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Tunisia: Young and barely at the helm, but big ambitions for the UIB

A busy man (44 years old exactly) and just 9 months at the head of the UIB, this énarque and economist who worked for 10 years at the General Inspection of “Société Générale”, is in fact an establishment figure of the UIB.

He joined it in 2015 as the liquidity program director. A year later, he is already deputy CEO of the bank.

This means that there are no secrets for him. This allows him, in July 2017, to become the CEO.

With the good legacy left by his board chairman, Mondher Ghazali already has a clear roadmap.

His ambition, of which he talks to AfricanManager, is to “continue over the coming years to increase our revenues at a steady pace, above 11% per year, to lower our cost / income ratio below 45% and to maintain a Return on Equity (RoE) level above 20%.”


The bank has just closed the 2017 financial year with a growth in BNI and a net profit of 18.8%. What were globally the main moments and the levers of this growth?

The results recorded in 2017 are the result of UBI’s sound and profitable growth strategy, based on a balanced model covering all markets of individuals, professionals and businesses, on rigorous management of costs and risks and on a strong priority given to the development of human capital. All of our businesses contribute to accelerating growth and good financial performance.

With respect to retail banking, we have a leading position that we continue to consolidate with determination by expanding our network (5 new branch openings in 2017), by continually improving the customer experience and focusing on innovation, as is the case with our award-winning mobile application at the Tunisia Digital Awards 2017.

In the corporate banking business, we are taking a new step each year, developing our Business Centers and capitalizing on our recognized expertise especially in Trade Finance, Cash Management, Structured Finance and supporting our clients in Africa.

That expertise also feeds on our membership in a major international group and has been crowned by the 2018 award granted by Global Finance to the UIB as the best bank in Tunisia in international trade finance.

How did the bank’s key ratios, including those of liquidity, risk and NPL, behave?

All the regulatory ratios and thresholds provided for in the BCT circulars, whether the division and the risk coverage or the liquidity ratio, are respected by the UIB with a comfortable margin at 31 / 12/2017, and have been so throughout 2017.

In particular, the rate of non-performing loans (NPL) declined significantly to 8.1% end of 2017 against 9.4% end of 2016, with a coverage rate of 77% (including reserved agios) which is among the best in the banking sector.

On the other hand, the solvency ratio improved by more than 20 basis points to 11.13% and the Tier One ratio by 50 basis points to 8.1%, demonstrating the capacity of the UIB to generate, thanks to its profitability and the good control of its risks, the necessary capital to continue and accelerate further its development at the service of its customers and the economy.

What is the degree of dependence of the UIB on the BCT on refinancing and injection of liquidity?

With our broad base of customer deposits, which has one of the best growth in the sector, and our access in good conditions to the capital markets (interbank, bond and international lenders), our recourse to the refinancing of the BCT is remarkably limit.

On an annual average, it does not exceed 1% of the size of our balance sheet or 0.5% of the total volume of intervention of the BCT.

What is the bank’s position in financing the economy and in which niches in particular?

At UIB, we put the financing of the economy and the support of the needs of our customers at the heart of our mission.

With an annual increase of more than 800 MD, we position ourselves in 2017 as the 2nd private bank, by the additional volume of financing of the economy.

That performance that reflects the good momentum of commercial conquest and the renewed confidence of our customers.

With our balanced business model, covering all markets for individuals, professionals and businesses, these financings are highly diversified and we are gaining market share in all segments.

As a long-time partner of large dynamic companies and a leading player in the retail market, the UIB is also paying close attention to the SME and professional markets, where we aim to double our outstanding credit over the next three years.

Since the end of 2017 and throughout 2018, we have been organizing a large series of information and training days across the country for professionals and SMEs, in partnership with Proparco, to bring our services closer to our customers, improve their access to finance and advise them in their growth and investment strategies.

The bank resumed paying dividends after a number of years of absence. Do you feel that the UIB has completed its restructuring and transformation, or are there still other steps to be taken?

The UIB resumed the distribution of dividends in 2015 for the 2014 financial year and has continuously returned to its shareholders an increasing share of its recovered profitability.

This was the signal that we have clearly turned a page by restructuring and adapting our balance sheet, our organization and our business and operational model, now totally customer-centric.

We have put in place the foundations for a rigorous control of risks and costs, a prerequisite for any sustainable development process that is today an integral part of our corporate culture.

The restructuring phase started in 2008 is behind us and the UIB has opened a new page in its history, a page of conquest and differentiation embodied in the ambitious objectives of our 2017-2020 strategic plan.

That said, we consider that in a changing banking sector, transformation and adaptation are a permanent exercise and that the work must be continually put back on the job in order to continue to anticipate, in a quick and efficient way, the major changes in our environment, be they technological, regulatory, societal or environmental, and meet the new expectations of our various stakeholders.

You have just taken the reins of the bank. What will be your roadmap?

It is fully in line with the strategy of conquest and differentiation that we launched in early 2017 and which we are working in tandem with Mr. Kamel Néji, our Board Chairman. This strategy is articulated around 4 axes:

Being a relational bank of reference in Tunisia recognized for its expertise and the commitment of its employees, giving its customers and the economy the international reach and the innovations of the Société Générale Group;

– Continue the adaptation of our business model and the expansion of our offerings with a strategy of conquest in the markets of the Company and the high-end clientele, while strengthening our leadership in the individuals market with a market share 15%;

– Constantly optimize our operating model in terms of quality, efficiency, risk control, compliance and innovation, thanks to the commitment of our employees and the opportunities offered by technological changes;

– Pursue the development of our human capital by cultivating our talents and affirming the exemplarity of our managerial values and further disseminating our responsible, warm culture open on its environment.

This roadmap should allow us to continue over the coming years to increase our revenues at a steady pace, above 11% per year, to lower our cost / income ratio below 45%, to maintain a level of ROE (Return on Equity) above 20% and to perpetuate the upward trend of the dividend paid to our shareholders.

Above all, it aims to allow us to continue our rise in the list of Tunisian banks, to be the preferred bank in our markets and to continue to inspire pride and sense of commitment to our employees.

The BCT has recently increased its key rate, thus impacting the cost of credit in general. Do you think this could impact the banking business in general and its results and those of the UIB in particular?

The monetary policy tightening measures taken by the BCT at the end of December 2017 (widening of the corridor on either side of the key interest rate to 100 basis points) then beginning of March 2018 (rate increase by 75 basis points to 5.75%), are intended to curb the acceleration of inflation registered for several months.

That mission is at the heart of the Central Bank’s mandate. They will reduce real interest rates, which were negative, to levels more in line with the phase of the economic cycle in which we find ourselves.

Traditionally, the rate hike is rather favorable to the banks’ results. The impact on banking activity, however, will largely depend on the dynamics of these deposit-taking decisions.

Because, we must not forget that the rise in rates was accompanied by an increase in the remuneration of savings.

If this desirable movement – especially if it is supported by the measures favoring the “Decashing” of the economy – takes place, it will result in an improvement of the bank liquidity, a reduction of the intervention of the Central Bank and, in fine, a greater focus of banks on their intermediation role for the benefit of financing the economy.


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