State of the Bond Market: Institutional Investors Drive Growth
For several years, economists have been criticizing the state for causing a crowding-out effect by absorbing a large portion of liquidity. However, this has led to the development of the secondary debt market.
Since the beginning of the year, the volume of transactions on the bond market has reached 264,530 MTND, a 353.5% increase compared to the same period in 2024.
This market is purely institutional, which explains the significant average size of operations, at 0,711 MTND. Treasury bonds accounted for 86.2% of transactions (228,155 MTND), while corporate bonds represented 13.8% (36,375 MTND).
Purchases were mainly made by OPCVM (Open-Ended Investment Companies), accounting for 99.1% of transactions. However, on the selling side, their share drops to 29.0%. Proprietary accounts were the largest sellers, with 145,880 MTND. Tunisian investors, operating in a free management mode, massively liquidated their positions, representing 15.6% of the total volume. This shows how some investors took advantage of the high-interest rate period to invest in debt and are now exiting the market to return to the stock market or safer banking investments.
This market needs to be further developed, regardless of the interest rate context. There are attractive tax benefits, including the deduction of interest received on bond loans and BTAs (Bank Treasury Accounts) up to 10,000 TND of taxable income. It is also essential to consider opening this market to foreign investors who may be interested in such investments. While it is true that this would involve "hot money" that quickly leaves the country in the event of an external shock, it can help accumulate foreign exchange resources, a key factor in maintaining national economic stability.
