The board of Guaranty Trust Holding Company, on Thursday, presented its audited report for the half-year ended June 30, 2021, with gross earnings of N205.551bn, against the previous N223.039bn, which the group described as “a decent performance across key financial metrics against the challenging business environment.”
The result, it continued, reaffirms the group’s “ability to cope effectively in depressed times, and as one of the most profitable and well managed financial institutions in Nigeria.”
Profit after tax dropped from N92.17bn to N77.05bn, translating to Earnings Per Share of N2.79, compared to the previous N3.32 each from which the directors have offered an interim dividend of 30 kobo per share, just like in the corresponding period of 2020. The dividend is payable to those whose names appear on the register of shareholders and its Global Depository Receipts at the close of business on September 16, while the dividend is payable electronically on Monday, October 12, 2021.
GTCO attributed the profit dip to the present realities of the operating environment, although “Full Impact Capital Adequacy Ratio (CAR) remained very strong, closing at 24.0%, while Asset quality was sustained as NPL ratio and Cost of Risk (COR) closed at 6.0% based on IFRS (6.8% based on CBN Prudential Guidelines) and 0.27% in June 2021 to 6.4% and 1.18% in December 2020, respectively.”
The group reported interest income for the period of N126.09bn, compared to the N153.708bn, of which N92.236bn was earned within Nigeria, compared to N125.658bn; and N33.854bn, while N28.049bn was derived from outside the country. Interest expense dropped from N26.093bn to N19.035bn, resulting in net interest income of N107.055bn from N127.615bn. Loan impairment charges reduced to N4.714bn from N6.769bn; as net interest income after loan impairment charges stood at N102.34bn from N120.846bn.
Fee and commission income increased by 44.7% from N26.457bn to N38.284bn, boosted by the N10.497bn from electronic business income which rose from N6.564bn; followed by the N7.802bn from account maintenance charges, which increased from N5.54bn; and expense dropped to N1.428bn from N2.435bn; resulting in a net income of N36.855bn. Net gains on financial instruments held at fair value through profit or loss were flat at N10.43bn from N10.791bn; other income stood at N33.109bn from N34.181bn, lifted by discounts and recoverables (FX) of N15.6bn, up from N5.227bn, including the sum of N3.583bn, representing a non-vatable portion of digital earnings; in addition to the sum of N2.265bn recoveries from N3.3bn being recoveries from Loans facilities previously written off totaling N7.151bn. Net impairment charge on other financial assets stood at N341.707m from a reversal of N3.18bn. Personnel expenses stayed flat at N17.234bn, against N17.449bn in the first half of 2020. Other operating expenses rose to N54.34bn from N50.875bn, driven mainly by the N21.888bn doled out6 as AMCON expenses, up from N17.2bn in 2020; as profit before tax stood at N93.056bn from N109.713bn. Income tax expense dropped to N13.641bn from N15.442bn.
Total assets for the period improved from N4.944tr to N5.017tr, of which customer loans and advances amounted to N1.632tr, compared to the previous N1.662tr, Total liabilities increased to N4.219tr from N4.13tr, helped by customer deposits of N3.625tr from N3.509tr.
The statement quoted Segun Agbaje, Group Chief Executive Officer of GTCO as saying the results reflect the group’s “commitment to building on our track record of solid financial performance, and our capability to constantly innovate will ensure we stay ahead of the curve at all times. We are counting on the enduring support of our loyal customers and the hard work of our dedicated staff to continually make end-to-end financial services easily accessible to everyone and to create the best outcomes for all our customers and the communities in which we operate.
“Looking forward, we are focused on bringing to bear the full benefits of our new corporate structure by consolidating our leading position in all the economies where our franchise operates. We will also diversify our earnings from core banking, continue to empower businesses across Africa and beyond, and generate long-term returns for our shareholders,” he stressed further.
