Determinants of market share of commercial banks in Morocco: impact of capital structure and physical network density

Abstract

This study analyzes the determinants of commercial banks' market share in Morocco, focusing on the impact of capital structure and physical network density. The objective is to understand how these factors influence banks' competitive position in the context of Morocco's evolving banking sector. Our methodology relies on a quantitative analysis of panel data covering the period 2014-2023 for the country's ten main commercial banks. Results reveal a significant positive relationship between the capital ratio and market share, with a 0.8% increase in market share for each percentage point increase in the capital ratio. Physical network density also shows a positive impact, although its importance diminishes with increasing digitalization. The study highlights significant transformations in the sector, including decreased state and French capital participation, as well as an increased concentration trend.

Keywords: Banking market share, Capital structure, Physical network, Digitalization, Moroccan banking sector

JEL Classification: G21, G32, L11, O33

Paper type: Empirical research