September 03, (THEWILL) – Nigeria’s biggest lender by market value, Guaranty Trust Holding Company (GTCO) reported profit before tax of N327.4 billion in 2023 half year, representing an increase of 217.1% over N103.2 billion recorded in the corresponding period ended June 2022.
The feat was achieved on a vast expansion in foreign exchange revaluation gains which contributed more than half of the revenue reported for the period.
Gross earnings quickened by 181 per cent to N672.6 billion, with the corporate banking unit accounting for 68.9 percent of revenue. Net interest income scaled up 46.8 per cent to N177.5 billion.
The financial institution, whose flagship commercial banking division has a chunk of its loans denominated in the US dollar, benefitted enormously from roughly 40 per cent weakening of the naira in June. This allowed repayments on such credit to surge in local currency, consequently boosting revenue and profit.
Credit impairment for the period sprang to N82.9 billion from N3.5 billion, translating to an increase of 2,257.5 per cent within a year.
Other income rose by 2,482.5 per cent to N372.2 billion, supported by an unusual foreign exchange revaluation gain, which contributed 96 per cent of that sum.
Profit for the period climbed to N280.5 billion from N77.6 billion a year earlier. Net profit margin, which measures how much of revenue has turned into profit, stood at 41.7 per cent. It was 31.7 per cent a year earlier.
The directors have proposed an interim dividend of N0.50 per share, translating to a payout of N14.7 billion.
The Group’s loan book (net) Increased by 22.8% from N1.89trillion recorded as of December 2022 to N2.32trillion in June 2023, while deposit liabilities grew by 37.0% from N4.61trillion in December 2022 to N6.32trillion in June 2023..
Full Impact Capital Adequacy Ratio (CAR) remained very strong, closing at 24.7%, while asset quality was sustained as IFRS 9 Stage 3 Loans improved to 4.6% in June 2023 from 5.2% in December 2022.
Commenting on the results, the Group Chief Executive Officer of Guaranty Trust Holding Company Plc (GTCO Plc), Mr. Segun Agbaje, said:
“Our half-year audited results reflect the strong business fundamentals underpinning the GTCO franchise, the quality of our past decisions in future-proofing our balance sheet for challenging times and the sound practices that guide our day-to-day operations.
“Despite the challenges in the business environment, notably inflationary pressures, and exchange rate fluctuations, we are starting to see the gains in the transformation of our businesses following our transition to a Holding Company structure.
“Improved profitability and solid performance across key metrics reflect efficiencies and justify the investments we continue to make in technology, product development and our people.
He further said;
“We recognize the impact prevailing economic and market conditions have on people and livelihoods and we remain committed to seeking better outcomes for our customers, by ensuring that our products and service offerings support our customers and their businesses through their evolving realities, whilst also taking every opportunity to optimize stakeholder value.”
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