GTCO’s annual profit falls despite revenue hitting record N539 billion

Guaranty Trust Holding Company (GTCO) recorded its peak revenue ever in 2022 as surges in lending rates across the banking industry during the year impacted interest income and spikes were reported across all of the income sources of the financial services group.

But the rise in the top line did not lift profit as earnings took a battering from cost pressures amid record inflation in Africa’s largest economy.

Gross earnings leapt 20.4 per cent to N539.2 billion mainly on account of improved interest income, according to the lender’s audited earnings report issued on Friday.

Net interest income grew to N259.3 billion, jumping 17.5 per cent from the figure reported a year earlier.

The group put N12 billion aside to cover potential defaults from borrowers, which was 40.5 per cent higher than the figure reported a year earlier.

At N77.5 billion, net fee and commission rose by 18 per cent, driven by improvement in e-business income and account maintenance charges.

Other income climbed to N82.9 billion from N77.1 billion, boosted by higher foreign exchange revaluation gain.

The bulk of cost pressure resulted from a jump in other operating expenses, which advanced by more than one-third to N126.4 billion on the back of increased communications and technologically related expenses and administrative expenses.

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GTCO incurred N35.9 billion in net impairment charge on other financial assets, which compares with N760.8 million a year prior.

Pre-tax profit slightly declined by 3.3 per cent to N214.2 billion, while profit for the year slid to N169.2 billion from N174.8 billion.

The board has proposed a final dividend per share of N2.70, having paid an interim dividend of N0.30 during 2022. That translates to a planned payout of N88.3 billion.