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GTCO’s Profit Before Tax Grew by 182% to N1.22trn in Nine Months

Guaranty Trust Holding Company Plc (GTCO) has announced its nine months ended September 2024 unaudited result and accounts with about N1.22 trillion profit before tax, about 182 per cent increase from N433.2 billion reported in nine months of 2023.

The lender’s profit after tax grew faster by 195.3per cent to N1.09 trillion in nine months of 2023, after accounting for the N134.46 billion income tax expense.

In nine months of 2024, GTCO reported a 161.7 per cent growth in interest income to N980.34 billion, driven by the impressive income from key contributory lines. In nominal terms, the group generated higher revenue from investment securities (+270.6per cent to N416.95 billion) and loans and advances to customers (+84.8 percent to N392.33 billion), which was sufficient to offset the decline in income from placements with other banks (-89.3per cent).

Elsewhere, interest expense surged by 158.2per cent  to N198.86 billion, triggered majorly by the elevated interest rate environment leading to increased funding costs.

Consequently, the net interest income rose by 162.6per cent to N781.48 billion. Eventually, the net interest income (ex-LLE) settled 245per cent higher at N717.92 billion, following the decline in loan impairment charges (-29per cent  to N63.56 billion) in the period.

Non-interest income (NII) grew by 95 percent to N796.22 billion, spurred primarily by the fair value gains on financial instruments (+116.1per cent to N523.22 billion).

Further down, GTCO’s operating expenses grew by 61.3per cent  to N294.68 billion, with pressure stemming from personnel expenses (+90.3per cent to N71.53 billion), technological costs (+85.7percent  to N39.35 billion), and AMCON levy (+33.6per cent to N36.66 billion).

Nonetheless, the group maintained impressive operational efficiency as the cost-to-income ratio (ex-LLE) settled at 19.5per cent (nine months of 2023: 29.7per cent).

According to analysts at Cordros Research, GTCO continues to deliver impressive results in line with our expectations, driven by the high-interest rate environment and the group’s operational efficiency.

“Just as in H1 2024, GTCO delivered lower loan impairment charges (-29per cent) despite the challenging macro space, sealing the group’s position as the most efficient lender in Nigeria.

“We expect GTCO to close the year positively, supported by consistent growth across the group’s core and non-core income lines and an effective cost management strategy.”

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