Listed banks see their Net Banking Income up 12.1% in 2022

Listed banks saw their Net Banking Income (NBI) rise by 12.1% in 2022, exceeding the historical mark of TND 6 billion, according to a note on the banking sector’s activity indicators (Q4 2022), recently released by the stock market broker, Tunisie Valeurs.

This performance is mainly due to other revenues (+25% to TND 1.9 billion) and to the interest margin (+8.6% to TND 3.1 billion). The other revenues were up due to an intense activity of issuing State loans by the Treasury and a healthy foreign exchange activity at the level of the banks’ trading rooms.

The interest margin took advantage of a volume effect coupled with a favourable price effect (increase in outstanding loans coupled with the increase in the key rate by 100 basis points in 2022).

Net commissions increased by 4.6% to TND 1.3 billion.

With the exception of BTE, all the banks on the stock exchange showed positive developments in their NBI.

The mixed bank had a 3.2% drop in net income, to TND 61.1 million, due to the drop in its interest margin (-19.7%, to TND 20.5 million).

The listed banks also reported better productivity, thanks to the control of overheads (+5.3% to TND 2.8 billion according to Tunisie Valeurs estimates) and the strong generation of NBI.

The sector’s aggregate operating ratio fell by 2.9 percentage points to 44.5%.

The payroll coverage ratio by commissions rose by 0.6 percentage points to 71.2%.

// Outstanding deposits up by 8.7

As for deposits, Tunisie Valeurs reported a resilient collection activity during the past year, despite the gloomy economic context.

The listed banks posted an 8.7% growth in outstanding deposits to TND 85.2 billion.

“It seems that the tightening of monetary policy by the BCT operated in 2022, brandishing the weapon of rates (raising the director of 100 bp, generating an increase in the TMM of 54 bp on average over the year 2022 and the increase in the minimum rate of remuneration of savings of 125 bp between December 2021 and December 2022) boosted the return of savings to the banking circuit,” explained the stock market broker.

“All resources categories showed positive evolutions. However, it was time deposits and savings deposits that recorded the strongest growth (+13.3% to TND 26.3 billion and 9.3% to TND 26.8 billion, respectively).

All the banks on the stock exchange increased their outstanding deposits, which is, according to Tunisie Valeurs, a performance in itself in this morbid economic context.

// Acceleration of credit growth for listed banks

Besides, the year 2022 was characterised by an acceleration of credit growth for listed banks after a rather “dull” 2021.

After a decline in 2021 (+4.7%), the outstanding loans of the listed banking sector grew by 7.9% to TND 83.2 billion.

Despite the sluggish business climate, Tunisie Valeurs pointed out that the sector’s production was sustained by the good collection, the easing of pressure on the regulatory transformation ratio (credit/deposit ratio), the positive comparison base of 2021 which saw a noticeable slowdown in the production rate and the substantial repayments of Assimilable Treasury Bonds since the beginning of 2022, ensuring an inflow of fresh money to the banks (repayments of Treasury Bonds for TND 12.6 billion).

Despite a more sustained collection than the credit distribution, the banking sector saw its overall transformation ratio almost stagnate at 91.5%.

This observation is mainly explained by the decrease in the outstanding special resources (-2.2% to TND 5.8 billion).

In keeping with recent years, public banks continue to pull up the production of the sector.

The latter recorded an aggregate increase in the volume of their commitments of 10.1%, to TND 35.7 billion.

Private banks for their part experienced a 6.4% rise in outstanding loans to TND 46.7 billion.

All the banks on the stock exchange recorded positive developments in their outstanding loans, except for BTE.

The production of the former development bank with Tunisian-Emirati capital marked a respite (-3.2%, to TND 853.4 million in the volume of commitments) in 2022, to digest the solid growth posted over the period 2020-2021 (an average increase in the outstanding loans of 7.1%).

The BTE suffered a deterioration in the quality of its portfolio in 2021 (a rate of classified debts rising from 16.1% in 2020 to 18.9% in 2021) which undoubtedly prompted the bank to give priority to quality over volume.

Source: Agence Tunis Afrique Presse (TAP)

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