Arab Tunisian Bank – Ratings and Stable Outlook Affirmed
(MENAFN- Capital Intelligence Ltd) 23 October 2026
Capital Intelligence Ratings (CI Ratings or CI) today announced that it has affirmed the Long-Term Foreign Currency Rating (LT FCR) and Short-Term Foreign Currency Rating (ST FCR) of Arab Tunisian Bank (ATB or the Bank) at ‘C+’ and ‘C’, respectively. At the same time, CI Ratings has affirmed ATB’s Bank Standalone Rating (BSR) of ‘c’, Core Financial Strength (CFS) rating of ‘b’ and Extraordinary Support Level (ESL) of Moderate. The Outlook for the LT FCR and BSR remains Stable.
ATB’s LT FCR and BSR are constrained by CI’s internal assessment of sovereign credit risk for Tunisia. The Stable Outlook for the LT FCR is in line with CI’s internal assessment of sovereign risk for Tunisia, reflecting tentative signs of stabilising sovereign risk factors, albeit still at a high level. The outlook takes into consideration the narrowing current account deficit, supported by an increase in agricultural exports and tourism receipts. However, external refinancing risks remain high, aggravated by large external financing needs and limited financing options given the absence of direct access to capital markets. Political risk remains elevated and public finances weak. Downside risks for the banking sector remain high, and pressure on banks’ credit profiles is elevated due to financial stability risks and macroeconomic vulnerabilities.
ATB’s BSR of ‘c’ (CI does not append ‘+/-’ modifiers to BSRs in the ‘c’ category), reflects a CFS rating of ‘b’, an Operating Environment Risk Anchor (OPERA) of ‘c+’ (indicating significant risk), and CI’s assessment of the Bank’s capacity to withstand sovereign-linked economic and financial stress. In a sovereign event, the Bank’s liquidity, capital and asset quality would be negatively impacted, as would that of the banking sector.
Although the ESL is assessed as Moderate and is underpinned by the assumption of parent support from majority shareholder Arab Bank plc, this has not resulted in any rating uplift given the level of the BSR and our internal assessment of sovereign risk. ATB is a subsidiary of Arab Bank plc – a reasonably large financial institution in Jordan mainly operating across the MENA region. The Bank’s parent displays a satisfactory financial profile, and support for the smaller ATB would be expected.
The CFS is supported by the Bank’s majority ownership by Arab Bank plc and satisfactory liquidity profile including loan-based liquidity ratios, underpinned by a good customer deposit base. The CFS is constrained by a difficult operating and economic environment in Tunisia, a high NPL ratio, weakened loan-loss reserve coverage, low returns, a weak capital position in our view, and limited financial disclosure.
A stable customer deposit base is the main source of funding for ATB, representing around three-quarters of total assets, despite a mild contraction in 2025. Funding from the Central Bank of Tunisia (CBT) was nil at end-2025, as well as in H1 26. Funding diversification is aided by subordinated bonds issued in the local market, as well as other medium-term financing. ATB has a reasonably good franchise in Tunisia as the country’s eighth-largest bank by total assets. Its management and systems are supported by Arab Bank. Liquidity remained sound through H1 26, with broad liquid assets at a satisfactory level.
ATB’s stock of NPLs (including both loans in litigation and overdue loans) is large, with the Bank’s NPL ratio estimated by CI to have increased to 16.1% at end-2025, remaining well above that of leading private banks in Tunisia, and the sector overall. NPL coverage by provisions weakened at end-2025, and the capital buffer remains limited, although equity was supported by a capital injection by Arab Bank plc in November 2025. Credit risks will remain elevated due to the still challenging Tunisian economy.
Tunisian treasury bills and bonds increased to almost 11% of assets and are all denominated in Tunisian dinars. They are not considered highly liquid, as the secondary market in Tunisia has little activity. However, they can be repo-ed with the CBT and qualify as collateral for borrowing purposes. The share of government claims in total banking assets remained elevated as the banking sector increased its lending to the government and the sovereign-bank nexus rose in Tunisia. ATB’s government bond exposure represented 1.2x total equity at end-2025, highlighting concentration risk.
ATB’s capital ratios continue to be considered low, although the Bank’s capital base was strengthened in late 2025 through a TND77mn cash capital injection entirely subscribed by majority shareholder Arab Bank plc. However, the capital position continues to be eroded by shortfalls in loan-loss provisions against NPLs, with unprovided NPLs rising to 48% of total equity at end-2025, from 23% in 2024, despite the fresh capital injection. The overall capital position of the Bank currently provides only a limited capacity to absorb shocks.
Weak profitability is a principal credit challenge, and deteriorated in 2025 with the Bank recording a loss of TND24.4mn. Although total operating income was reasonably sound, pre-impairment operating profit fell sharply by 36%. Operating income was heavily eroded by high operating costs – the cost-to-income ratio jumped to 73% – and high total impairment on financial assets. Operating profit to average assets is very low, and the lowest in the peer group. It offers little loss-absorption capacity. ROAA turned negative to -0.09% in 2025.
ATB does not produce consolidated interim figures, as is the case for all Tunisian banks, and bank-only interim financial statements show that, while operating income for H1 26 was slightly higher, the Bank recorded a net loss of TND27.6mn (compared to a net profit of TND2.6mn in H1 25), heavily impacted by a more than doubling of provision charges as well as higher personnel expenses. The loss recorded in H1 26 may place further pressure on the Bank’s capital position. The banking sector still faces some regulatory headwinds. These regulations include interest rate reductions for certain existing customers, and the requirement to provide interest-free loans amounting to at least 8% of the previous year’s net profit to micro, small and medium-sized enterprises. Banks bear the credit risk associated with these loans, with no recourse to the CBT. Additionally, the income tax rate for banks remains elevated at 40% (up from 35%, effective January 2025). Improved GDP growth should support credit demand, albeit modestly.
Rating Outlook
The Outlook for LT FCR is Stable and is in line with CI’s internal assessment of sovereign credit risk for Tunisia.
Rating Dynamics: Upside Scenario
The ratings may be raised or the Outlook revised to Positive in the next 12 months, but this would require further improvement in the operating environment and would need to be preceded by a similar rating action on the sovereign, all other factors remaining unchanged.
Rating Dynamics: Downside Scenario
The Outlook could be revised to Negative or the ratings reduced by one notch in the next 12 months if the operating environment and/or economy deteriorate beyond our base line scenario, negatively impacting the ATB’s financial profile.
Contact
Primary Analyst: Evridiki Panayi, Credit Analyst; E-mail: ...
Secondary Analyst: Darren Stubing, Senior Credit Analyst
Committee Chairperson: Morris Helal, Senior Credit Analyst
About the ratings
The credit ratings have been issued by Capital Intelligence Ratings Ltd, P.O. Box 53585, Limassol 3303, Cyprus.
The following information source was used to prepare the credit ratings: public information. Financial data and metrics have been derived by CI from the rated entity’s financial statements for FY2021-25 and H1 26. CI may also have relied upon non-public financial information provided by the rated entity and may also have used financial information from credible, independent third-party data providers.
CI considers the quality of information available on the rated entity to be satisfactory for the purposes of assigning and maintaining credit ratings. CI does not audit or independently verify information received during the rating process.
The principal methodology used to determine the ratings is the Bank Rating Methodology, dated 3 April 2019. For the methodology and our definition of default see Information on rating scales and definitions and the time horizon of rating outlooks can be found at Historical performance data, including default rates, are available from a central repository established by ESMA (CEREP) at
This rating action follows a scheduled periodic (annual) review of the rated entity. Ratings on the entity were first released in January 1994. The ratings were last updated in October 2025. The ratings and rating outlook were disclosed to the rated entity prior to publication and were not amended following that disclosure.
The ratings have been initiated by CI. The following scheme is therefore applicable in accordance with EU regulatory guidelines.
Unsolicited Credit Rating
With Rated Entity or Related Third Party Participation:No
With Access to Internal Documents: No
With Access to Management: No
Conditions of Use and General Limitations
The information contained in this publication including opinions, views, data, material and ratings may not be copied, distributed, altered or otherwise reproduced, in whole or in part, in any form or manner by any person except with the prior written consent of Capital Intelligence Ratings Ltd (hereinafter “CI”). All information contained herein has been obtained from sources believed to be accurate and reliable. However, because of the possibility of human or mechanical error or other factors by third parties, CI or others, the information is provided “as is” and CI and any third-party providers make no representations, guarantees or warranties whether express or implied regarding the accuracy or completeness of this information.
Without prejudice to the generality of the foregoing, CI and any third-party providers accept no responsibility or liability for any losses, errors or omissions, however caused, or for the results obtained from the use of this information. CI and any third-party providers do not accept any responsibility or liability for any damages, costs, expenses, legal fees or losses or any indirect or consequential loss or damage including, without limitation, loss of business and loss of profits, as a direct or indirect consequence of or in connection with or resulting from any use of this information.
Credit ratings and credit-related analysis issued by CI are current opinions as of the date of publication and not statements of fact. CI’s credit ratings provide a relative ranking of credit risk. They do not indicate a specific probability of default over any given time period. The ratings do not address the risk of loss due to risks other than credit risk, including, but not limited to, market risk and liquidity risk. CI’s ratings are not a recommendation to purchase, sell, or hold any security and do not comment as to market price or suitability of any security for a particular investor. Further information on the attributes and limitations of ratings can be found in the applicable methodology or else at
The information contained in this publication does not constitute investment or financial advice. As the ratings and analysis are opinions of CI they should be relied upon to a limited degree and users of this information should conduct their own risk assessment and due diligence before making any investment or other business decisions.
Copyright © Capital Intelligence Ratings Ltd 2026
Capital Intelligence Ratings (CI Ratings or CI) today announced that it has affirmed the Long-Term Foreign Currency Rating (LT FCR) and Short-Term Foreign Currency Rating (ST FCR) of Arab Tunisian Bank (ATB or the Bank) at ‘C+’ and ‘C’, respectively. At the same time, CI Ratings has affirmed ATB’s Bank Standalone Rating (BSR) of ‘c’, Core Financial Strength (CFS) rating of ‘b’ and Extraordinary Support Level (ESL) of Moderate. The Outlook for the LT FCR and BSR remains Stable.
ATB’s LT FCR and BSR are constrained by CI’s internal assessment of sovereign credit risk for Tunisia. The Stable Outlook for the LT FCR is in line with CI’s internal assessment of sovereign risk for Tunisia, reflecting tentative signs of stabilising sovereign risk factors, albeit still at a high level. The outlook takes into consideration the narrowing current account deficit, supported by an increase in agricultural exports and tourism receipts. However, external refinancing risks remain high, aggravated by large external financing needs and limited financing options given the absence of direct access to capital markets. Political risk remains elevated and public finances weak. Downside risks for the banking sector remain high, and pressure on banks’ credit profiles is elevated due to financial stability risks and macroeconomic vulnerabilities.
ATB’s BSR of ‘c’ (CI does not append ‘+/-’ modifiers to BSRs in the ‘c’ category), reflects a CFS rating of ‘b’, an Operating Environment Risk Anchor (OPERA) of ‘c+’ (indicating significant risk), and CI’s assessment of the Bank’s capacity to withstand sovereign-linked economic and financial stress. In a sovereign event, the Bank’s liquidity, capital and asset quality would be negatively impacted, as would that of the banking sector.
Although the ESL is assessed as Moderate and is underpinned by the assumption of parent support from majority shareholder Arab Bank plc, this has not resulted in any rating uplift given the level of the BSR and our internal assessment of sovereign risk. ATB is a subsidiary of Arab Bank plc – a reasonably large financial institution in Jordan mainly operating across the MENA region. The Bank’s parent displays a satisfactory financial profile, and support for the smaller ATB would be expected.
The CFS is supported by the Bank’s majority ownership by Arab Bank plc and satisfactory liquidity profile including loan-based liquidity ratios, underpinned by a good customer deposit base. The CFS is constrained by a difficult operating and economic environment in Tunisia, a high NPL ratio, weakened loan-loss reserve coverage, low returns, a weak capital position in our view, and limited financial disclosure.
A stable customer deposit base is the main source of funding for ATB, representing around three-quarters of total assets, despite a mild contraction in 2025. Funding from the Central Bank of Tunisia (CBT) was nil at end-2025, as well as in H1 26. Funding diversification is aided by subordinated bonds issued in the local market, as well as other medium-term financing. ATB has a reasonably good franchise in Tunisia as the country’s eighth-largest bank by total assets. Its management and systems are supported by Arab Bank. Liquidity remained sound through H1 26, with broad liquid assets at a satisfactory level.
ATB’s stock of NPLs (including both loans in litigation and overdue loans) is large, with the Bank’s NPL ratio estimated by CI to have increased to 16.1% at end-2025, remaining well above that of leading private banks in Tunisia, and the sector overall. NPL coverage by provisions weakened at end-2025, and the capital buffer remains limited, although equity was supported by a capital injection by Arab Bank plc in November 2025. Credit risks will remain elevated due to the still challenging Tunisian economy.
Tunisian treasury bills and bonds increased to almost 11% of assets and are all denominated in Tunisian dinars. They are not considered highly liquid, as the secondary market in Tunisia has little activity. However, they can be repo-ed with the CBT and qualify as collateral for borrowing purposes. The share of government claims in total banking assets remained elevated as the banking sector increased its lending to the government and the sovereign-bank nexus rose in Tunisia. ATB’s government bond exposure represented 1.2x total equity at end-2025, highlighting concentration risk.
ATB’s capital ratios continue to be considered low, although the Bank’s capital base was strengthened in late 2025 through a TND77mn cash capital injection entirely subscribed by majority shareholder Arab Bank plc. However, the capital position continues to be eroded by shortfalls in loan-loss provisions against NPLs, with unprovided NPLs rising to 48% of total equity at end-2025, from 23% in 2024, despite the fresh capital injection. The overall capital position of the Bank currently provides only a limited capacity to absorb shocks.
Weak profitability is a principal credit challenge, and deteriorated in 2025 with the Bank recording a loss of TND24.4mn. Although total operating income was reasonably sound, pre-impairment operating profit fell sharply by 36%. Operating income was heavily eroded by high operating costs – the cost-to-income ratio jumped to 73% – and high total impairment on financial assets. Operating profit to average assets is very low, and the lowest in the peer group. It offers little loss-absorption capacity. ROAA turned negative to -0.09% in 2025.
ATB does not produce consolidated interim figures, as is the case for all Tunisian banks, and bank-only interim financial statements show that, while operating income for H1 26 was slightly higher, the Bank recorded a net loss of TND27.6mn (compared to a net profit of TND2.6mn in H1 25), heavily impacted by a more than doubling of provision charges as well as higher personnel expenses. The loss recorded in H1 26 may place further pressure on the Bank’s capital position. The banking sector still faces some regulatory headwinds. These regulations include interest rate reductions for certain existing customers, and the requirement to provide interest-free loans amounting to at least 8% of the previous year’s net profit to micro, small and medium-sized enterprises. Banks bear the credit risk associated with these loans, with no recourse to the CBT. Additionally, the income tax rate for banks remains elevated at 40% (up from 35%, effective January 2025). Improved GDP growth should support credit demand, albeit modestly.
Rating Outlook
The Outlook for LT FCR is Stable and is in line with CI’s internal assessment of sovereign credit risk for Tunisia.
Rating Dynamics: Upside Scenario
The ratings may be raised or the Outlook revised to Positive in the next 12 months, but this would require further improvement in the operating environment and would need to be preceded by a similar rating action on the sovereign, all other factors remaining unchanged.
Rating Dynamics: Downside Scenario
The Outlook could be revised to Negative or the ratings reduced by one notch in the next 12 months if the operating environment and/or economy deteriorate beyond our base line scenario, negatively impacting the ATB’s financial profile.
Contact
Primary Analyst: Evridiki Panayi, Credit Analyst; E-mail: ...
Secondary Analyst: Darren Stubing, Senior Credit Analyst
Committee Chairperson: Morris Helal, Senior Credit Analyst
About the ratings
The credit ratings have been issued by Capital Intelligence Ratings Ltd, P.O. Box 53585, Limassol 3303, Cyprus.
The following information source was used to prepare the credit ratings: public information. Financial data and metrics have been derived by CI from the rated entity’s financial statements for FY2021-25 and H1 26. CI may also have relied upon non-public financial information provided by the rated entity and may also have used financial information from credible, independent third-party data providers.
CI considers the quality of information available on the rated entity to be satisfactory for the purposes of assigning and maintaining credit ratings. CI does not audit or independently verify information received during the rating process.
The principal methodology used to determine the ratings is the Bank Rating Methodology, dated 3 April 2019. For the methodology and our definition of default see Information on rating scales and definitions and the time horizon of rating outlooks can be found at Historical performance data, including default rates, are available from a central repository established by ESMA (CEREP) at
This rating action follows a scheduled periodic (annual) review of the rated entity. Ratings on the entity were first released in January 1994. The ratings were last updated in October 2025. The ratings and rating outlook were disclosed to the rated entity prior to publication and were not amended following that disclosure.
The ratings have been initiated by CI. The following scheme is therefore applicable in accordance with EU regulatory guidelines.
Unsolicited Credit Rating
With Rated Entity or Related Third Party Participation:No
With Access to Internal Documents: No
With Access to Management: No
Conditions of Use and General Limitations
The information contained in this publication including opinions, views, data, material and ratings may not be copied, distributed, altered or otherwise reproduced, in whole or in part, in any form or manner by any person except with the prior written consent of Capital Intelligence Ratings Ltd (hereinafter “CI”). All information contained herein has been obtained from sources believed to be accurate and reliable. However, because of the possibility of human or mechanical error or other factors by third parties, CI or others, the information is provided “as is” and CI and any third-party providers make no representations, guarantees or warranties whether express or implied regarding the accuracy or completeness of this information.
Without prejudice to the generality of the foregoing, CI and any third-party providers accept no responsibility or liability for any losses, errors or omissions, however caused, or for the results obtained from the use of this information. CI and any third-party providers do not accept any responsibility or liability for any damages, costs, expenses, legal fees or losses or any indirect or consequential loss or damage including, without limitation, loss of business and loss of profits, as a direct or indirect consequence of or in connection with or resulting from any use of this information.
Credit ratings and credit-related analysis issued by CI are current opinions as of the date of publication and not statements of fact. CI’s credit ratings provide a relative ranking of credit risk. They do not indicate a specific probability of default over any given time period. The ratings do not address the risk of loss due to risks other than credit risk, including, but not limited to, market risk and liquidity risk. CI’s ratings are not a recommendation to purchase, sell, or hold any security and do not comment as to market price or suitability of any security for a particular investor. Further information on the attributes and limitations of ratings can be found in the applicable methodology or else at
The information contained in this publication does not constitute investment or financial advice. As the ratings and analysis are opinions of CI they should be relied upon to a limited degree and users of this information should conduct their own risk assessment and due diligence before making any investment or other business decisions.
Copyright © Capital Intelligence Ratings Ltd 2026
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