recovery process,” economic expert Mehdi Fakir told Hespress English.
Fakir said holding such assets can put pressure on banks’ balance sheets, particularly when the value of properties changes over time.
The planned transaction comes as non-performing loans in Morocco continue to increase. Their volume has grown by an average of about 6% annually over the past decade, reaching 104.7 billion Moroccan dirhams ($11.4 billion) at the end of June 2026, up about 1.9% from 2025.
The sharpest increase was recorded in 2020, when bad loans rose by about 15% amid the COVID-19 pandemic, lockdowns and the resulting economic slowdown.
For borrowers, the key change under the proposed facility would therefore be who manages and collects the debt, rather than the amount owed. Any changes to repayment arrangements would depend on the terms agreed with the entity that ultimately acquires the loans.
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