In less than a year, the consolidated balance sheet of Tunisia’s non-resident banks shrank from TND 6.5 billion to less than TND 4.9 billion, a contraction of 25%.
This decline is not the result of a crisis but rather the abrupt end of a windfall that had artificially inflated the sector’s size. It also exposes the vastly different realities hidden behind the apparent homogeneity of Tunisia’s offshore banking segment.
The windfall and its end
For several years, offshore banks benefited from an exceptional opportunity: placing their foreign-currency liquidity with the Central Bank of Tunisia (BCT) at attractive yields amid high interest rates and the BCT’s structural need for foreign exchange.
These deposits mechanically boosted their balance sheets without requiring significant commercial activity.
Data from the Financial Statistics Bulletin (BSF) No. 233, published in January 2026, pinpoint the moment when this opportunity disappeared.
Offshore banks’ claims on the BCT stood at TND 1.064 billion in December 2024. By May 2025, they had fallen to TND 250 million, and by October 2025 they had reached a low of TND 116 million, representing an 89% decline in just ten months.
The sector’s total balance sheet contracted accordingly, losing TND 1.7 billion over the same period.
The main reasons were monetary easing, the reduction of the BCT’s key interest rate to 7%, and changes in the management of foreign-exchange reserves.
Offshore banks withdrew their funds and sought higher returns on international interbank markets.
Their primary assets reverted to what they have structurally always been: claims on non-residents, which now account for 68% of total assets compared with 64% a year earlier.
This recalibration provides a more accurate picture of the sector’s real activity. Excluding foreign-currency placements with the BCT, the actual size of the segment is probably between TND 4.5 billion and TND 5 billion.
The sector had been statistically inflated by a form of internal recycling: foreign currency collected from non-resident clients was redeposited with the BCT and incorporated into the country’s official reserves.
Three speeds, three business models
A closer look at individual institutions reveals that the term “offshore banking sector” is largely a statistical convenience. In reality, three very different groups have emerged.
ALUBAF: The outperformer
ALUBAF is expanding. The Tunisian subsidiary of the Libyan Foreign Bank, wholly owned by its parent, increased net banking income by 17% to USD 14.6 million in 2024 and posted net profit of USD 4.79 million for the second consecutive year.
Its strong performance is driven by its focus on intra-Maghreb trade, institutional clients, controlled risk costs of USD 2.4 million, and solid shareholders’ equity of USD 100.4 million.
Unlike some competitors, ALUBAF did not rely on foreign-currency placements with the BCT. It has remained focused on international trade finance, the purpose for which it was established in 1985.
TIB: Lower earnings but still profitable
The Tunis International Bank (TIB), Tunisia’s first offshore bank founded in 1982 and owned by Kuwait’s Burgan Bank through the KIPCO Group, recorded net profit of USD 10.5 million in 2024, down from USD 14.4 million in 2023, a decline of 27.2%.
Operating profit fell from USD 22.9 million to USD 19.8 million (-13.5%). However, the exceptional surge recorded in 2023, up 40% from 2022, was likely driven by a combination of favorable factors including the post-COVID recovery, interest-rate conditions, and strong business activity, some of which did not recur in 2024.
The return to USD 10.5 million reflects normalization rather than collapse.
Meanwhile, ABC Tunisia increased its capital in 2024 and wrote off non-performing claims that had been classified for more than five years, signaling balance-sheet cleanup and continued confidence in its business model. Shareholders’ equity reached TND 136 million at the end of 2024.
TF Bank: Surviving rather than growing
The Tunis branch of the Tunisian Foreign Bank (TF Bank), a French-law bank whose shareholders include STB and BH Bank among other financial institutions, reported a net loss of EUR 177,000 in 2024, an improvement from the EUR 419,000 loss recorded in 2023.
Its scale remains far smaller than that of its peers: EUR 8.3 million in customer loans, EUR 3.7 million in deposits, and staff costs of only EUR 211,000.
In practice, it operates more like a representative office than a fully-fledged offshore bank. Its primary mission is to serve as a bridge between the Tunisian community in France and Tunisia rather than engage in large-scale international financial intermediation.
The geopolitics of ownership
A rarely highlighted fact is that four of the six active offshore banks are backed by Gulf or Libyan capital.
The Libyan Foreign Bank of Tripoli owns 100% of ALUBAF and co-founded NAIB alongside the Tunisian state. Kuwait is represented through KIPCO and Burgan Bank in TIB, while Bahrain is present through ABC.
As a result, strategic decisions within Tunisia’s offshore banking sector are often influenced more by developments in Tripoli, Kuwait City, or Manama than by local market conditions.
NAIB, established in 1984 with capital of USD 30 million, focuses primarily on financing the foreign trade activities of exporting SMEs through a network of correspondent banks in major international financial centers. Its model resembles that of ALUBAF, although recent performance data are not publicly available.
LINC: The sector’s ghost
The Loan and Investment Company (LINC), officially licensed as Tunisia’s seventh offshore bank, is no longer operational.
Its continued appearance on official lists illustrates the difficulty of cleaning up the regulatory landscape and removing institutions that have effectively become empty shells. It occupies a banking license that could potentially be reassigned, yet the issue has not been publicly debated.
What 2025 changes structurally
The normalization witnessed in 2025 represents both a revelation and a recalibration. It clearly demonstrates that the purely rent-seeking model, collecting foreign currency, depositing it with the BCT, and living off interest income, is over.
Tunisia’s offshore banks will now have to perform genuine banking functions: financing foreign trade, supporting exporters, managing foreign-exchange flows, handling documentary operations, and developing treasury products for institutional clients.
This is precisely what ALUBAF has been doing for four decades, which explains its strong performance while some competitors struggled. TIB still possesses the resources needed to adapt. TF Bank’s Tunis branch will need to redefine its role in Tunisia.
And LINC stands as the most visible example of a model that ultimately failed to justify its existence.
The sector is entering a period of natural selection. Institutions with viable commercial business models will survive. Those without them will become increasingly marginal or disappear altogether.
