GTCO Records Milestone Achievements in Profits, Total Assets

Kayode Tokede

Guaranty Trust Holding Company Plc (GTCO) half year (H1) ended June 30, 2023 audited result and accounts showed a milestone performance in profit before and total assets that translated into robust interim dividend to shareholders.

In the history of the financial institution, profit before tax crossed the N300 billion mark, and the management for the first time in its history is paying shareholders N0.50 per share as an interim dividend.

In the 2022 full financial year, GTCO declared N214.15billion profit before tax, and in the 2021 financial year, N221.5billion. Further findings showed that GTCO in 2020, it announced N238.1billion profit before tax and in 2019 and 2018, the Group announced N231.711billion and N215.6billion profit before tax, respectively. 

Also, total assets crossed N8 trillion as of June 30, 2023, driven by deposits and loans & advances to customers in the period under review.

GTCO’s growth in H1 2023 is on the backdrop of weak global oil price, tied with economies across African countries continuing to experience monetary tightening in reaction to persistent inflation rate.

The Group also achieved a milestone in gross earnings that stood at N672.6billion in H1 2023, an increase of 181.1 per cent from N239.3billion in H1 2022, driven by growth in core banking activities from increased transactional volumes and enhanced other Income.

Interest earnings grew by 53.5 per cent to N225.95billion in H1 2023 from N147.2billion in H1 2022 and it is as a result of growth in earning assets volumes and improved yield during the period under review.

Average volumes was up by 21.3per cent from increased funding; similarly, earning asset yields improved to 9.93per cent in H1 2023 from 8.01per cent in H1 2022.

The growth in interest income was further supported by the 385.0per cent growth recorded on non-funded income to N446.7billion in H1 2023 from N92.1billion in H1 2022.

The key driver for the 84per cent increase in interest expense to N48.5billion in H1 2023 from  N26.4billion reported in H1 2022 was the 150basis points and 70basis points pick up in in the cost of savings account and time deposits on the back of adjustment to Monetary Policy Rate (MPR) to which interest paid on savings account is indexed; 18.75per cent in H1 2023 as against 16.5per cent in December 2022.

This brings GTCO’s net interest income to N177.5billion in H1 2023, an increase of 47 per cent from N120.8billion in H1 2022.

The Group booked loan impairment charges of N82.96billion in H1 2023 from N3.51billion in H1 2022 due to weakening macroeconomic variables driving the predictive EC model and caused management overlay on stage 2 facilities as permitted under IFRS 9 in line with its conservative posture of building up credit risk reserves to deal with adverse situations.

In the period under review, GTCO declared N125.6billion total operating expenses, an increase of 26.2 per cent or N26.1billion from N99.5billion in H1 2022, primarily from an increase in AMCON levy and NDIC premium.

Other contributory factors to operating expenses growth include, incremental depreciation charge arising from capital spend, rise in inflation to 22.8per cent in H1 2023 after hovering between 17per cent-18.6per cent for most parts of H1 2022, effect of increased energy costs, impact of salary reviews and impact of adverse exchange rate movement of functional currencies against the US Dollar across our jurisdiction of operations outside Nigeria in H1 2023.

Overall, the Group leveraged synergies created through the Holding Company structure, robust foreign exchange liquidity, structure of its balance sheet which produced huge gains from devaluation of the Naira, efficient capital planning and a wellcrafted and executed retail strategy to post 217per cent increase in profit before tax to N327.4billion in H1 2023 from N103.2billion in H1 2022 with Nigerian operations accounting for 84.7per cent, West Africa – 11.75per cent, East Africa – 1.6 per cent, UK – 1.5 per cent and Non-Banking Entities – 0.8 per cent.

With N46.92billion tax income, GTCO closed H1 2023 with N280.48billion profit after tax, an increase of 262 per cent from N77.56billion reported in H1 2022.

For the first time in the history of the bank, an interim dividend of N0.50 per share is declared on the issued capital of 29,431,179,224 ordinary shares of 50 Kobo each payable to shareholders.

The group, however, closed H1 2023 with N 9.94 Earning Per Share (EPS) from N2.70 EPS reported in H1 2022.

Stronger deposit, loans boost total assets

The Group posted growth across all asset lines and continues to maintain a well-structured and diversified balance sheet across all jurisdictions wherein it operates a Banking franchise, as well as across its Payments, Pension and Funds Management business verticals; closing H1 2023 with total assets of N8.5trrillion representing a 32.0per cent growth over N6.45trillion recorded in 2022 financial year.

GTBank Ltd, which constitutes 74per cent of Group balance sheet, recorded huge gains from its foreign currency asset mix of  39per cent (34% pre-devaluation), benefitting from the recent exchange rate unification instituted by the Central

Bank of Nigeria (CBN) (the move to a market determined clearing rate led to a 66.7per cent devaluation of the Naira to dollar at the Investors & Exporters (I&E) Window.

Growth in earning assets of 46 per cent in H1 2023 from N3.8trillion in 2022 is underpinned by growth in deposit liabilities which grew 39 per cent y-o-y (16per cent in real terms). The synergy created by the Holding Company structure remains a key driver of increased inflow of deposit liabilities.

The Group continued to adopt a cautious approach to loan growth in view of unfavourable macro economic indicators. The 23% (2% in real terms) growth in net loans to N2.3trillion in H1 2023 from N1.89trillion in 2022 is essentially from currency depreciation recorded in the books of GTBank Ltd.

The Group was able to improve its foreign currency loan mix to 55per cent:45 per cent from 53 per cent:47 per cent as strategies implemented to hedge against currency depreciation paid off.

Customer deposit liabilities grew by 39 per cent, from N4.49trillion in 2022 to N6.238trillion in H1 2023 as low-cost funds grew by 43.8per cent from N3.991trillion in 2022 to N5.74trillion in H1 2023 resulting in low-cost deposit mix of 92per cent from 88per cent in FY 2022.

The Group remains focused on flawless execution of its Retail strategy and this continues to enhance the Group’s capability to attract low cost deposits and reduce reliance on Tenured deposit which grew marginally by 1.2per cent to N499.1billion.

H1 2023 was very defining as individuals, households, and businesses faced daunting challenges wit attendant negative impact on operating performance, however, in-spite of unfavourable macros, the Group was able to ride the tide posting pre-tax Return on Average Assets of 8.8per cent and pre-tax Return on Average Equity of 61.4per cent.

Strong capital ratios

The Group continued to maintain strong capital positions with Full IFRS 9 impact Capital Adequacy Ratio (CAR) of 24.7per cent (Bank:20.4per cent); 970basis points above the regulatory minimum of 15per cent and 870basis points over if adjusted for one per cent loss absorbency ratio.

Tier 1 capital remained a very significant component of the Group’s CAR closing at 22.72per cent representing 91.9per cent of the Group’s CAR of 24.7per cent.

The robust capital position provides the Group the needed headroom required for future expansion and risk-taking. The Group’s capital has also been sensitized for Basel III compliance at three levels of Naira devaluation: N750, N850 and N900/$1 and found robust enough to meet the requirements of additional capital buffers – conservation and counter-cyclical under Basel III and impact of the expect growth in the value of the FCY Risk-weighted Assets of the group balance sheet.

Liquidity ratio of the group closed at 37.5per cent in H1 2023 down from 38.9per cent in H1 2022 and 49.9per cent in  2022FY but well above the regulatory minimum requirement of 30per cent.


The Group Chief Executive Officer of Guaranty Trust Holding Company Plc, Mr. Segun Agbaje, stated that the H1 2023 audited results reflect the strong business fundamentals underpinning the GTCO franchise, the quality of its past decisions in future proofing balance sheet for challenging times, and the sound practices that guide day-to-day operations.

According to him, “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 a solid performance across key metrics reflect efficiencies and justify the investments we continue to make in technology, product development, and our people.”

He added that, “We recognise 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 optimise stakeholder value.”

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