Nigeria’s foremost financial institution, Guaranty Trust Holding Company Plc, increased the prospect of distributing improved dividends to its shareholders at the end of the 2024 financial year, as it recorded a whopping 696.1 percent year-on-year rise in earnings per share.
EPS stood at N16.24 in the first quarter period ended March 31, 2024 as against N2.04 posted in the corresponding period of 2023.
The impressive growth in the Holdco’s earnings was driven primarily by the fair value gain on the group’s financial instruments which stood at N331.55 billion up from a loss of N99.00 million in a similar period of 2023 coupled with expansion in its funded income line which grew by 170.6 percent y/y.
Interest income advanced by 170.6 percent y/y to N281.65 billion, boosted by higher income from loans and advances to customers by 91.0 percent y/y, investment securities rose by 307.5 percent y/y and cash and balances with banks grew by 265.9 percent y/y. analysis of the Holdco’s earning asset show 104.3 percent increase year-to-date (YTD) to N10.18 trillion as the high-yielding environment also supported growth in core income.
Sequentially, interest expense rose by 147.9 percent y/y to N54.35 billion, primarily driven by the higher interest paid on customer deposits which grew by 141.0 percent y/y as the group’s deposits surged to N9.20 trillion, translating to 87.3 percent growth YTD.
GTCO witnessed a remarkable 666.4 percent y/y increase in its non-interest income to N394.86 billion, majorly driven by the N331.55 billion fair value gain recorded for the Holdco’s financial instruments.
Operating expenses (OPEX) grew by 76.9 percent y/y to N99.33 billion following the higher personnel expenses up by 114.4 percent y/y and regulatory fees – AMCON levy up by 33.7 percent y/y and deposit insurance premium up by 48.5 percent y/y. Given that operating income rose by 367.4 percent y/y which is faster than OPEX, the group’s operational efficiency improved significantly as its cost-to-income ratio (ex-LLE) settled at 16.3 percent as against 43.1 percent posted in Q1, 2023.
GTCO’s profitability was stronger, with profit-before-tax settling 587.5 percent higher year-on-year to N509.35 billion. After accounting for a higher income tax charge of N52.21 billion representing 227.9 percent y/y increase, while PAT settled at N457.13 billion amounting to 685.9 percent rise y/y.
