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Morocco’s central bank reported a decline in annual profit for 2025 after lower income from monetary policy operations and higher provisions offset stronger returns from foreign exchange reserves.

Bank Al-Maghrib said net profit fell to 5.74 billion dirhams ($620 million) in 2025 from 6.46 billion dirhams a year earlier, according to its annual financial statements.

The bank attributed the decline mainly to lower revenue from monetary policy operations following interest rate cuts, alongside a sharp increase in operating costs linked to more than 1 billion dirhams in risk provisions against potential market and interest rate shocks.

The drop partly reflects the gradual shift in global monetary conditions after several years of aggressive tightening by the U.S. Federal Reserve and the European Central Bank, which had previously boosted returns on central bank operations and reserve management.

Bank Al Maghrib said income from managing foreign exchange reserves rose by 1.2 billion dirhams, supported by stronger bond returns and investment income, helping cushion the broader decline.

The central bank also cited lower returns from money market placements as international rates eased, while extraordinary charges increased after the settlement of a solidarity contribution tax worth nearly 586 million dirhams.

Morocco’s central bank cut its benchmark interest rate twice in 2025 as inflation slowed sharply following the price shocks of recent years. Inflation eased below 1% last year after peaking above 6% in 2023.