September 15, (THEWILL) – Guaranty Trust Holding Company (GTCO) Plc is racing for a N20 trillion assets mark to consolidate grip on industry leadership ahead of the recapitalization exercise. The Group’s audited half year (HY 2024) financial statements presented to the Nigerian Exchange on Wednesday, September 11, point to this direction.
The spruced up margins achieved by the Group showed in the impressive topline and bottom line growth which contributed to total assets soaring by 49.7 percent to N14.51 trillion, from N9.69 trillion as of December 31, 2023.
The healthy balance sheet position also mirrored through the expansion of loans and advances to customers from N2.48 trillion in HY 2023 to N3.1 trillion during the first six months of the year, showing a 25.4 percent rise. This is indicative of the Group’s diligent support to the economy despite prevailing headwinds. From this, it reaped a handsome net interest income of N491.55 billion in the first six months of the year against N177.45 billion recorded in HY 2023, constituting a 177 percent increase.
According to the audited financial results for HY 2024, this impressive performance reflected in the three-digit growth in gross earnings which surged by 107 percent to N1.39 trillion from N672,6 billion in the corresponding period of 2023.
The increase in gross earnings is largely due to growth in interest and non-interest income. The aggressive loan book expansion resulted in the increase in interest income to N607.69 billion against N214.45 billion in HY 2023 representing a jump of 183.37 percent.
The Group’s net interest income after loan impairment charges was equally in the positive trajectory rising by 370 percent to N444.1 billion from N94.49 billion in the equivalent period of the preceding year.
Similarly, non-interest income achieved a remarkable growth during the period on the back of fee and commission income which achieved a 95 percent growth to N113.91 billion against N58.41 billion in HY 2023.
This is driven largely by e-banking income which jumped to N32.50 billion from N21.21 billion in the previous year’s first six months resulting to a growth of 53.3 percent during the review period. This followed the bank’s pursuit of service excellence through its e-banking platforms amid intense industry competition.
Seeing the neck-break competition among industry peers, the Group accelerated its electronic transaction windows, such as the GT World and GT e-Tokin.
The move contributed to the remarkable improvement in earnings per share which shot from N9.94 to N32.12 representing a remarkable 263.3 percent growth.
THEWILL reports that GTCO recorded a substantial Profit Before Tax (PBT) of N1 trillion in the first six months of the year. The impressive half-year performance followed the record N494.5 billion posted in the second quarter (Q2) which is the highest in the Group’s history.
The figure also represents the best second-quarter results so far reported by any Nigerian financial holding company or bank following the blazing N509.3 billion PBT posted by the Group in Q1 2024.
Profit After Tax (PAT) for HY 2024 rose to N905.56 billion from N280.48 billion – a 222.86 percent growth.
“The Group’s impressive results in HY 2024 will strengthen the performance towards achieving the target N400.5 billion set in the public offer programme. This will expand the balance sheet as the financial services institution pursues the recapitalization goal,” said Clement Ulasi, a stock broker.
Ulasi added that a strong balance sheet is sine qua non for operating in the league of top financial service establishments that would emerge at the end of the recapitalization process.
Commenting on the significance of strong assets quality, Professor of Finance and Accounts at the Nasarawa State University, Keffi, Muhammad Mainoma, had told THEWILL that strong asset base is strategic to the development of any business because an enterprise is handicapped if it trades with a lean balance sheet.
“Strong asset base signifies that a business is strategically positioned to take advantage of its environment. For a bank, there is no time that people will not need money. Once a business is focused and invests in areas that people always need, it will not lose. This explains the continuous growth (in assets) despite the difficult operating environment,” Mainoma, former President, Association of National Accountants of Nigeria (ANAN), said.
GTCO recently concluded its public offer engagement meant to raise N400.5 billion to boost its capital base towards meeting the April 2026 deadline.
Commenting on the launch of the Public Offer in July, the Group Chief Executive Officer of Guaranty Trust Holding Company Plc, Segun Agbaje, said: “This equity capital raise is timely and marks a significant milestone in our strategic plan to pivot the organisation for transformational growth across the Banking businesses in and outside Nigeria, and the non-banking businesses; differentiating it as a leading Financial Services Group in Africa.”
“Over the last three years, we have diversified the earnings of the Group beyond pure banking play, through the creation of a Payments subsidiary and selective acquisitions in the Funds Management and Pension Fund Administration sectors; delivering exceptional value to our stakeholders whilst also enriching the lives of people in every community where we operate”.
GTCO is the most capitalised Banking stock on the Nigerian Stock Exchange and has consistently outperformed its peers in terms of key profitability indicators and other financial metrics.
Widely regarded as a first-rate financial institution, GTCO’s leadership in the Nigerian financial services industry and continuing efforts at empowering people and communities across Africa has earned it many prestigious awards over the years.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
