Establishment of an Asset Management Company in Tunisia

Project Development Objective (PDO)

This technical assistance project aims to enable the government of Tunisia to establish an asset management company (AMC) to solve the long-standing issue of nonperforming loans (NPLs) in the tourism sector and improve banking sector soundness.


Tunisia is clearly viable and attractive as a tourist destination. The tourism sector now plays a key role in the socioeconomic development of Tunisia and contributes 7 percent of the GDP. Activity in the tourism sector plunged in 2011, and partially recovered in 2012, because of insecurity during and after the national revolution. 

A set of structural and governance issues magnified the problematic situation in the tourism sector. These issues are related to (a) an ineffective insolvency and creditor rights system, (b) an overreliance on debt, (c) the role of the state-owned banks, and (d) a lax central bank regulation. Although the problem existed before the revolution, one must note that NPLs in the tourism sector grew at an accelerated pace between June 2011 and June 2012. The project will address these issues in the context of a response by the financial sector authorities to such NPLs.


The project team, assisted by the World Bank and with the participation of the staff of the Central Bank of Tunisia and Ministry of Finance, is drafting a law for the establishment of the AMC and a business plan for it. 

The AMC law is needed to establish an ad hoc vehicle with super powers aimed at accelerating debt resolution. This component covers all legal-related activities, including drafting (a) the AMC by-laws; (b) ministerial decrees aimed at the implementation of the AMC law; and (c) key AMC procedures such as the precise definition of eligible assets and assets valuation, appointment of temporary administrators for hotel units, and workout mechanisms. The business plan for the future AMC allows the Tunisian authorities to assess the initial capital needed by the AMC to operate.

Expected Outcomes

The proposed technical assistance project aims to enable the Tunisian authorities to establish an AMC to solve the long-standing debt issues of the tourism sector while improving banking sector soundness and increasing access to finance. The main outcomes of the project are as follows: 

1.  Short-term outcomes 
      •  Adopting a law establishing the AMC, which will help overcome the current bankruptcy regime’s
         obstacles and may also help accelerate the debt resolution process 
      •  Establishing an AMC, whereby its legal form, governance, and management arrangements will
         be key success factors and it will buy the bad assets through a swap with guaranteed bonds 

2.  Medium- to long-term outcomes
      •  Increasing banking sector stability and soundness, whereby a significant share of the tourism
         sector NPLs in the banking sector will be transferred to an AMC and swapped against state-
         guaranteed AMC bonds 
      •  Improving banking sector intermediation, so that the liquidity will free up space for investments
         and small- and medium- enterprise finance in high-potential productive sectors