His excellency ZINE EL ABIDINE BEN ALI President of … · Head office : 21, avenue Kheireddine Pacha 1002 - Tunis Belvédère Tél. : 71 110 000 / Fax : 71 784 417 Voice server :

«Oneofourmostimportantchoicesistoimprovethecitizen’slivingstandards,preservethehighpercentagerepresentedbythemiddle-classcategoriesinoursocietyandreinforcethecondi-tionsensuringthesocialpromotionforallthecitizens.

Thisisindeedwhatwewillstrivetoreinforcesothatlife-qualityindicatorsinTunisiawouldreachthelevelofthedevelopedcountries.Inthisregard,wewillcreatenewmeansoffinancingsothataverage-incomecitizenscouldaffordahouse.

Toconsolidatethesemechanisms,wehaveincludedinourprogramtheenlargementoftherangeofbeneficiarieshavingaccestothesocialhousefinancingandtothosewhosemonthlywa-gesdonotexceedonethousanddinars.»

His excellency ZINE EL ABIDINE BEN ALIPresident of the Republic of Tunisia

ExtractfromthespeechofPresidentZineElAbidineBenAli

attheopeningoftheelectoralcampaignOctober10th,2004

Head office : 21, avenue Kheireddine Pacha1002 - Tunis BelvédèreTél. : 71 110 000 / Fax : 71 784 417Voice server : 88 40 14 21e-mail:[email protected] site : www.bh.com.tnCall center : 1800

ANNUAL REPORT 2006

Contents

8 Statement of the Chairman and Managing Director

11 The international situation

17 The national situation

23 The bank’s activities

24 Evolution of the main indicators of BH 2001 - 2006

25 At the level of activity

30 At the level of operating activities

35 Report on the actions undertaken during year 2006

41 The bank’s perspectives in year 2007

45 Financial Status

55 The bank’s subsidiaries

61 Management Report of the Group Banque de l’Habitat

67 Consolidated Financial Status

75 Draft Resolutions

� ANNUAL REPORT 200�

Mr Abou Hafs Amor NAJAIChairman & president

of the board

Ms Fawzia MOUSSA SAYIDBoard member representing

the government

Mr Jalel CHOUIHI Board member representing

the government

Mr Etajouri FATNASSI Board member representing

the government

Mr Med ridha TRABELSI Board member representing

the government

Ms Souhir TAKTAK Board member representing

the government

BOARD OF DIRECTORS

Public sector

�ANNUAL REPORT 200�

Mr Néjib BEN LAAROUSSI MARZOUGUI

Mr Adel ZARROUK Mr Mohamed Sadok DRISS

Mr Sami ELLOUZESociété BONNA

Mr Ahmed TRABELSI

Mr Chiheb GHANMIGenerale Audit Conseil

Auditor

Mr Montacer Mahmoud MANSOURState auditor

Mr Ali Dhrif BOUZIDIVice-president in charge of

the general resources

Mr Mahmoud Ben FAREHVice-president in charge of

production and development

Private sector

� ANNUAL REPORT 200�

Dear Shareholders,

On behalf of the Board of Directors, I’m pleased to announce to you the performances achieved by your Bank during the year 200�.Year 200� has been declared as the year of the achievements’s consolidation which are registered in the framework of the Bank’s policy and strategy related to the period 2004 - 200�. Today, con-sidering the achieved results, one has to confirm that year 200� has been worth to the anticipated ambitions and expectations.

As a matter of fact, concerning the collection of the customer’s deposits, the Bank ended the year 200� with a volume of 2329,1 million dinars, registering an exceptionel growth of 30�,1 million dinars exceeding for the first time the productive credits evolution. This growth has affected all the customer’s deposits and has been characterized by the launch of the house-saving product which broke with the downward tendency that has been fol-lowed during the previous years. As of the credits to customers, the achieved results permitted to boost the global volume to 2�5�,3 million dinars by end of December 200� against 25�3,5 million dinars by end of year 2005. This progress is resulted from the diversification of the credit portfolio which is characterized by a surge in the commercial credits and the retail lendings as well as by a strong revival of the pre-financed lending , thus , the bank achieved a positive evolution of 1�,5 million dinars.

Concerning the consolidation of the core ativity of the Bank : the credit to real-estate acqui-sitions have progressed of 24,9% million dinars impulsed mainly by the revival of direct lendings.The development of the bank’s activity was also accompanied by an improvement in the assets quality. As a matter of fact, the volume of Non Performing Loans continued its downward trend registering a decrease of 24,9% million dinars.

Consequently, the bank’s ratio of NPLs to total loans to customers has been set at �,�5% by the end of 200� against 9,�% and 13,4% respectively by the term of year 2005 and 2004. In addition, the cover of these debts by the provisions and by the reserved bank charges has clearly improved registering �1,1�% exceeding the anticipated objective for the year 200� (�0%) and

Statement of the Chairman

and Managing Director

9ANNUAL REPORT 200�

The President of the Board of DirectoryAbou Hafs Amor NAJAI

drawing the bank nearer to the international standards in terms of NPL cover by the provisions.

The BNP has been set at 145,3 million dinars as of 31/12/200� against 123, 3 million dinars the previous year registering a growth of 1�,�% thanks to the improvement of the interest margin as well as to the increase of the profits and gains made on the portfolio securities. The level of BNP allowed our bank to continue in the consolidation of its provisions registering a net result of 2�,5 million dinars and to be in the second position in the sector .The gross operating result has been set at 93,2 million dinars as of 31/12/200� against �1,9 million dinars in year 2005 and �3 million dinars initially anticipated, thus placing the bank in the second posi-tion in the sector. This performance has been drawn on one hand, from the clear improvement of the net banking product and on the other hand, from the regular control of the operating charges which registered a decrease of 0,4 million dinars compared to year 2005.

All these performances are resulted from the development program and the restructuring plan pursued by the bank and from the projects that have already started in 2005 as well as the launch of new projects related to the commercial development and the reinforcement of the sales communica-tion channels and also the softness of the bank’s procedures.

As of the BH’s group, the different bank’s subsidiaries have generally registered satistactory results permitting the achievement of a net profit for the group up to 32,�% reaching 2�,4 MD by the end of year 200� against 21,4MD on 31/12/2005.Regarding the perspectives, the bank intends to continue its development process in the course of the year 200�, by consolidating its net worths and mobilization of long-term resources, consolidating its deposits, controlling its risks, improving productivity and reinforcing its profits.

Finally, I seize on this opportunity to express my sincere thanks to our shareholders for their sustained efforts, to our board members for their precious support and to the bank’s staff fot their seriousness and devotion.

THE INTERNATIONALSITUATION

12 ANNUAL REPORT 200�

For the fourth consecutive year, the world econo-my has registered in 200� the most considerable growth since the �0’s. In fact, the PIB has pro-gressd of 5,1% in 200� against 4,9% in 2004 in spite of the price explosion in raw products espe-cially in fuel which reached �0 dollars during the month of August 200� , but also the tightening in the monetary policies facing the appearance of inflationist tensions and the strong vulnerability of the exchange markets and the international stock exchanges.

Despite the price explosion in raw products, mainly fuel and the tightening of the

monetary policies as well as the vulnerability of the exchange markets and the international

stock exchanges, the world economy has registered a growth of 5,1%.

19901992 1994 1996 1998 2000 2002 2004 2006

USAJAPAN Euro Zone

7

-4-3-2-10123456

GDP Growth in %

THE INTERNATIONAL SITUATION

The growth of the world economic activity has been mostly drawn from the emerging countries (�,3% on average) than the developed countries in which the economic growth has only reached 3,1% in 200� against 2,�% the previous year and this was due to the healthy economic activity in the United States and Japan essentially its con-firmed consolidation in the Euro zone.

In 200�, the American economy began its down-ward trend cycle of the rapid growth that has been started 3 years ago .

The annual evolution of PIB has decreased to 5,�% during the first quarter, to 2,5% in the second quarter and to 2,2% in the third quar-ter. Over-viewing the year 200�, the American economic growth should be set at 3,4% against 3,2% the previous year. The slow-down of the ac-tivity should be continued in 200� with a growth of PIB of 2,5%.

The weakness in the economic environment is ex-plained by the bursting of the real-estate bubble which has strongly sustained consumption since 2001, then by the rapid growth of the interest rates between June 2004 and August 200� and by the historic level of debts among the house-holds and finally by the reduction in the purchase power resulting from the increase of the energy prices .

In the Euro zone, there was a clear strengthen-ing of the economic activity during the year which was related to the interior demand recovery. Thus, the rate increase in the zone has reached 2,�% in 200� against 1,4% in 2005. This recovery has shown clearly in Germany, the first economy in the zone, in which the real PIB reached 2,5% in 200� against 0,9% in 2005.

The sales to the foreign countries benefited from the strong dollar (around 11� Yens) and the ex-pensive Euro (around 152 Yens). The good health of the exports compensate partially the weakness of the interior demand which decreased to 0,�% during the 3rd quarter.


Five years after the introduction of China in the OMC, the indicators evaluating its integration in the world economy have largely exceeded the most optimistic previsions ; China should

exceed the USA as the second world exporter.

Inflation Evolution

0,6

-0,5

2,1

2,7

-0,5

2,2

3,4

2,2

3,2200420052006

Japan Euro Zone USA

In China, the economic growth reached 10,5% in 200� against 10% in 2005. Five years after the introduction of China in the OMC, the indicators evaluating its integration in the world economy have largely exceeded the most optimistic previ-sions. The Chinese commercial surplus should be set between 120,3 and 135,3 thousand million Euros in 200�; China should exceed the USA as the second world exporter, with almost �22,1 of Euros in products. This evolution concerns also the quality aspect since China is the first world exporter in the Information Technology field for 2 consecutive years.

Regarding Employment, the situation registered in 200� a general improvement in the developed countries with an unemployment rate decreasing from 5,1% to 4,�% in USA, from �,�% to �,�% in the Euro zone and from 4,4% to 4,1% in Japan.

Year 200� has been the 5th consecutive year characterized by the upward tendency in terms of raw materials, particularly for the industrial prod-ucts and nonferrous metals which registered a growth between 25% and 1�3%. This evolution is explained by the Chinese phenomenal growth (more than 10% a year) and Indian (more than �%) requiring proportioned imports. Concerning Fuel, the brent’s baril price has reached �0 dollars during the month of August, then it was reduced to �0 dollars by the month of September. This fall back is essentilly explained by the slowing down of the world demand due to the rise in the activity’s rythm, particularly in USA and CHINA, which are big energy consumers, and also by the increase of the storage. On October 20, 200�, in order to avoid the fall in prices, the OPEP took the decision to reduce

its production to 1,22 million barils a day starting from November 1st to be fixed at 2�,3 million barils. The energy price reduction combined to the mon-etary policies tightening has reduced the inflation level, particularly in the industrialized countries. thus, the rise of the consumption prices in terms of annual swing has reached 3,2% in USA, 2,2% in the Euro Zone and 0,�% in Japan.

As of the interest rates, particularly the short-term ones, the central banks have continued their poli-cies of restricting their lending conditions. The ba-sic interest rates have been increased in USA, in the Euro Zone and for the fist time since 2001 in Japan.

In the Euro Zone, the European Central Bank (BCE) continued its upward rate cycle that has been started on December 2005 and raised for the 5th time its basic rate, the repo by a quarter of point. In the course of the year, the ECB rate reached 3,50% against 2,25% justified by the in-flationist risks within an environment of continu-ous economic growth.In USA, during the first semester, the American Federal Reserve (FED) has increased 4 times the interest rates by a quarter of point to reach 5,25% in June 200�.


During the first semester, the American Federal Reserve (FED) has increased 4 times the interest

rates by a quarter of point to reach 5,25% in June 200�.

the Euro was considerably appreciated against the dollar reaching its historic levels of 2004

(then, it was fixed at 1,3554 dollars)

In Japan the monetary authorities modified their policies for 2 times, on March 9, they put an end to their over-flexible monetary policy by drawing the liquidities from the monetary process which maintained the rates near zero. On July 14, the Japanese Central Bank increased its basic rate to 0, 25%.

As of the exchange markets, they were vey ac-tive in 200�, particularly the Euro which was con-siderably appreciated against the dollar reaching its historic levels of 2004 (then, it was fixed at 1,3554 dollars). In 200�, the unique currency has been exchanged at its highest level 1,3343 dol-lars on December 4 and has registered an annual increase of 11,39% to be finally fixed at 1,3199 dollars.

Facing the Yen, the Euro has also registered a record level reaching 15�,13 Yens on December 29. In one year, the Euro gained 12,�5% against the Yen.By year’s end, the Euro strength facing the com-panies competition has worried the french author-ities. As a matter of fact, the ministry of economy and finance judged by end of November that the exchange market situation needed a «large com-mon interest».

The GBP was highly appreciated against the dol-lar (+13,�9%). Being affected by the fall of the dollar, the GBP has approached the levels which prevailed in September 1992 when the GBP un-tied from the European Monetary System (SME).


Year 200� witnessed the euphoria of the world stock exchanges except the Jananese NIK-

KEI, as a matter of fact, the CAC 40 registered an annual profit of 1�,53%. The DOW JONES

index reached a historic record level of 1�,29%

The British currency has benefitted from the rise of the British Bank interest rates (from 4,5% to 5%) as well as from the diversification of the In-ternational central Bank reserves which used this currency with high remuneration against the dol-lar.

Year 200� witnessed the euphoria of the world stock exchanges except the Jananese NIKKEI which suffered from the strong Yen and the Mid-dle East markets victimized by the bursting of the speculative bubble which started by mid - 2005. Most of the stock exchanges indexes have pro-gressed of 10%.

For the 4th consecutive time, the Paris stock exchange made a progress. Its basic index the CAC40 has been fixed on Friday, December 29 at 5 541,�� points registering an annual profit of 1�,53%, though it remained under the historic peak of September 2000, just before the burst-ing of the internet bubble. The indexe big com-panies, largely implemented abroad, have prof-

The rise of the European Central Banks rates have not been considered penalizing for the french ac-tions. In addition, the merge-acquisitions have contributed to dynamize Paris stock exchanges: ALCATEL and THE American LUCENT related to telecommunication, ARCELOR and MITTAL related to steel industry, EURONEXT and the Netherland’s company operating at Paris stock exchange with New York Stock exchange.

ited from the considerable world growth and from the improvement of the economic environment in France.

THE NATIONALSITUATION

1� ANNUAL REPORT 200�

THE NATIONAL SITUATION

During year 200�, the Tunisian economy has continued its progress in most of the sectors of activities in spite of the international fluctuations of that period, particularly the price explosion of energy and raw materials.

The economic growth rate of the year 200� has been raised to 5,3% against 4,2% in 2005 es-sentially thanks to a good agricultural year, a re-vival of the manufactured industries sectors and the pursuit of improving the activities of good and services such as Tourism, Air transportation and Communication.

The economic growth rate of the year 200� has been raised to 5,3% against 4,2% in 2005 in spite of the fluctuations registered by the international situation of that period,

particularly the price explosion of energy and raw materials.

The agricultural and fishing sector has regis-tered good results during the season. These improvements derive essentially from the olive oil production, cereals, citrus fruits, vegetables and fruits.

Concerning arbori-culture, the olive oil exports have raised to 1�� thousand tons in the course of year 200� for a value of �29 MD, that is a growth of 53,3% in quantity and �3,9% in qual-ity compared to year 2005.

In the livestock farming, the fresh milk produc-tion increased of �%, that is 9�1 million litre which has favorably affected the level of the col-lected volume reaching 4�0 million litre against 432 million in 2005.

Regarding the fishery sector and aqua-culture, the production has stagnated at a level of 100 thousand tons during the 11 first months of 200� compared to the same period of the pre-vious year. All the various modes of fishing have been more or less reduced, except the blue fish production (9%) and lagoon fishing (3%).

During the year, the food balance with foreign countries has registered a surplus of 259,2 MD against 132,3 MD the previous year. Thus, the cover rate of imports by exports reached 119,�% against 112,1% in 2005.

The industrial activity witnessed a revival in 200� compared to the previous year. As a matter of fact, the general index of the in-dustrial production has registered a growth of 3,4% during the 11 first months of 200� against 0,�% during the same period of the previous year.

This revival is due to the increase of the man-ufactured industrial production (5,5% against 0,3% in 200�), to the food processing (5,2% against -1,�%) and to the deceleration of the declining rythm of textile industries , clothing , leather and shoes (-1,2% against 5,5%).

On the other hand, the energy production has registered a decline of 2,�% by end Novem-ber 200� against a growth of 2,3% during the same period of the year 2005.

The mining sector’s production has continued its downward tendency for the second con-secutive year with an accelerated rythm that is -10,3% against -1,3%. This was due to the decrease of other mining products such as zinc and lead due to the reserve exhaustion. As of exports, the sales of manufactured in-dustries, other than food processing, have in-


The national program of Energy control permitted the achievement of energy saving of almost

2�0 thousand tons as equivalent in oil and a profit of �� MD previsioned as compensation charges

for the year 200�.

Evolution of the growth rate and the inflation rate

7 6,2%

5%

2,7% 2,9% 1,9%2,8%

2,6%3,6% 2%

4,5%

5,2%

1,9%

5,6% 5,8%4,2%

5,3%

123456

1999 2000 2001 2002 2003 2004 2005 2006

growthInflation rate

creased of 10,2% in 200�.

The exports of food processing have been also consolidated due to the net improvement of the olive oil sales (�29 MD against 4�� MD). Concerning the industrial sector’s promotion, 3 ��1 companies have adhered to the level-ling program, 2 434 of which have already acquired the approvals of their plan to the levelling program for an investment envelope evaluated at 3 �95 MD.

It is worth noting that the national program of Energy control permitted the achievement of energy saving of almost 2�0 thousand tons as equivalent in oil and a profit of �� MD previ-sioned as compensation charges for the year 200� in order to compensate for the increase of the energy invoices.

In 200�, the touristic sector has registered positive results in all parameters despite a certain deceleration in 2005.As a matter of fact, the tourist entries have increased of 2,�% during year 200� reaching �,5 million tourists. This rise came essentially from the Maghreb entries (3,�%).In addition, the tourism-nights have increased in year 200� of 1,4% against 2,4% the previ-ous year. As the occupation rate, it stabilized at 51,5%.Finally the touristic gains have increased of �,3% against 13% at the end of 2005 to be fixed at 2 �51 MD.

Simultaneously to the deceleration of the for-eign tourist number, the Air transport of pas-

sengers has made a lesser progress in 200� than the previous year. The rise of the pas-senger’s number did not exceed 1,�% by end November against 9,1% during the same pe-riod of 2005.

Foreign trade has registered a sustained progress. The rythm acceleration of some traditional export sectors permitted a deficit limitation of the Energy balance. The foreign trade has witnessed a growth of 12,�% during the year 200� in terms of exports and 15,�% in terms of imports.

Thus, the commercial deficit has deepened, it reached 95�,� MD compared to a fall of 412 MD registered the previous year ; the cover rate was reduced to ��,5% against �9,�% the previous year being affected by the net increase of the Energy imports.

On December 2�, 200�, the foreign curren-cies reserves have been raised to � �53 MD or the equivalent of 15� days of importations.

Regarding inflation, the general price indexe related to consumption has registered a de-celeration during the last months of the previ-ous year to reach 4,5% in 200� against 2% the year before.


the general price indexe related to consump-tion has registered a deceleration during the last

months of the previous year to reach 4,5% in 200� against 2% the year before.

Evolution of the stock exchange indexes

1999 2000 2001 2002 2003 2004 2005 2006600800

100012001400160018002000220024002600

BVMT Index TUNINDEX Index

1142

1599

2331

1425

975940996 783

161513311250

11191 267

1443

This tendency is explained notably by a rise in the transportation products (�,4% against 4,�% in 2005) and by a rise in the food prices (5,4% against 0,1% in 2005) due to the increase of the oil prices (21,�% against 1�,2%).

On the monetary level, year 200� has been char-acterized by the following :- An improvement of the banks’ treasury during the last quarter of 200�- An increase of the monetary mass of 11,2% against 11% the previous year and an up-to –date prevision of 11% for the whole year 200�. - A consolidation of the net foreign debts of 2 �� MD against 9�� MD in 2005, this was due to the improvement in the net assets in foreign curren-cies (+2 �33 MD against 1 139 MD in 2005)also due to the collection of the privatization revenues of about 35% of Tunisie Telecom’s capital in July 200� amounting to 2 250 MD.A rise in the government’s net debts of 951 MD by end 200� against 341 MD the previous year. This evolution is explained by the fallback position of the treasury current account (-244 MD) added to the rise in the outstanding treasury bills of the bank’s portfolio (+ 3�� MD)

An improvement of the contribution to economy of 1 ��5 MD (+�,�%) against a rise of 1 455 MD (+�,3%) in 2005. This evolution is attributable both to the ordinary resources growth (�,�%) as to the securities portfolio (�,�%) ; at the same time, the credits on the special resources have reduced of

2,�% against �,�% the previous year.It is the sector of services which monopolized the biggest part of the envelope, that is 152� MD. In this context, in reaction to the rise of inflation aroused by the increase in the world rates of hydro-carbon and the prices of basic products, the Tunisian Central Bank has intervened to raise its basic rate of 25 points to reach 5,25% which reflected on the monetary market’s rate (TMM) and consequently on the saving’s remuneration’s rate.

Concerning the exchange market, the dinar has registered in 200� both a depreciation of 5,�% compared to the Euro and an appreciation of 4,�% compared to the American dollar.

The financial market continues its performance registering by end 200� historic levels, as a mat-ter of fact, the stock exchange markets have achieved important growth, such as The Tunindex reference indexe has ended year 200� with 2 331,05 points (+44,3% compared to 2005 ), this performance is two times bigger than the previous year( +21,3% ).


The financial market continues its performance registering by end 200� historic levels .

The Tunindex reference indexe has ended year 200� with 2 331,05 points (+44,3% compared to 2005), this performance is two times bigger than

the previous year (+21,3%).

Evolution of the stock exchange capitalization

3 840

5 491

3 8893 275

2 834 2 976 3 085

2000 2001 2002 2003 2004 2005 2006

The volume of treated securities have increased of 5� million securities against 41 million securi-ties, that is a growth of 3�,�% compared to year 2005.

As of the stock exchange capitalization, it in-creased of 43% to be set at 435 491 MD against 3 �40 MD on December 31, 2005.

Concerning the performance of the quoted val-ues, the market has registered a net upward ten-dency thanks to a strong revival of some values which contributed to pull the market upward .

As year 2005, the exchange of capitals concerned a limited number of values, � of which have mo-nopolized more than the half of the global volume of transactions, such as the securities of BIAT, TUNISAIR, SOTRAPIL, SFBT, BT, STB and BH. The global volume of the exchanged capitals has registered a rise of �,4% in year 200� reaching �4� MD against �01 MD the previous year.

The events that have affected the stock exchange year are the following :

- The Split operation which supported the vol-ume on the market and concerned � quoted val-ues. This operation divided the share’s par value without modifying the social capital, and did not affect in any way, the patrimonial wealth of the shareholder.

- The foreign flow operations concerned particularly the values of air companies such as KARTHAGO AIRLINES and TUNISAIR as well as the securities of BH, SOTRAPIL and SPDIT.

- The enrichment of the stock exchange quotation by 3 new listings namely La Société Immobilière Tuniso-Saoudienne (SITS), the Leasing Company EL WIFAK and the company ESSOUKNA ; which brought the number of the quoted companies to 4� unities by end 200�.

- The transfer of 35% of the National’s Company of Telecommunication’s capital «TUNISIE TELECOM» detained by the government to the Emirati Con-sortium «TECOM-DIG» for a total envelope of 2.250 MD.

THE BANK’S ACTIVITIES


THE BANK’S ACTIVITIES

2006 2005 2004 2003 2002

2006 2005 2004 2003 2002

2006 2005 2004 2003 2002

2006 2005 2004 2003 2002

Evolution of the main indicators of BH 2001 - 2006

Total balanceCustomers resourcesNet worthsLoans to customers

Activity

3 �25,42 329,1

24�,42 �5�,3

3 2��,32 02322�,�

2 5�3,�

3 045,�1 �5�,�

203,42 34�,�

2 ��2,41 ��0,2

191,92 215,2

2 ��4,�1 5�2,5

192,52 134,5

Net banking productGeneral feesGross operating productNet capital endowment on provisionsNet profit

Operating activities

145,3�2,�93,243,42�,5

123,3�0,5

�243,121,�

104,95�,955,229,21�,5

��,452,�39,313,�1�,4

93,�50,94�,31�,2

1�

Net profit/net worths(ROE) Net profit/total asset (ROA)Operating ratioSolvency ratioLiquidity ratio

Ratios

11,4� %0,�� %

43,1� %�,1� %

123,13 %

9,5� %0,�� %

49,0� %�,�3 %

114,39 %

9,11 %0,�1 %

54,29 %9,0� %

11�,29 %

�,5� %0,5� %

�0,9� %9,5� %

13�,�� %

�,�5 %0,�3 %

54,3� %10,�� %

125,�1 %

Number of employeesNumber of branchesNumber of automatic teller machinesNumber of electronic cardsNumber of accounts

Other indicators

1 901�0��

153 921�09 �20

1 920�9�3

154 ��55�� 990

1 931�5�3

15� 12�533 �9�

1 941�3�0

1�1 5�04��

1 952�950

101 9�5491 45�

quantity %

State of tunisia & public companiesPrivate individualsForeignersOthersTotal

Capital structure

� �41 3214 223 �192 019 225

15 �3515 000 000

43 �0� �0521 11� 59510 09� 125

�� 5�5 000 000

5�,2� %2�,1� %13,4� %0,10 %100 %

amount (TND)

30/08/06 Standard & poor’s(LT)Standard & poor’s(CT)Future prospects

Rating

BB+B

Stable


During year 200�, the bank has pursued its devel-opment program of restructuration and standard-ization in all aspects of the activities and banking operations, this was due to the implementation of projects started in 2005 which are relaled to com-mercial development, consolidation of the bank’s network, enrichment of the communication chan-nels and softness of procedures

In year 200�, the bank’s results were in confor-mity with its anticipations or even exceeding the fixed objectives. As a matter of fact, for Banque de l’Habitat, year 200� has been characterized by the following important facts :

At the level of activity

An important consolidation of the Bank’s resourc-es due to a good performance in terms of cus-tomer’s resources

By the end of 200�, the Bank’s resources have in-creased of 3 �30,� MD against 3 204,� MD, that is a rise of 42� MD representing almost twice the rise registered the previous year (+215,� MD) and mainly resulting from the rise of the customer’s resources.

Monthly evolution of the customer’s resources12 - 05 / 12 - 0�

Dec 05 Feb 06 April 06 June06 Aug06 Oct 06 Dec 06

2199,2

2 169,1

2269,2

2 151,8 2219,62 112,8

2 023

2 070,3

2 034,6

2 091,7 2329,1

2313,6

2253,3

Customer’s resourcesSight deposits

Savings deposits

Term deposits

Other funds owed to customers

Total

31/12/06 31/12/05 31/12/04 31/12/03

487,186

1 063,980

740,958

36,981

2 329,105

414,354

994,471

583,623

30,601

2 023,048

349,3

944,6

533,1

29,8

1 856,8

300,9

883,3

462,2

23,8

1 670,2

A record level of the sight deposits registering a rise of �2,� MD

A revival of the customer’s resources , exceed-ing for the first time, the registered growth made by the productive debts.

As a matter of fact, the customer’s resources have continued their upward trend reaching 2 329,1 MD by end 200� against 2 023 MD on 31/12/2005, that is two times more than the pre-vious year (1��,2MD) representing 213,2% of the anticipated objectives fo year 200�.

The evolution of the customer’s resources is rep-resented as follows :

A record level of sight deposits

The sight deposits have increased of �2,� MD bringing up the total to 4��,2 MD on 31/12/200� against a rise of �5 MD during the year 2005 and a previsional flow of 5�,� MD, exceeding the objectives anticipated for the year 200� with an achievement rate of 124,1%.


883,3 944,6 994,5 1 064

462,1 533,2583,6

741

487,2414,4349,3301

2003 2004 2005 2006

Saving depositsTerm depositsSight deposits

TMP

Deposit certificates

Term accounts

Cash bills

TMP global

4,87%

5,37%

5,27%

5,31%

4,53%

5,25%

5,28%

5,16%

31/12/2006 31/12/2005the purchase and sale operations on the treasury values have generated products of 13,� MD by end 200� against 10,5 MD the previous year, that is an additional profit of 3,1 MD against a profit of only 0,5 MD at the same date of the

previous year.

A reinforcement of the saving deposits mainly funded by the saving deposit EL JADID

The saving deposits have increased of �9,5 MD against 51 MD previsioned for the year, that is an achievement growth of 13�,3%. This rise de-rived essentially from the special saving accounts which increased of 49,5 MD against a previsional flow of 35 MD and also of the deposits EL JADID which witnessed a revival by registering a rise of 14,� MD against 15 MD previsioned for the whole year.

An increase of the Term deposits (+157,3 MD)

The Term deposits have also registered an impor-tant rise of 15�,3 MD against only 50,5 MD the previous year, exceeding largely the period’s pre-visions (+ 30,9%).

Concerning the balanced average cost of Term Deposits, it slightly increased of 0,15% reaching 5,31% by end 200� against 5,1� on 31/12/2005.

Collection of the borrowing’s resources for an amount of 35 MD

As a matter of fact, the borrowings have wit-nessed a positive variation of an amount of 20,5 MD issued from the first part of the credit BAD of an amount of � MD, then the second part of the same credit of an amount of 25,3 MD and the second part of the credit BEI of an amount of 2,� MD.

A reimbursment of the borrowings resources of an amount of 14,7%

During year 200�, the reimbursment of the bor-rowings have increased of 14,� MD, particularly : the bond issue of 12 MD, the first part of he credit BAD of 1,� MD, the first part of the credit BEI of 0,5 MD and the credit HG004C of 04 MD.

A steady development of TRESORY activity

During the year 200�, the bank’s net Treasury has witnessed a relaxing situation in spite of the tight-ening registered the previous year. As a matter of fact, the bank’s Treasury has reached 134,9 MD by end 200� against ��,4 MD BY END 2005.

In addition, the purchase and sale operations on the treasury values have generated products of 13,� MD by end 200� against 10,5 MD the pre-vious year, that is an additional profit of 3,1 MD against a profit of only 0,5 MD at the same date of the previous year.

2�ANNUAL REPORT 200�

Evolution of the contribution to economyYear 2002 - 200�

2 313,4

2 807,6

2 442,4

Figures in MD

3 143,5

2 617,0

1 500

2 000

2 500

3 000

2002 2003 2004 2005 2006

Evolution of the outstanding performing loans

Figures in MD

2002 2003 2004 2005 2006500

800

1 100

1 400

1 700

2 000

2 300

A more important intervention for financing the contribution to economy (+12%)

The contributions to economy have increased of 3 143,5 MD as of 31/12/200� against 2 �0�,� MD the previous year showing a growth of 335,9 MD (+12%) issued, on one hand, from the net resources lending and providing about 324 MD, and 11,2 MD from the portfolio securities, on the other hand, and 0,� MD from the special resources credits.

A development of the performing loans which registered a growth of ( + 12,6% ) against 9,5% the previous year.

On December 200�, the performing loans have been fixed at 2 3�4,5 MD against 1 100,� MD as of 31/12/2005 registering a growth of 2�3,� MD with a growth rate of 12,�%. The revival of the performing loans is considered as a performance especially that this activity con-tinued its upward tendency that was started in the beginning of year 2004. As a matter of fact, the performing loans have progressed of 10�,9 MD in 2004 and 1�2,9 MD in 2005, and have achieved a rise of 2�3,� MD during year 200�.

This evolution was related essentially to the com-mercial credits which registered a rise of 114 MD (+32%), the credits to individuals which increased of 3�%(+�9 MD) and to a lesser degree the real-estate credits (+24,9 MD) and the pre-financed credits (+1�,5 MD).

As of the pre-financed credits, the downward tendency has been broken with the revival of the real-estate promotion which has been confirmed in 200� notably in terms of the committments and utilization.Thus, the global outstanding pre-financed credits have increased of 1�,5 MD and fixed to 253,� MD on 31/12/200� against 23�,1 MD by end of year 2005.

The approved envelope has reached 1��,9 MD by end December 200� against 1�1,3 MD pre-visioned forthe whole year 200�, thus achieving 9�% of the anticipated previsions.

In terms of fund releases, they registered a rise amounting to 131,2 MD on 31/12/200� while the previsions banked on 121,3 MD, that is an achieving rate of 10�%.


Figures in MD 2003 2004 2005 2006

Provisions

Provisions+ Reserved Agios

Provisions + Classified Agios

Provisions + Reserved AgiosClassified debts

126 594

186 369

48,36%

71,19%

94 747

149 272

33,03%

52,04%

122 934

182,938

34,36%

51,13%

93,611

144,684

26,79%

41,40%

126 594

186 369

48,36%

IN MD

Credits/Saving Housing

Direct credits

Credits / Savings ElJadid

2003 2004 2005 2006

57,2

103,4

11,4

68,7

88,9

9,7

78,8

57,8

5,5

73,8

52,6

1,0

Committments

Released funds

Outstanding

2003 2004 2005 2006

162

172

1203

170,8

167,3

1 178,1

140,9

142,1

1 145,4

138,8

127,4

1 133,9

Figuresin MD 31/12/03 31/12/04 31/12/05 31/12/06

Class

Class

Class 4 & 5

TOTAL

66 166

47 317

235 973

349 456

8 461

40 086

309 241

357 788

48 557

13 330

224 965

286 852

38 352

13 141

210 284

261 777

38 352

13 141

210 284

Impulsed by the confirmed revival of the direct credits (+13,5MD), the real-estate outstanding

credits have registered a rise of 24,9%.

Concerning the real-estate lendings, the autho-rizations have totalized 1�2 MD on 31/12/200� reflecting an achieving rate of 24,9 MD.

In parallel to authorizations, the released funds of the real-estate developers credits have registered an upward tendency by being set at 1�2 MD on 31/12/200� against 1��,3 MD the previous year, that is a rise of 4,� MD. This growth is essentially due to the released envelope granted to direct credits. (+14,5 MD) and to a lesser extent the saving credits eljadid (+1,� MD). As of the funds granted to the house-savings, they were reduced of 11,5 MD.

Registering a rise of 1 203 MD, the outstanding credits to real-estate developers have increased of 24,9MD. This rise has been impulsed both by the direct credits which increased of 13,5 MD to reach ��,� MD by end December 200� and by the house-saving credits which respectively in-creased of 1,�MD and 9,9 MD.

A steady improvement of the assets quality

The debts cover which took place during year 200� permitted the recovery of 33 MD for a to-tal volume of 1�2,2 MD of unpaid debts by end 2005 reflecting a recovery rate of 1�,1%. As of the revovery achieved at the level of the real-es-tate promotion, it reached 25 MD.

Thanks to the sustained effort of recovery and the sale of 9,4 MD to the General Company of Debts Recovery, the total classified debts were fixed at 2�1,9 MD on 31/12/200� against 2��,� MD by end 2005, that is a decrease of 24,9 MD.

The share of the classified debts of the bank in the total committmtments has clearly been improved in 200� reaching �,�5% by end December 200� against 9,�% in 2005 and 13,42% in 2004.

In parallel to this decrease, the cover rate of the classified debts has improved and reached �1,1�% against 52,04% in 2005, exceeding the anticipated rate fixed for the year 200� (�0%).


5 371,9 9 271,5

11 651,4 15 617,4

in mD

2003 2004 2005 2006

Evolution of the products related to the Foreign Department activity Year 2003 - 200�

The share of the classified debts of the bank in the total committmtments has clearly been

improved in 200� reaching �,�5% . The cover rate of the classified debts has im-

proved and reached �1,1�% against 52,04% in 2005, exceeding the anticipated rate fixed for the

year 200� (�0%).

In Dinar 31/12/06 31/12/05 31/12/04 31/12/03

Exchange and transfers

Foreign Trade

Dealing room in foreign currenciesCash exchange box

Total general

709 117

676 848

3 732 124

253 730

5 371 879

780 502

1 250 625

6 919 654

320 676

9 271 457

909 631

1 990 189

8 400 337

351 259

11 651 416

1 164 021

3 001 856

11 043 898

407 651

15 617 426

Consolidation of the investment portfolio

The investment portfolio have totalized 99MD by end 200� against 93,2 MD by end 2005 regis-tering a net growth of 5,� MD thanks to the in-vestment securities (+ 4,� MD) related to the risk capital funds deposited at SIM SICAR and also to the participation securities which increased of 1,2 MD.

Concerning the participation securities portfolio, it was characterized in year 200� by the following :

- Consolidation of the bank’s participation in the subsidiary’s capital : STIMEC for an amount of 1�� thousand dinars

- Increase of the bank’s participation at the com-pany SODINO for an amount of ��,5 thousand dinars

- Increase of the bank’s participation at the Bank-er’s House of �3,1 thousand dinars

- Sale of the bank’s participation in the capital of INVEST PARTENARIAT EPARGNE for an amount of �00,� thousand dinars.

- Reduction of the bank’s participation in the companies BOUMAKHLOUF, JNAYNET HAM-MAMMET and S.P.P.I for respective amounts of 42,5 thousand dinars, 93,4 thousand dinars and 100 thousand dinars.

A sustained growth in the activity of the Foreign Department and consolidation of its results

During year 200�, the foreign operations have maintained their important development started on 2004.

The turnover of the foreign trade securities domi-ciliation have increased of 3�4,9 MD, registering 1 320,5 MD on 31/12/200� against 955,� MD during year 2005.

As of the turnover of the foreign trade, it reached �29,1 MD by end 200� against �0�,2 MD the previous year, registering a growth of 120,9 MD, that is a rise of 19,9%.

During year 200�, the transfers have witnessed the most important variation, a rise of ��%, bring-ing up the total transfers to 1 �13,5 MD against 1.032 MD the previous year.

Finally, the Dealing Room has pursued its activity with the same dynamism that has been observed these last years, with a turnover of 11 424 MD during year 200� against 9 93�,3 MD the previ-ous year, that is a rise of 14,4%.

The following timetable retraces the products evolution related to the different activities of the Foreign Department :


- The bank’s teller’s machines network has been reinforced by 3 more Teller machines bringing up the total number to �� by the end of 200�.

At the level of operating activities

Consolidation of the Banking Net Product (+17,8%) On 31/12/200�, the Bank’s Net Product has progressed of 1�,�% to be fixed at 145,3 MD Against 123,3 MD the previous year. This growth is due to the important rise of the interests mar-gin (+12,� MD or 15,2%) and the rise of the net commissions (+5,�%) as well as the net profits on the securities portfolio (+3,�%).

As a matter of fact, the interests margin has continued its upward tendency witnessed dur-ing the 3 previous years to be fixed at 95,1 MD on 31/12/200� against �2,5 MD the previous year, registering a rise of 12,� MD (15,3%).

82,572,5

59,463,2

53,3

95,1

200620052004200320022001

Figures in MD

Evolution of the interests margin

The total of commissions and generated prod-ucts related to the Foreign Department has

increased of 34% during the whole year 200� against 25,��% the previous year, achieving 15,�

MD against 11,�MD by end 2005.

The most significant rise has been registered at the revenues of the Foreign Trade (+50,�%) mainly in terms of the export documentary credits operations (+121,�%) and the export documentary remittances (+121%)

An important improvement of the electronic banking

The Electronic Banking’s activity has been char-acterized during the year 200� by the following facts :

- The issuing of cards reached 153 921 by the end of 200� on a total number of accounts of 211 59�, reflecting an equipment rate of �2,�4%. The cards YASMINE have reached a volume of 32 034 cards against 13 �0� in 2005, that is an evolution of 132%.

- The affiliated network has reached 320 cus-tomers by the end of 200� against 2�� on 31/12/2005, that is a rise of (+15%)

- The achieved transactions during year 200� totalized 304,� MD against 2�4,� MD in 2005. The average monthly performance for one teller machine has reached 390,5 thousand dinars on 31/12/200� against 350 thousand dinars by end 2005.

- The operational volume has registered a net improvement. As a matter of fact, the with-drawal operations totalized 3.�0�,9�3 for a global amount of 3�� MD against respectively 2 9�4,242 operations and a total of 305,4 MD the previous year.


16%

66%

18%

Interest margin

Net commissions

Net profits on the securities portfolio

Constitution of BNP (Banking Net Product)

BNP / Total credits

Work force charges /BNPGeneral charges /BNP

BNP / work force

2003 2002200420052006

5,08%

31,99%

43,18%

76,4

4,81%

35,58%

49,06%

64,2

4,47%

38,58%

54,29%

54,3

3,90%

42,77%

60,97%

44,5

4,39%

36,37%

54,38%

47,9

The rise of the interests margin derives mainly from the revenues on the customers’s operations

which is explained by the revival of the lending activities and improvement in the structure of the customers’s resources which is more and more

constituted by the deposits at least cost.

Evolution of the Net Commissions

200620052004200320022001

20,917,9

15,61614,1

26,7

in MD

Thus, the financial intermediation margin has in-creased of 14,9 MD to be fixed at 105,� MD on 31/12/200�.

Concerning commissions, they continued their upward tendency observed during the 3 previ-ous years registering more and more significant evolution by improving the service quality and reviving the activities generating commissions.Registering a rise of 5,� MD, the net commis-sions have increased of 2�,� MD by end Decem-ber 200� against 20,9 MD the previous year.

As of the operations on securities, they regis-tered on the whole, a net profit of 23,4 MD, that is a rise of 3,� MD (+ 1�,9%) compared to the previous year, mainly issued from the Treasury Bills (BTA) which increased of 3,3 MD.

On 31/12/200�, compared to the total of cred-its, the BNP has generated 5,0�% against 4,�% the previous year, that is an improvement of al-most 0,3 points of percentage.

The BNP’s improvement has positively impact-ed on productivity. As a matter of fact, by end December 200�, the BNP by employee has reached ��,4 mD against �4,2 mD the previous year, that is an evolution of more than 20% com-pared to 2005.

A sustained control of the general charges and a significant improvement of the operat-ing rate

On 31/12/200�, the general charges have in-creased of �2,� MD against �0,5 MD by end De-


Bnp

Other Operating Products

Work Force charges

General Operating Charges

Gross Operating Result

2003 2002200420052006

145,3

10,6

46,5

16,2

93,2

123,3

9,2

43,8

16,6

72,0

104,9

7,2

40,5

16,5

55,2

86,4

5,5

36,9

15,7

39,3

93,6

5,6

34,1

16,9

48,3

In MD

72,0

93,2

55,248,339,342,1

2001 2002 2003 2004 2005 2006

Net ProvisionsEndowment

2003 2002200420052006

43,4 43,1 29,2 13,7 17,243,4

2001 2002 2003 2004 2005 2006

21,0

16,417,018,5

28,5

21,7

Evolution of the Net Result

Evolution of the Gross Operating Result

The operating rate has improved of � points percentage, reaching 43,1�% on 31/12/200�

against 49,0�% the previous year.

cember 2005, registering a rise of 2,2 MD due exclusively to the rise of the work force charges which increased of 4�,5 MD against 43,� MD the previous year.

A recovery of the Gross Operating Result, ex-ceeding largely the anticipations of the year

On 31/12/200�, the Gross Operating Result has been fixed to 93,2 MD against �1,9 MD the previous year, thus registering a rise of 21,3 MD (+29,5%) due, from one part, to the net improve-ment of the Banking Net Product and from anoth-er part, to the control of the operational charges.

The Gross Operating Result, has exceeded the initially assigned objective of �3 MD achieving for the whole year 12�,�% of the previsious.

A strong provisioning for a better risk cover

The net provisions endowment have increased of 0,3 MD to reach 43,4 MD on 31/12/200� against 43,1 MD the previous year.

Compared to the BNP, the net provisions en-dowment represent 29,�5% on 31/12/200�.

A performance of the Net Result

The Net Result has increased of 2�,5 MD by end of 200� against 21,� MD the previous year, that is a rise of �,� MD (+ 31,2%) considering the more important reinvestment level exonerated (20,1 MD) permitting to make profit from the fis-cal advantage.

An improvement of the profitability ratios

On 31/12/200�, the ratios analysis shows 11,4�% of ROE (Equity profitability) and 0,��% of ROA (Asset profitability).

Concerning the regulatory ratios , the liquidity ra-tio has reached 123,13% on 31/12/200� against 114,39% the previous year ; the risk cover ratio


The valuable BH share has also reflected on the foreign participation the share of which in the

Bank’s capital has been consolidated by 13,5% on 31/12/200� compared to 9,4�% on

31/12/2005. Thus, the share of the foreign capi-tals in the bank’s capital has reached 10,1 MD by end 200� against �,1 MD on 31/12/2005, that is

a rise of 42,2%.

has increased of �,1�% by end 200� against �,�3% on 31/12/2005.

Shareholding and evolution of BH share

By end 200�, the volume of the exchanged capi t a l s on the BH va lue has i nc reased of 34 55� 000 dinars against � 340 �31 on 31/12/2005, that is a rise of 2� 21� 1�9 dinars.The total number of the treated securities has in-creased during the year 200� to reach 2 153 9�4 securities against �40 04� the previous year.

The positive evolution registered at the level of the BH share was reflected by the improvement of the stock-exchange capitaization of 131,4 MD, achieving 294 MD by end 200� against 1�2,� MD on 31/12/2005 .

In addition, the value of BH share has reached 19,�00 dinars on 31/12/200� against 10,�40 di-nars by end 2005, that is a rise of �1%.

REPORT ON THE ACTIONS UNDERTAKEN DURING YEAR 200�


The bank’s performances achieved during year 200� are based on general optimistic actions to which the bank has committed itself to adopt since the end of 2003.

In 200�, the main actions undertaken by the bank throughout the year are as follows : Implementation of the decentralized credits to individuals

The decenralization of credits to individuals is included within the framework of improving the quality service offered to customers by grant-ing the sale points with software applications permitting the study of credit eligibility and the automatic establishment of credit securities in order to insure guaranty formalities at the level of the sale points.

In parallel, concerning the procedures review, dictated by the concern to maximise the cus-tomer’s satisfaction by placing him in the core of the bank’s interest, the consolidations rely on the following :

- The redefinition of the process of treating the credit files

- Decentralization of the credit decision

- Decentralization of the released funds process

- Decentralization of the guaranty procedures

Implementation of the decentralized credits to individuals

Launch of a new product Bancassurance : life insurance on the real-estate credits «DHAMEN» which is subscribed to cover the real-estate cred-its to individuals.

The strength of the product «DHAMEN» lies mainly in the guarantee to insurers ( borrower

and contributor) against the total temporary work invalidity, added to Death risk and total final and/

or partial invalidity

Project of credits to companies

The credit project to companies has allowed the network implication in the processing of credit, the clarification of every member’s role and the reorganisation of procedures and process. This new organisation applies to the following :

- The Sale point’s implication in the files ackow-legment receipt, direct contact with the relation, constitution of the credit file and its transfer to the credit Department

- The Regional Department, as a support structure, for issuing opinion on the commercial interest of the relation and effecting real-estate in-quiries and technical expertises.

- The Credit Department for study centraliza-tion and decision of all types of credits to com-panies

Implementation of the function : polyvalent counter-employee

This action is included within the reorganisation of the sale-points in order to create areas respond-ing more and more to the customer’s require-ments by offering services gathering conditions of both efficiencies and effectiveness.

Report on the actions undertaken during year 2006


As a matter of fact, the polyvalent counter-em-ployee has to effect all the current operations of the counter, receive the customer and be charged of his ordinary operations.

Progress of the debt-recovery project

To consolidate the action of recovery in matter of housing-credits which are allocated on the bank’s resources, it has been created a syn-thesis statement of the housing debt-recovery made available by way of softaware application in the sale points. This statement allows the re-sponsible to have a specific view on the debts situation and at the same time facilitates the files management and the revovery action.

Review of the bank’s conditions

In conformity with the Central Bank’s regulations in matter of bank’s conditions, and in view to in-sure direct debit of the bank’s commissions as anticipated in the central bank’s nomenclature, a thinking committee has been constituted to reor-ganize, follow-up and manage the bank’s condi-tions.

The committee’s work resulted in the following :

- Adding some commissions to our bank’s con-ditions scale based on the services presented by the bank such as the commissions related to Yasmine card, the study loans and «DHAMEN» product.

- Rising some conditions which have been inferior compared to the sector’s ones.

- Centralizing the management of conditions at the level of the operating Department

Implementation of entities based on SMS

In the framework of its communication strategy, the bank has implemented entities based on SMSin order to get closer to its customers.

The services based on SMS are provided in 2 forms : PULL and PUSH contracted with the

company TELECOM

Reorganization of archives

The technical committe’s reorganizational work in matter of archive has resulted in the following :

- Imposing precise inspection concerning the sup-porting documents constituting the physical and accounting movements before their transfer to the Archive Division.

- Banning direct withdrawal of documents from the archives and instituting new procedure requiring from all the bank’s departments who wish to exam-ine documents to send their request via an electron-ic message to the archive division, except for the General Inspection Department, the Legal & Con-tentious Department who are allowed to withdraw the needed documents after having signed a with-drawal form.

The electronic document management (GED)

This system would include all the bank’s unities which have a need to detain documents record and / or need to examine documents in the bank’s archives.

The anticipated improvements of this system re-side in the following :

- Rationalization of the information flow, reduction of the documents research timing and profit on the intern productivity

- Reduction of the physical storage capacity of documents and the general fees (photocopies, listings…)

- Reduction of paper exchange between the dif-ferent bank’s structures


This project is based on virtual learning allowing control of charges and cost reduction in matter

of training

- Physical security of archives (less loss of docu-ments and reduction of their physical exchange).

THE E-LEARNING PROJECT

The aim of this project consists in the implemen-tation of the e-learning system.

THE LAUNCH OF THE SED - BH PROJECT

This project is based on the concept of imple-menting a system of collection, treatment and exchange of information with the Central Bank of Tunisia’s Information Center.The anticipated objectives of this project are as follows :

- Compliance with the BCT’ s Information Center nomenclature and data exchange rules

- Improvement of the bank’s Information system

- Eeasiness and softeness of decision taking sup-ported by a rich and secured information system The approches of this project consist in the fol-lowing :

- Analysing the bank’s needs in order to comply with the new BCT’s requests

- Elaborating legal conditions of the Information system

- Achieving and implemeting the SED-BH system

Defining the operational modalities of the operat-ing and managing system of the SED - BH

DEVELOPMENT AND MAINTENANCE OF THE INFORMATION SYSTEM

During year 200�, the renewal of the bank’s infor-mation system denote the following :

- Development of the term-debt recovery pro-gram in matter of housing credits forbidding any customer’s cheque payment at the counters

- Development of the cash exchange application

- Integration of COBOL in the branches organized by user profile

- Development of inter-banking transfers in order to reinforce security control (management of out-standing, controlling the double use of transfers)

- Development of the savings program

- Development of the application related to the administrative payment operations management

- Development of the following modules :

* At the level of the branches and the central departments : Consulting from distance the his-toric situations of the savings accounts, credits, current-account recovery and accees to the cus-tomers data base .

* Automatic transmission of the cash exchange rates to the branches


* Development of a module permitting the re-ception and dispatching of the savings mouve-ments and the recovery received from the Foreign Department

* Development of a module managing the full and final payment of the staff credits and the re-maining housing credits

* Development of the salaries application that are issued from different institutions

* Development of the edition program related to the customers correspondences at the level of the pre-contentious permitting the address indi-cation on the Customers Data-Base

IMPLEMENTATION OF THE «ANTI-MONEY- LAUNDERING» PROJECT

In compliance with the international rules related to Anti Money Laundering, the bank has imple-mented the necessary measures to face the sus-pected operations and has proceeded to :

- Establish an action plan to face the regulations requests.

- Express the bank’s needs to implement an ac-tion plan.

- Implement the necessary equipment (team, pro-cess, applications)

- Adopt an organisational plan aiming to a good management of procedures and control of opera-tions

The bank has reviewed its statute according to the new dispositions of the companie’s com-

mercial code, to the law related to the security reinforcement of the financial relations and to the law ° 200� - 19 related to the credit departments

- Develop technical conditions for the computer science base which are necessary for the control and follow up of operations

- Develop training programs in favour of the con-cerned users.

NEW DISPOSITIONS ADOPTED BY THE BANK IN COMPLIANCE WITH LAW N° 2006 - 19 RE-LATED TO THE CREDIT DEPARTMENTS

The project has been approuved by the extraordi-nary general assemby of 27/02/2007

As a matter of fact, the bank has created :

- An executive credit committee aiming to study and follow up the bank’s financial activity.

- A compliance control unity ensuring and respect-ing the current regulatory dispositions as well as the good professional and moral practices.

- A risk committee aiming to ensure that the out-standing risks particularly in terms of credit, mar-ket, global interest rates, liquidity, paiement as well as the operational risks are correctly evalu-ated and controlled.

THE BANK’S PERSPECTIVES IN YEAR 200�


THE BANK’S PERSPECTIVES IN YEAR 2007

In year 200�, the bank will pursue with confidence its strategy registered in its general policy for the years 2004 - 200�.

YEAR 200� : Pursuing momentum started the previous years.

First, the bank will strive to finish the different proj-ects that have been started, namely the reogani-zation of its sale points, decentralization of the credits to individuals and solving all the problems related to processing.

The year 200� will be considered as consolidating the core activity of the bank which is the credits to individuals and more precisely the «housing cred-its». Given that the bank’s objective of sharing its credit portfolio between the commercial activity 40% and the credits to individuals �0% has been achieved.

The bank will watch over the satisfaction of its pri-vate customers by providing them with the best products matched to their needs.

In this context, the bank has adopted some new conditions concerning the real-estate credit ac-quisitions.

These readjustments consist in extending the re-inbursment duration, reviewing down the interest rates and reducing self-financing .

The bank intends to consolidate its long resourc-es by increasing its capital and contracting mid

and long term-borrowings in order to preserve its stability in terms of Asset-Liability adequation.

The capital increase

The capital increase has been evaluated at 15 MD, of which 10 MD in cash payment and 5 MD in provisions’ integration having a net con-tribution of 30 MD in the net worths.

Recourse to a subordinated loan The increase of capital presents, nevertherless, an insufficiency in the development of activity and


a need to improve the solvency ratio imposed by the coming into force of BALE II application.

During the year 200�, in order to remedy this in-suffiency, the bank has decided to contract a sub-ordinated loan on the local market of an amount of �0 MD for a � years period.

This choice relies on the fact that the subordinated loan is considered as quasi- equity as long as it is calculated on the net aquity and consequently on the determination of the solvency ratio.

These readjustments consist in extending the reinbursment period, reviewing down the interest

rates and reducing self-financing.

Issuing of a bond’s loan

In view to ensure a better adequacy of Asset-Li-ability, the mobilization of long resources would become a necessary alternative. Nevertherless, facing the high cost of the foreign resources, the bank has been oriented towards a bond’s loan of 70 MD for a � year period of which 2 exempted years.

FINANCIALSTATUS


31/12/2006

Balance Sheet Ended to 31/12/2006

ASSETS

AC1

AC2

AC3

AC4

AC5

AC�

AC�

31/12/2005 Variation 12/06 - 12/05

51 53� 120

292 3�5 �01

2 �5� 30� 3��

1�� 334 �03

99 030 ��9

43 440 1�2

214 392 4�0

3 �25 42� 042

21 23� �35

202 �5� 535

2 5�3 5�5 593

1�� 1�3 ��4

93 250 340

3� 53� �92

192 ��4 0�5

3 2�� 2�� 54

30 29� 3�5

�9 52� 0��

293 �40 �95

-9 �39 2�1

5 ��0 339

� 901 490

21 �2� 395

43� 13� 1��

142,��%

44,13%

11,4�%

-5,55%

�,20%

1�,�9%

11,2�%

13,33%

31/12/2006LIABILITIES

PA1

PA2

PA3

PA4

31/12/2005 Variation 12/06 - 12/05

�0 013 955

2 329 104 9��

59� �13 03�

4�9 2�0 123

3 4�� 012 0�0

30 020 554

2 023 04� 439

5�2 2�5 953

445 139 2�5

3 0�0 4�4 211

29 993 402

30� 05� 52�

3� 34� 0�2

44 140 �59

41� 53� ��9

99,91%

15,13%

�,4�%

9,92%

13,�1%

31/12/2006EQUITY STATEMENT 31/12/2005 Variation 12/06 - 12/05

CP1

CP2

CP3

CP4

CP5

CP�

�5 000 000

144 0�5 �95

414 04�

-� 505 21�

3� 439 43�

2� 494 3�1

24� 413 9�2

�5 000 000

129 250 �3�

414 04�

43� �04

21 �11 053

22� �14 �43

0

14 �14 95�

0

-� 944 023

� ��3 30�

21 599 31�

0,00%

11,4�%

0,00%

-203�,2�%

31,24%

9,52%

TOTAL OF LIABILITIES AND EQUITY STATEMENTS 3 �25 42� 042 3 2�� 2�� 54 43� 13� 1�� 13,33%

Cash and balances at central Bank, post office

and TGT

Loans and advances to banks and

financial institutions

Loans and advances to customers

Trading portfolio

Investment portfolio

Fixed assets

Other assets

TOTAL OF ASSETS

Deposits by banks and financial institutions

Customers deposits

Debts and special resources

Other liabilities

TOTAL OF LIABILITIES

Capital

Reserves

Other equity statement

Retained profits and losses

Profit and loss of the year

Profit and loss of the year after

accounting modifications

TOTAL OF EQUITY STATEMENT

FINANCIAL STATUES


Off Balance sheet statement - Period Ended to 31/12/200631/12/2006CONTINGENT LIABILITIES

HB1

HB2

31/12/2005 Variation 12/06 - 12/05

1�5 119 �5�

23 443 �11

151 ��5 94�

1�5 ��0 94�

340 990 �04

12� 34� 00�

1� �04 55�

109 542 450

11� 34� �4�

245 �93 �54

4� ��2 �52

5 �39 255

42 133 49�

4� 524 19�

95 29� 950

3�,51%

31,��%

3�,4�%

40,1�%

3�,�9%

31/12/2006COMMIMTMENTS GIVEN

COMMIMTMENTS GIVEN

HB4

HB5

31/12/2005 Variation 12/06 - 12/05

�� 9 ��4

0

�� 9 ��4

333 915

333 915

0

�� 223 ��9

��3 0�2 102

0

��3 0�2 102

1�1 �00

1�1 �00

0

��3 233 �02

14 �1� ��2

0

14 �1� ��2

1�2 215

1�2 215

0

14 9�9 9��

1,�2%

1,�2%

10�,50%

10�,50%

1,�4%

HB�

HB�

31/12/2005 Variation 12/06 - 12/05

2�4 �� 4�

�3 125 0��

1 21� �99

0

�1 90� 3��

34� �93 �32

35� �25 210

�� 14 509

1 �33 ��

0

�4 ��0 �21

425 439 �1�

-�4 15� 4�4

-3 4�9 422

-51� 1��

0

-2 9�2 234

-�� 45 ��

-20,��%

-5,24%

-29,�3%

-4,5�%

-1�,25%

31/12/2006

Guarantees and assets pledged as

collateral security

- Guarantees given to banks and


- Guarantees given to customers

Letter of credit

TOTAL OF CONTINGENT LIABILITIES

Financing commitment

- Commitments given to banks and


- Commitments given to customers

Securities commitment

- Equity participation not yet realised

- Securities to receive

TOTAL OF GIVEN COMMITMENT

COMMIMTMENTS RECEIVED

Financing commitment received

Guarantees received

- Guarantees received from the State

- Guarantees received from banks, financial

institutions and insurance institutions

- Guarantees received from customers

TOTAL


From 01/01/2006

To 31/12/2006

Profit and Loss Statement - Period going from 01/01/2006 to 31/12/2006

PR1

PR2

PR3

PR4

195 ��5 594

2� 9�9 102

22 �9� 30�

543 ��2

24� 09� ��4

1�1 �09 1�1

22 �34 5��

19 310 941

�44 23�

214 59� 924

13,90%

2�,42%

1�,5�%

-2�,93%

15,�1%

+23 �� 433

+� 234 51�

+3 5�� 3�5

-200 454

+33 49� �59

CH1

CH2

100 554 2�4

2 24� ��

102 �3� 202

�9 2�� 45�

1 �51 090

91 32� �3�

+11 2�� 15

+39� 5��

+11 50� 5�4

12,�3%

21,4�%

12,�0%

145 260 582 123 270 286 +21 990 296

PR5

/

CH4

PR�

/

CH5

PR�

CH�

CH�

CH�

From 01/01/2005

To 31/12/2005

variation 12/06 - 12/05

absolute relative

17,84%

Interest receivable

Fees and commissions receivable

Profits from trading portfolio and

financing operations

Income from investment portfolio

TOTAL OF BANKING OPERATING INCOME

BANKING OPERATING INCOME

Interest payable

Fees and commissions payables

TOTAL OF BANKING OPERATING CHARGES

BANKING OPERATING CHARGES

NET BANKING INCOME

Adjustments to provisions for bad and doubtful

debts and for contingent liabilities

and commitments

Provisions and adjustments to

investment portfolio

Other operating income

Staff costs

Administrative expenses

Depreciation and amortisation on fixed assets

Operating income

39 �0� 54�

3 3�� 5�3

9 19� 9��

43 �5� 5�3

1� �20 052

2 �� 1

2� 10� ��

3� �50 525

4 �13 253

10 �9� 124

4� 4�5 0�1

1� 254 �09

2 50� 945

4� 35� 093

Profits/losses on ordinary items

Tax on profit

Operating income on ordinary activities

PR�/

CH9CH11

49 �5�

9 9�� 313

3� 439 43�

14 ��

5 490 2�4

20 �31 149

-� 945 0��

2� 494 3�1

1 0�9 904

21 �11 053

Accounting Modifications

Profit and loss of the year after accounting modifications

-95� 023

+1 255 �90

+1 500 14�

+2 �1� 51�

-3�5 243

-2�0 92�

+21 249 42�

-2,41%

3�,1�%

1�,31%

5,9�%

-2,20%

-10,0�%

�1,39%

+34 �90

+4 4�� 02�

+1� �0� 2�9

23�,2�%

�1,53%

�1,4�%

-10 024 9�0 -92�,32%

+� ��3 30� 31,24%


31 / 12 / 2006 31 / 12 / 2005

224 25� 91�

-94 �� 214

2� 9�9 109

45 0�2 02�

-193 254 �9�

1�9 910 2�2

-15 12� 4�9

-�� 1� 44�

-111 029 043

-49 �54 5��

5 430 �43

-1 1�1 09�

-�1 0�� 40�

��9 �49

-� �01 002

-4 5�5 �9�

-11 �0� 949

20 �� 30

-� 49� �3�

13 2�9 �94

� 334 301

-�1 0�1 2�0

300 1�5 9��

239 094 �0�

Cash in flow from operating income

Cash out flow from operating charges

Loans from banks and financial institutions

Deposits inflow / deposits outflow from banks and financial institutions

Loans and advances / reimbursement of loan and advances from customers

Deposits inflow / Deposits outflow from customers

Available for sale securities

Outflow to staff and other sundry creditors

Amounts received from sundry debtors

Other cash flow from operating activities

Tax on profit

Interests of minority

OPERATING ACTIVITIES

NET CASH FLOW FROM OPERATING ACTIVITIES

25� 0�4 3��

-9� �23 �4�

-9� 0�5 053

12 1�3 100

-41� 432 52�

319 �52 3��

-11 3�0 9�3

4� ��3 2��

103 301 45�

22 305 �5�

-10 253 330

-3 404 0�4

12� 210 �4�

5�� 90

-2 �22 019

-9 131 354

-11 3�5 4�3

25 0�3 �3�

-� 499 939

1� 5�3 �9�

-� 2�0 100

12� 12� ��2

239 094 �0�

3�� 223 5�0

Interest and dividends received from investment securities

Purchase / sale on investment securities

Purchase / sale on fixed assets

INVESTMENT ACTIVITIES

NET CASH FLOW FROM INESTMENT ACTIVITIES

FINANCING ACTIVITIES

Issue of debt securities / Increase / decrease of especial resources

Dividends

NET CASH FLOW FROM FINANCING ACTIVITIES

Exchange rate effects on cash and cash equivalent

Variation of cash and cash equivalent of the current year

Cash and cash equivalent at the beginning of the year

CASH AND CASH EQUIVALENT AT THE END OF THE YEAR

Consolidated Cash Flow StatementPeriod going from 01/01/2006 to 31/12/2006


General Report Of The Auditor

1. General report on the financial statements

Pursuant to the mission which was entrusted to us by your General meeting, we present our general report to you on the audit of the financial statements of the Banque de l’Habitat closed at December 31, 200�.

We have audited the financial statements as of December 31, 200� of “Banque de l’Habitat”. These financial statements comprises a balance sheet, a off-balance sheet statement, a profit and loss statement, a cash flow statement and a sum-mary of significant accounting policies and other explanatory notes.

The management of the bank is responsible of the preparation and fair presentation of the finan-cial statements in accordance with the account-ing companies system in Tunisia and the regu-latory rules of the Central Bank of Tunisia. and that responsibility includes designing, implement-ing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstate-ment, whether due to fraud or error; selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Our responsibility is to express an opinion on these financial statements based on our audit.

Our audit was conducted in accordance with the auditing standards applicable in Tunisia and in ac-cordance with the circular of the Central Bank of Tunisia n° 93-23 of July 30, 1993. Those stan-dards require that the auditor comply with ethi-

cal requirements and that the auditor plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclo-sures in the financial statements. The procedures selected depend on the auditor’s judgment, in-cluding the assessment of the risks of mate-rial misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the bank’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.

An audit also includes evaluating the appropriate-ness of the accounting policies used, the reason-ableness of accounting estimates made by man-agement, as well as the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion

In our opinion, the financial statements are regu-lar and present fairly, in all material respects, the financial position of “Banque de l’Habitat” as of December 31, 200�, and of the results of its op-erations and its cash flows for the year then end-ed in accordance with the companies accounting system in Tunisia.


Without qualifying our opinion we draw atten-tion to the following observations on the financial statements: - As indicated in the notes to the financial state-ments: Note 23 - Effects of the accounting modi-fications, the bank proceeded to the correction of the recognition of the delay’s interests in the profit and loss statement on FOPROLOS and special projects during the period 1990 to 2005, as result of an audit conducted by the Ministry of Finances. Other corrections can be done on the delay’s interest on the customers’ accounts, but their amount depends in the results of the control and the answers of the bank (the controls are not achieved in the closing date of the financial state-ments).

- At the closing date of the financial statements, some adjustment accounts and interdepartmen-tal accounts are subject to conciliation operations with physical documents. Among this accounts the accounts related to PNRLR program. The re-lated accounts shows differences with the physi-cal situations held by the managing department of the PNRLR program. The conciliation can con-duct the bank to constitute provisions to cover the risks on the impaid credits for witch the bank have support a risk.

2. Specific diligences

We have performed a limited review in accor-dance with the international standards and the Tunisian laws.

Based on our limited review, we did not notice significant elements able to be in conflict with the financial information given in the management re-port about the financial position of the “banque de l’Habitat” in the year ended as of December 31,200�.

In addition, we did not raise or not taken knowl-edge of facts that able us to think that the se-curities emitted by the bank is not carried out in conformity with the decree n° 2001-2�2� of No-vember 20, 2001, relating to the conditions of in-scription of the transferable securities. Thus, the accounts of the transferable securities emitted by the Bank of the Habitat are kept for the consta-ble part of the capital by the intermediary in the stock exchange, the SIFIB, and for the stable part (State and largest shareholders) of the capital by the Bank itself.

Moreover, and in accordance with article 3 of the law n° 94-11� of November 14, 1994 as modified by article 15 of the law n° 2005-9� of October 1�, 2005, relating to the reinforcement of the safety of the financial relations, we carried out the examina-tion of the internal control procedures relating to the accounting information and the preparation of the financial statements. We inform you that the internal control procedures relating to the man-agement of the financial ressources of the state entrusted to the bank by the State comprise sig-nificant insufficiencies that we raised in our letter on the internal control and present report.

Apart from the situation described above, we did not raise, on the basis of our examination, others of major insufficiencies likely to impact our opin-ion on the financial statements.

Tunis, May 14, 200�

La Générale d’Audit et Conseil – G.A.CMembre de CPA International

Chiheb GHANMIAssociated


Pursuant to the mission which was entrusted to us by your ordinary general assembly, we pres-ent hereby our special report on the regulated conventions envisaged by articles 200 following and 4�5 of the code of the commercial compa-nies and article 29 of the law 2001-�5 of July 10, 2001 relating to the credit institutions as modified by the law n°200�-19 relating to the credit institu-tions. . 1. Conventions concluded during 2006

Pursuant to the provisions of articles 200 & 4�5 of the code of the commercial companies and 29 of the law 2001-�5 of July 10, 2001 relating to the credit institutions, we bring to your attention that the bank carried out the following operations during 200�:

The board of directors of the bank held on May 02, 200� authorized a transfer of credits to the profit of “Société Générale de Recouvrement des Créances”, subsidiary company of the bank. Un-der the terms of this convention, the bank dis-posed of credits having a total face value approxi-mately 9,249 million dinars for a delivery price of 3 million Dinars.

2. Conventions concluded during preceding exercises and which continue to produce ef-fects during 2006

Pursuant to the provisions of articles 200 & 4�5 of the code of the commercial companies and 29 of the law 2001-�5 of July 10, 2001 relating to the credit institutions, we bring to your attention that the following conventions concluded between the bank and the people aimed by these articles con-tinue to take effect during 200�:

- A convention of agent was concluded between SICAV BH PLACEMENT and BH OBLIGATAIRE since 1994. The commissions invoiced by the bank amount to 1 000 dinars HT for each one of them.

- Following conventions with the Tunisian State continue to produce effects during 200�.

SPECIAL REPORT OF THE AUDITOR


THE BANK’S SUBSIDIARIES


THE BANK’S SUBSIDIARIES

General overview on the subsidiaries activity as of 31/12/2006

The subsidiaries activity of BH has been charac-terized during the year 200� by a net improve-ment in its financial situation compared to the previous years.

The turnover achieved by the consolidated sub-sidiaries has reached �9,2 MD in 200� against 59,2 MD in 2005, that is a growth of 1�% , per-mitting the achievement of a surplus net result of �,� MD against 2,� MD in 2005, that is an evolu-tion of 13�%.

As a matter of fact, after implementation of the measures of stabilization and restructuring ad-opted in 2004 , the general situation of the bank’s subsidiaries has been confirmed and the net worths have been further consolidated, reach-ing ��,3 MD against �2,5 MD, thus registering a growth of �% (clearly superior to the one achieved between 2004 and 2005 which was of the order of 2,5%)

The following time-table shows the evolution of the financial indicators betwwen 2003 and 200� for the totality of the consolidated companies of the group

Net worth

Turnover

Net result

60,8

44,3

-3,8

60

50,7

0,9

62,4

59,2

2,8

66,3

69,2

6,7

Figures in MD

2003 2004 2005 2006

The improvement of result for most of the sub-sidiaries and the loss reduction for others, are il-lustrated and detailed for each subsidiary in the annexed time-table.

Main reports

Consolidated companies

SOPIVEL and SIM SICAR have joined the group companies having a surplus production.

* In 200�, the achieved turnover of SOPIVEL has reached �.� MD against 1.9 MD in 2005 As of the net result, it reached �19 mD in 200� against a deficitary result of 30 mD in 2005.

The year 200� has been characterized by the marketing of the residential project “KHEZAMA ECHARKIA“ in the city of Sousse, the pursuit of marketing the project “Residence Cité Jardins” * SIM SICAR has continued its progress by reinforcing its reputation on one hand and con-solidating its financial basis on the other hand. On 31/12/200�, its turnover has increased to 12�� mD against 1025 mD the previous year, thus, by the end of year 200�, its result has reached , after tax deduction, 12� mD against a deficitary result of 19� mD on 31/12/2005.

SALIM INSURANCE COMPANY, SIFIB, MOD-ERN LEASING and SICAF have continued their comforting progress


* SALIM INSURANCE has continued its steady upward progress by registering a rise in its turn-over of 25 MD in 200� against 23,5 MD in 2005, showing also an improvement in its result of 2,1 MD in 200� against 1,5 MD in 2005, registering an upward movement of 39%.

* SIFIB has distinguished itself by achieving a net result of 41� mD on 31/12/200� against 10� mD the previous year, that is a growth rate of 2�9%.

* MODERN LEASING’s activity remained sta-bilized in spite of a non favourable environment characterized by an unstable and very competi-tive market (mergers, disintegration of many leas-ing companies). As a matter of fact, its net turnover has increased of 3424 mD on 31/12/200� against 3230 mD the previous year, for a result reaching 1039 mD during year 200� against 1002 mD in 2005.

Some improvements have been achieved by SICAF EI, in fact, its turnover has reached �21 mD, its net result has increased of 2.5 MD, which is mainly due to a rise in the added value on the securities sale, the findings of a latent added value on 31/12/200� on the BH securities of an amount of 15�,�95 mD and the increase of dividends re-ceipts of 21% as well as carry-back provisions of about 3,� MD.

In spite of this progress, the bank took the de-cision to disintegrate this subsidiary transferring tax benefits to companies of the SICAR type.

THE COMPANIES S.M TITRISATION & BM TECHNOLOGIIES have pursued their deficit reduction

* The net result of S.M TITRISATION has im-

proved, it reduced its deficit from 149 mD to 93 Md.

Today, in the absence of activity perspectives, the company has been put on the back burner. It is worth noting that in vue to reinforce its net worths, the bank foresees the launch of the first RMBS (Residential Mortgage-Backed Security).

* For B.M. TECHNILOLOGIES, the year 200� has been characterized by a net deficitary result of �4 mD against a deficitary result of 119 mD in 2005. In the absence of promising perspectives of activ-ity for this company, the bank took the decision to disintegrate this subsidiary.

* The SGRC (debt’s recovery company) has witnessed a decrease in its turnover of 41% of the order of �0,5 mD on 31/12/200� compared to 119,�3� mD by the end of year 2005 caused by the financial charges and the decrease in the achieved products

This fall is due to the slowness of the legal pro-cedures previously started and committed and to the non-respect of some creditors’ arrange-ments. This situation is not preoccupying as long as its core activity - debts recovery - has made a prog-ress.

The STIMEC net result has receded by register-ing a worse deficitary situation of �� mD com-pared to 32 mD in spite of an �% rise in its turn-over reaching 11�0 mD in 200�.

The future perspectives of the company (signed contracts, african perspective cooperation) fore-see interesting activity opportunities for the years to come .


Non-consolidated companies

The investment companies of transferable values (SICAV-BHP & SICAV BHO) non-integrated in the consolidation area have achieved a net asset improvement reaching �9,5 MD in 200� against �� MD in 2005 with a surplus result of 4,� MD against 2,� MD in 2005.

As of the future perspectives, they remained de-pendent of the financial market conditions.

The figures achieved by the group’s companies

prove that the measures adopted by the bank’s management council have responded to the anticipated results and the subsidiaries future promises to be reassuring.

As a matter of fact, the net result of all the sub-sidiaries have gone past a deficitary situation of 3,� MD in 2003 to a profitable situation of �,� MD in 200�, that is an increase of 2��% while at the same time the number of surplus companies have reached � subsidiaries instead of 4 subsidiaries.


MANAGEMENT REPORT

OF THE GROUP BANQUE DE L’HABITAT

MANAGEMENT REPORT

OF THE GROUP BANQUE DE L’HABITAT

�2 ANNUAL REPORT 200�

Banque de l’Habitat

Company of financial engeneering and stock market intermediation

Invest saving company (SICAF)

SICAV - BH - DEPOSIT

SICAV - BH - BOND

SOPIVEL (Real-Estate and sale promotion, house renting company)

Insurance Company SALIM

Modern Leasing

SIM SICAR (Modern Investment Company)

STIMEC (Tunisian Company of printing and elaborating cheques)

BM- Technology

General Company of Debts Recovery

Modern company of titrisation

Presentation of the BH group

The BH group is constituted of the following companies :

Denomination Activity

MANAGEMENT REPORT OF THE GROUP

BANQUE DE L’HABITAT

Banking

Financial Intermediation

Management of transferable values portfolio



Real- Estate

Insurance

Leasing

Investment at risk capital

Elaboration of cheques and edition ofconsumable products

Computing department

Debts’ recovery

Titrisation

�3ANNUAL REPORT 200�

BANQUE DE L’HABITAT

Consolidated companies

- Company of financial &Stock market intermediation (SIFIB)

- Invest saving company (SICAF)

- Real-Estate promotion, Sale & house renting company (SOPIVEL)

- Salim Insurance Company

- Modern Leasing

- Company of modern investment (SIM SICAR)

- Company of modern investment (STIMEC)

- BM - Technology

- General company of debt’s recovery

- Modern company of titrisation

Non-Consolidated companies

- Investment company at variable Capital (SICAV-BH-O)

- Investment company at mixed variable capital (SICAV BH-P)

Total

Financial indicators of the group’s companies

The main indicators of the group’s companies are illustrated in table below as at 31/12/2005

Denominationtotal balance net worths turnover net profit

2005 2006 2005 2006 2005 2006 2005 2006

3 2�� 2�9

234 12�

4 344

13 1�3

� 953

49 3�1

�3 2�5

�� 04

2 103

233

5 403

4�9

�� 2

�4 5�4

4 11�

3 600 099

3 725 426

260 687

4 144

15 722

10 910

57 718

63 227

102 496

1 989

71

4 008

402

80 151

74 448

5 703

4 066 264

22� �15

�1 592

3 0�4

13 12�

2 ��

13 25�

11 515

15 �5�

594

-5��

2 151

-51

�� 055

�4 22�

3 �2�

366 462

248 414

67 291

3 479

15 690

3 387

13 962

12 519

15 864

983

-663

2 221

-151

79 481

74 067

5 414

395 186

214 599

59 200

�05

4�9

1 9��

23 5�5

29 �53

1 02�

1 0��

1�3

524

-

3 410

3 25�

154

277 209

248 097

69 243

753

821

6 694

25 050

32 926

1 288

1 160

65

486

-

4 017

3 824

193

321 357

21 �11

2 ��

10�

�49

-30

1 509

1 002

-195

-32

-119

120

-143

2 �39

2 521

31�

27 418

28 494

6 757

416

2 564

719

2 102

1 039

126

-87

-102

70

-90

4 603

3 148

1 455

39 854


Activities of the group’s companies

For the year 200�, the activity of the BH group has been characterized by a net improvement of its financial situation compared to the previous years.

The achieved turnover of the consolidated sub-sidiaries has reached around �9,2 million dinars in 200� against 59,2 million dinars in 2005, which permitted to achieve, except the parent compa-ny BH, a net surplus result of �,� million dinars against 2,9 million dinars in 2005.

The financial recovery measures and support of the commercial development which have been started by the bank in 2004 have permitted a fur-ther consolidation of its net worth, thus register-ing a growth of �,25%, that is a positive evolution of around 3,2 million dinars compared to year 2005.

This could be felt at the subsidiaries level which have achieved a net surplus result, except for BMT (Business Management Technology), STIMEC (Tunisian Company of Printing and Elaborating cheques), SMT (Modern Company of Titrisation) wich kept witnessing difficulties and registering deficit results in spite of the charges control.

As a matter of fact, the social result of all the sub-sidiaries has reached �,�% million dinars, that is a rise of 3,9 million dinars compared to year 2005.

In fact, the SICAF who benefitted from the special conditions of the financial market has achieved an added value on the securities sale and con-sequently registered a remarkable improvement of its surplus result reaching 2,5 million dinars in 200� against 0,� million dinars in 2005.

Considering the measures of stabilization and financial restructuring adopted by the subsidiar-ies on one hand and the provisioning effort of the group, on the other hand, the contribution to the consolidated result has been positive and main-tained the group’s result at the same level as the bank’s result , that is 2�,5 million dinars.

Consequently, the group’s consolidated reserves have registered a rise of nearly 1�,� million di-nars due mainly to the rise of the bank’s reserves. The consolidated group’s reserves have reached 13�,� million dinars in 200� against 121,9 mil-lion dinars in 2005, that is a positive evolution of 13,�%.

The investment companies of transferable values portfolio or mutual fund non integrated in the con-solidation area has achieved a net asset improve-ment of �9,5 million dinars in 200� against �� million dinars in 2005, with a surplus result of 4,� million dinars against 2,� million dinars in 2005.

Consolidated result

The consolidation by the globally integrated meth-od of the companies included in the consolidation area has led to a consolidated result of the group after amortization of the acquisition gap and the minorities share of 2�,4 million dinars

During year 200�, the rise of the consolidated re-sult is of � million dinars compared to year 2005 due to the improvement of the social group’s result which is mainly issued from the BH result achieving 2�,5 million dinars in 200� against 21,� million dinars in 2005, thus registering an increase of �,� million dinars , that is a growth of 2�,11%.


CONSOLIDATEDFINANCIAL FIGURES

�� ANNUAL REPORT 200�

Note

CONSOLIDATED FINANCIAL STATUS

ASSETS 31/12/2006 31/12/2005 VARIATION

AC1AC2AC3AC4AC5

AC�AC�

51 53� ��294 955 5�1

2 90� 439 535235 244 5234� �91 ��

��2 19352 4�2 234

211 �3� 4003 �01 ��0 920

21 23� �321�9 �4� 520

2 �13 91� ��9229 141 91349 99� 4041 01� 193

4� 140 52�211 933 �24

3 343 23� �92

30 299 954125 10� 041292 520 �5�

� 102 �10-1 30� �1�

-33� 000� 341 �0�

-9� 42445� �32 02�

Note 31/12/2006 31/12/2005 VARIATION

PA1PA2PA3PA4PA5

0�0 013 955

2 313 591 �0��20 3�4 9�153� �9� 2�2

3 531 �� 24

024 040 �92

1 991 �52 �9559� �3� 1��4�� 223 �5�

3 101 �55 511

035 9�3 0�3

321 93� �1121 �2� �1450 5�2 �2�

430 111 313

Note 31/12/2006 31/12/2005 VARIATION

CP1CP2CP5CP�

Total of liabilities and equity statement 3 �01 ��0 920 3 343 23� �92 45� �32 02�

Cash and balances at central Bank, post office and TGTLoans and advances to banks and financial institutionsLoans and advances to customers Trading portfolioInvestment portfolioGOODWILLFixed assets Other assetsTotal of assets

Central bank of tunisia, CCPDeposits by banks and financial institutionsCustomers deposits Debts and special resourcesOther liabilitiesTotal liabilities

�3 �00 00013� ��9 240

-� 3�9 1353� 243 �092� 441 �542� ��0 1�2

2�0 104 09�

01� �� 030

015 �94 1��

4 32� �52

2� 520 �15

�3 �00 000121 901 210

021 449 �41

024 432 530

241 5�3 3�1

LIABILITIES

EQUITY STATEMENT

Capital Reserves ACTIONS PROPRESRetained profits and losses Consolidated profit of the yearConsolidated profit of the year after accounting modificationsTotal of equity statement

Consolidated balance sheet 31/12/2006


Note 31/12/2006 31/12/2005 VARIATION

HB1

HB2

1�5 5�� 423 443 �11

152 145 0531�5 ��0 94�341 459 �10

12� 34� 00�1� �04 55�

109 542 45011� 34� �4�245 �93 �54

4� 241 �5�5 �39 255

42 �02 �034� 524 19�95 �� 05�

Note 31/12/2006 31/12/2005 VARIATION

HB4

HB5

Note 31/12/2006 31/12/2005 VARIATION

HB�HB�

2�4 �� 4�� 3�2 9411 21� �99

0

�5 1�� 242351 051 ��

34� �� 424�� 14 5091 �33 ��

0

�4 ��0 �21413 301 933

-�2 01� ��-231 5��-51� 1�9

0

2�5 �21-�2 250 24�

Guarantees and assets pledged as collateral security - Guarantees given to banks and financial institutions- Guarantees given to customersLetter of creditTotal of contingent liabilities

CONTINGENT LIABILITIES

Financing commitment Commitments given to banks and financial institutions Commitments given to customers Securities commitment Equity participation not yet realised Securities to receive Total of given commiment

�� 5�4 5�00

�� 5�4 5�0333 915333 915

0�� 9� 495

��3 0�2 1020

��3 0�2 1021�1 �001�1 �00

0��3 233 �02

24 492 4��0

24 492 4��1�2 2151�2 215

024 ��4 �93

COMMIMENTS GIVEN

Consolidated off - Balance sheet statement 31/12/2006

Financing commitment receivedGuarantees receivedGuarantees received from the StateGuarantees received from banks, financial institutions and insurance institutionsGuarantees received from customersTotal of commiments received

COMMIMENTS RECEIVED


Consolidated Profit and Loss Statement 31/12/2006

Note 31/12/2006 31/12/2005 VARIATION

PR1PR2PR3PR4

195 4�2 �1229 553 05122 4�� 4��

5�� 9024� 0�0 129

1�� 3�5 30�23 220 �1220 �0� 4��

�9� 5�2221 101 1��

19 09� 40�� 332 2391 ��0 00�-230 �92

2� 9�� 9�1

Note 31/12/2006 31/12/2005 VARIATION

CH1CH2

102 0�4 4112 �42 512

104 92� 923

91 305 5411 �10 3��

93 015 919

10 �� 01 132 135

11 911 004

Net banking income 143 143 20� 12� 0�5 249 15 05� 95�

CH9 / PR�CH11

2�� 33

10 253 330-3 404 0�43� 243 �093� 243 �09

51� 3�3

5 430 �43-1 1�1 09�21 449 �4121 449 �41

-22� �30

4 �22 4��-2 222 9��15 �94 1��15 �94 1��

Accounting modificationsProfit and loss of the year after accounting modifications

-� �01 9552� 441 �54

021 449 �41

-� �01 955� 992 213

CH4/PR5CH5/PR�PR�CH�

CH�

CH�

-40 4�0 15�

-5 392 0�0

40 545 9�2-4� �20 3��-3� 430 245

-2 9�3 �31

50 �12 490

-42 �53 209

-4 22� 11�

33 3�4 5�2-45 022 �05-3� 430 ��

-3 4�1 �92

2� 545 219

2 2�3 053

-1 1�5 952

� 1�1 390-2 �9� ��12 000 �43

51� 9�1

23 0�� 2�1

Interest receivable Fees and commissions receivable Profits from trading portfolio and financing operations Income from investment portfolioTotal of banking operating income

BANKING OPERATING INCOME

Interest payable Fees and commissions payables Total of banking operating charges

BANKING OPERATING CHARGES

Adjustments to provisions for bad and doubtful debts and for contingent liabilities and commitments Provisions and adjustments to investment portfolio

Other operating income

Staff costs

Administrative expenses

Depreciation and amortisation on fixed assets

Operating income

Profits/losses on ordinary items

Tax on profitMinority interestsOperating in come on ordinary activitiesProfit of the year


Consolidated Cash Flow from 1/01/2006 to 31/12/2006

ITEM 31/12/2006 31/12/2005

Net cash flow from operating activitiesNet cash flow from investment activitiesNet cash flow from financing activitiesExchange rate effects on cash and cash equivalentVariation of cash and cash equivalent of the current yearCash and cash equivalent at the beginning of the yearCash and cash equivalent at the End of the year

12� 210 �4�-11 3�5 4�31� 5�3 �9�-� 2�0 100

12� 12� ��2239 094 �0�3�� 223 5�0

-�1 0�� 40�-11 �0� 94913 2�9 �94� 334 301

-�1 0�1 2�0300 1�5 9��239 094 �0�


Statutory auditors’ opinion on the consolidated financialstatements as of december 31, 2006 of “banque de l’habitat” group

1- Opinion on financial statements

We have audited the consolidated financial state-ments as of December 31, 200� of the group of “Banque de l’Habitat”.

These consolidated financial statements which include a consolidated balance sheet, an con-solidated off-balance sheet statement, a consoli-dated profit and loss statement, a consolidated cash flow statement and notes to the consoli-dated financial statements are prepared under the responsibility of the company’s management. Our responsibility is to express an opinion on this financial statements based on our audit. We have conducted our audit in accordance with the international standards on auditing. This stan-dard requires that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material mis-statement.

An audit includes examining, on a test basis, evi-dence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial state-ments are regular and present fairly, in all mate-

rial respects, the financial position of the group of “Banque de l’Habitat” as of December 31, 2005, and of the results of its operations and its cash flows for the year then ended in accordance with the company’s accounting system.

Without reserves on our opinion indicated above, we inform you that we don’t obtain the financial statements of “BM TECHNIOLIES” making par of the perimeter of consolidation of the group.

2- Specific examinations

We have performed a limited review in accor-dance with the international standards and the Tunisian laws.

Based on our limited review, we did not notice significant elements able to be in conflict with the financial information given in the management re-port about the consolidated financial position of the group “banque de l’Habitat” in the year ended as of December 31,2005.

Tunis, April 10, 200�

La Générale d’Audit et ConseilMember of CPA Associates International

Chiheb GHANMIAssociated


DRAFTRESOLUTIONS

�� ANNUAL REPORT 200�

DRAFT RESOLUTIONS

Draft resolutions submitted to the ordinary general meeting

FIRST RESOLUTION

The annual ordinary general meeting, having examined the report of the Board of Directors (pertaining to the individual financial situation and the consolidated financial situation) and after having listened to the reading of the reports (general and special on the individual situation) and the general report of the consolidated situation of the auditor for the financial year 200�, approves the report of the board as well as the individual and financial statements as of December 31, 200�.

As a consequence, it gives the board members, full discharge without reserve for their management during the financial year 200�.

This resolution is adopted unanimously

SECOND RESOLUTION

The general ordinary meeting, after reading the special report of auditor for the year 200�, agrees on the approuved conventions of the articles 200 & 4�5 related to the commercial code of companies.


THIRD RESOLUTION

The ordinary general meeting approves the distribution of the net profits pertaining to the financial year 200� as it was presented by the board of directors, namely :

Category Amount 31/12/2006

Net profit

Legal reserves

1st balance

Balance carried forward

2nd balance

Dividend and super dividend

3rd balance

Social fund

4th balance

Percentage allocated to the board members

5th balance

Balance carried forward

Balance

2� 494 3�1,350

3 594 �14

2� 49� 95�,1�4

-

2� 49� 95�,1�4

� 500 000 000

20 99� 95�,1�4

�50 000 000

20 14� 95�,1�4

20 145 000,000

2 95�,1�4

2 95�,1�4

-

Figures in Dinar

��ANNUAL REPORT 200�

Consequently, the general ordinary meeting fixes the gross amount of dividends to be distributed to the shareholders at 500 millimes per share. The paiement of these dividends shall be effected starting from june � th, 200� by the stock exchange intermediary or the holder of the portfolio depositary account.

This resolution is adopted by the majority

FOURTH RESOLUTION

The general ordinary meeting renews the mandate of Mr Ahmed TRABELSI as a member of the board of directors, for a 3 years period, ending the day of the general ordinary assembly which will have to rule on the statements of the year 2009


FIFTH RESOLUTION

In accordance with the law n° 2005-9� of October 1�, 2005 related to the security reinforcement of the financial relations and the law n° 2001-�5 related to the credit institutions as modified by the law 19 of May 2nd, 200�, the general meeting gives full power to Mr Mounir GRAJA - Mr Wassim TURKI (AWT) & Mr Moncef BOUSSSANOUGA ZAMMOURI (KPMG) auditors for the period of 200�-2009.


SIXTH RESOLUTION

The general meeting decides to fix the annual amount of the director’s fees to TND 5000 to be attributed to each director


SEVENTH RESOLUTION

For completion of the deposit arrangements, legal publications and others, full power shall be conferred to the holder of a statement or copy of the present ordinary general meeting.

This resolution is adopted unanimously.

Documents

His excellency ZINE EL ABIDINE BEN ALI President of … · Head office : 21, avenue Kheireddine Pacha 1002 - Tunis Belvédère Tél. : 71 110 000 / Fax : 71 784 417 Voice server :