This is not an attempt to defend the banks, they have their own institutions to do that. But it is worth reminding those who view bank profits with suspicion that banks, in Tunisia as everywhere else, operate with other people’s money: deposits from households and businesses, both demand deposits and long-term savings, as well as the savings of ordinary citizens.
These funds are largely low-cost resources for banks, yet they are the foundation of their lending activity, to businesses, households, and, more recently, even interest-free to communitarian companies, which have quietly become the backbone of the new economic model President Kais Saied is seeking to impose, particularly on Tunisia’s financial institutions.
An injunction delivered alongside a report
On Saturday, July 11, 2026, at the Kasbah Government Palace, Prime Minister Sarra Zaafrani Zenzri received the Central Bank of Tunisia’s (BCT) 2025 Annual Report from Governor Fethi Zouhair Nouri. The ceremony was ceremonial; her remarks were anything but.
The meeting came after two previous encounters involving the banking sector, first between the Central Bank and commercial banks, then between the Minister of Finance and the same bankers.
According to the Prime Ministry, the Prime Minister “stressed the need for the banking sector to engage seriously in promoting investment and not limit its objective to material profit, as financing of investment by the private banking sector remains very weak and does not meet the challenges of the current period.”
Interestingly, the French version of the statement softened the wording by omitting the word “seriously.” The discrepancy is revealing: the message is harsher in Arabic, the language of official political discourse, than in French, the language of markets and international lenders.
She also urged the Central Bank to “fully exercise its role” in encouraging banks to finance both public and private investment.
Other people’s money
The significance of that directive becomes clearer when one considers the scale of the resources involved.
By the end of 2025, Tunisian banks were managing TND 122.97 billion in customer deposits, according to the Central Bank’s annual report presented to the Prime Minister. On average throughout the year, deposits stood at nearly TND 119 billion.
This included TND 35.39 billion in largely non-interest-bearing current accounts and TND 40.24 billion in savings deposits, which have earned the minimum regulated interest rate of 6% since January—equivalent to a real return of roughly 0.7 percentage points above June’s 5.3% inflation rate.
It is this money, the deposits and savings of ordinary citizens, that the government is asking banks to mobilize without placing too much emphasis on “material profit.”
Yet profitability is not merely a shareholder’s preference. It is what enables banks to return deposits to their owners, pay savers returns that exceed inflation, absorb loan losses, and comply with regulatory capital requirements.
Asking banks to lend without regard for profitability ultimately means risking other people’s money.
Two standards, two systems
The scene took place nearly two years earlier in the office of the then Minister of Finance at the Kasbah. The story was later recounted by its principal participant.
The minister summoned the chief executive of a state-owned bank and instructed him to purchase more Treasury bills.
The banker objected that doing so would weaken the bank’s prudential ratios.
The minister reportedly exploded:
“I’m talking to you about the State’s ratios, and you’re talking to me about the bank’s ratios?”
The CEO was dismissed a few days later.
The fact that the minister later recounted the episode without the slightest embarrassment says enough: from the Kasbah’s perspective, nothing about it seemed unusual.
That same mindset underpins the July 11 directive, which explicitly singled out the private banking sector for providing what it described as “very weak” investment financing.
The distinction is obvious. In public banks, the State does not encourage, it instructs.
Recent events have reinforced that lesson. Since President Kais Saied’s visit to the headquarters of the Banque Nationale Agricole (BNA) in September 2023, carrying loan files under his arm, Tunisia’s Financial Judicial Division has opened investigations into loans allegedly granted without sufficient guarantees.
Several former executives of state-owned banks have been detained over loans extended to businessmen deemed inadequately secured. In April 2026, an appeals court increased the prison sentence of a former chairman and CEO of a public bank from three to five years, while those still facing proceedings continue to benefit from the presumption of innocence.
The paradox could hardly be greater.
A public banker risks prison for lending without adequate safeguards, in other words, without sufficient concern for profitability and risk, while a private banker is criticized for exercising too much financial discipline.
Lending too freely may lead to prosecution. Lending too cautiously may invite political condemnation.
Putting the symptom on trial
Ironically, the government’s criticism of insufficient investment financing is contained in the very report presented to the Prime Minister.
The Central Bank’s 2025 Annual Report shows that outstanding customer loans increased by only 3.4%, reaching TND 111.89 billion, while credit to private businesses, the segment that generates value added, employment and growth, rose by just 2.3% to TND 67.46 billion, representing a decline in real terms.
The characterization of private-bank lending as “very weak” is made without providing a breakdown by lending institution. The report classifies credit by borrower, not by whether the lender is a public or private bank.
Yet the report itself identifies the underlying cause.
Banks’ holdings of Treasury bills surged by 39.4%, an increase of TND 7.27 billion, reaching TND 25.71 billion.
In a single year, banks purchased nearly twice as many government securities as they extended in new loans to all customers combined, TND 7.27 billion versus TND 3.69 billion.
Interest income from Treasury bills jumped by 40.5%, while net claims on the Central Government now account for 33% of the counterparts to the money supply, compared with an average of just 11.2% before the pandemic.
This is the crowding-out effect in its purest form.
The State absorbs national savings through the banking system, leaving only scraps for the private sector.
Meanwhile, the 2026 Finance Law plans to cover nearly three-quarters of the government’s TND 27.06 billion financing requirement on that same domestic market.
Blaming banks for preferring Treasury securities over entrepreneurial risk amounts to criticizing behavior that government financing policy itself has made perfectly rational and which public banks are often instructed to adopt.
Treasury bills are the one asset that exposes bankers neither to prosecution nor political criticism. At least one banker has already lost his job over misunderstanding that distinction.
The day the Treasury borrows less, everything will improve
The Kasbah’s statement implicitly outlines a new doctrine: bank profitability is to be tolerated only conditionally, rather than recognized as a legitimate objective.
Interest-free financing for community companies was already an early indication of that shift.
Yet the arithmetic contained in the report presented that very Saturday is difficult to dispute.
As long as the State absorbs the bulk of banking resources through risk-free borrowing, no amount of official exhortation, even delivered in Arabic and reinforced with the word “seriously”, will redirect credit toward productive private investment.
The day the Treasury borrows less, banks will lend more to everyone else.
And it will become clear that the real problem was never the banks’ appetite for profit, but rather that of their largest customer: the State, which urges some, prosecutes others, and borrows from all.
