The financial performance of digital transformation: evidence from Moroccan banks

Houda Mahboub and Hicham Sadok ()

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Abstract: Purpose The digital landscape today is not just a current reality but a driving force that requires careful investment. Companies are spending more on Digital Transformation (DT). This study aims to investigate and measure how digital affects the financial performance of Moroccan banks. Design/methodology/approach This study uses a quantitative methodology, specifically relying on Structural Equation Modelling to analyse the financial data of eight selected Moroccan banks that hold approximately 90% of the total assets of the banking system. The analysis spans the period from 2007 to 2022, which is distinctly segmented into two sub-periods: the pre-digital era (2007–2014) and the digital era (2014–2022). These periods are subjected to comparative analysis to determine whether the transition into the digital era has measurably influenced banking performance, as operationalised and reflected by the Net Interest Margin (NIM). Findings The results indicate that digital has not yielded a statistically significant impact on banking performance in Morocco. Consequently, the considerable investments in digital initiatives appear to be driven more by mimicry or competitive necessity than by a financially and rationally substantiated DT strategy. Therefore, it is incumbent upon Moroccan banks to critically re-evaluate their current digital strategies and adjust concrete investment decisions to ensure a more effective value capture from their digital initiatives. Originality/value This research contributes to the existing literature by addressing the relationship between digital and financial performance from an NIM perspective within the context of Moroccan banking, relatively underexplored. Furthermore, this study addresses a recognised population gap, uses authentic, non-textual financial data analysis and incorporates the critical variable of non-performing loans, which is a major determinant of risk and performance for financial institutions.

Date: 2026-05-19
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Published in Journal of Financial Reporting and Accounting, 2026, 21 (1), pp.1-20. ⟨10.1108/JFRA-04-2025-0314⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05731470

DOI: 10.1108/JFRA-04-2025-0314

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