GTCO declares 50.4% drop in profit to N449.01bn

Guaranty Trust Holding Company Plc (GTCO) on Tuesday published its half year ended Junne 30, 2025 financial results, reporting a 50.4per cent drop in profit after tax to N449.01 billion as against N905.57 billion in H1 2024.

The weak earnings performance was weighed by the steep decline in non-interest income and higher operating costs, undermining the 31.5per cent core earnings growth.

Amid decline in profit, the board proposed an interim dividend of N1.00/s for the second consecutive period, representing a dividend yield of 1.1per cent based on the last closing price of N93.00/s.

The group recorded a 31.5 per cent increase in interest income to N812.36 billion, supported by stronger contributions from investment securities (+43.6 per cent to N382.87 billion), loans to customers (+22.8 per cent to N297.49 billion), and cash and balances with banks (+22.6 per cent to N129.86 billion).

Interest expenses rose by 42.5 per cent to N180.12 billion, reflecting higher costs on customer deposits (+44.2 per cent) and borrowings (+39.2 per cent).

Nonetheless, net interest income ex-LLE grew by 38.6per cent to N615.37 billion, aided by lower net impairment charges (-64.4per cent to N16.87 billion).

Elsewhere, non-interest income declined sharply (-68per cent to N244.02 billion).

This was driven by the fair value loss of N4.44 billion compared to the gain of N493.02 billion recorded in the prior period.

The preceding offset gains from fees and commissions (+33.7per cent to N135.17 billion) and securities trading (+106.6per cent to N10.42 billion), resulting in a 28.7per cent contraction in operating income to N859.39 billion.

Operating expenses increased by 27.9per cent to N258.49 billion, driven by higher personnel expenses (+31.1per cent), AMCON levy (+38.7per cent), and depreciation (+39.1per cent). As a result, the cost-to-income ratio deteriorated to 30.1per cent (H1-24: 16.8perr cent).

Analysts at Cordros Research said, “GTCO’s H1 2025 results reflect the impact of naira stability, which curtailed fair value gains and weighed on non-core income. Nonetheless, the group delivered resilient performance in its core banking operations, supported by the high-yield environment.

“Looking ahead, elevated interest rates and growth in earning assets are expected to remain supportive, although rising cost pressures and weaker non-interest income present downside risks. Our estimates are under review.”