UIB's Strategic Review Process Comes to an End
The UIB's board of administration, held on February 7, 2025, made a major announcement: Société Générale, the bank's reference shareholder with 52.34% of the capital, has decided to put an end to the strategic review process initiated in June 2023. From now on, it will focus on strengthening UIB's positioning, transforming, and growing to serve the Tunisian economy, with the support of its co-shareholders.
It was specified during the board meeting that Société Générale will remain attentive to market developments and listen to any opportunity that aligns with its strategic objectives and the interest of UIB and its various stakeholders.
In other words, Société Générale has not received an offer that it deems interesting and in the best interest of its Tunisian subsidiary. In our opinion, this is not due to the bank's intrinsic value, but rather the result of uncertainty surrounding the Tunisian banking sector in recent times. Credit institutions are under significant fiscal pressure, and while high interest rates have boosted revenues, the growth rate of non-performing loans has also accelerated. The regulatory changes to checks and the issue of reducing interest rates on outstanding loans have also raised doubts about the future profitability of banks. Even investors fear that interest rates may drop, and constraining taxation remains, which would reduce the ability to generate profits.
Historically, Tunisian banks have always managed to adapt quickly to operational and regulatory challenges. For 2024, operating results will undoubtedly hold up. They will need to demonstrate the solidity of their models in 2025 and 2026. UIB has the advantage of having Société Générale at its disposal, enabling it to respond to all challenges through innovation on the one hand, and by respecting the most demanding standards on the other. In the market, we believe that the information will not come as a surprise, and the end of the process is reflected in the stock price.
