Morocco: Insurance sector could invest nearly $3bn in private equity
Source: Middle East Insurance Review | Jul 2023
The insurance sector could invest up to MAD30bn ($2.95bn) in private equity, according to the Moroccan Federation of Insurance and Reinsurance Companies (FMSAR). Currently, private equity accounts for only 8% or MAD18bn of the total assets under management in the insurance sector that exceed MAD220bn.
FMSAR director-general Bachir Baddou said, “Investing in equity is important. Not in private equity per se, but rather in listed stocks, which represent more than 45% of the total assets under management of insurance companies. This demonstrates an appetite for investing in equity.”
He was speaking at the 10th Capital Investment Conference organised last week by the Moroccan Association of Capital Investors, reported the news website Medias24.
He said, “For private equity, we can count on 15% of our technical provisions or nearly MAD30bn. We are very far from it. However, private equity is going to be more and more favoured by insurers — we have understood this for two or three years. This stems from the fact that there has been a significant drop in yield on the Casablanca stock exchange that has not been in top form. Insurers are therefore looking for additional returns with fixed income instruments and listed shares.”
He said, “For an insurance company what is fundamental is liquidity even if we are long-term investors. We make trade-offs and sometimes we can’t wait for the long term.” M