Guaranty Trust Holdings Plc, the parent company of Guaranty Trust Bank Limited, has set an unusual record at half year 2024 as it declared a profit after tax of N905.6 billion for the period ended 30 June 2024. The financial juggernaut followed others in the industry that benefited from the rising interest rate, occasioned by the hawkish stance of the Central Bank of Nigeria (CBN), and the devaluation of the naira which boosted gains from currency revaluation.
GT Holdings raked in N1.39 trillion as revenue in the first six months of this year, an increase of 107 percent over N672.60 billion made in the first six months of 2023. Interest income for the period was N607.70 billion, reflecting the higher interest rate regime in the country, compared to N214.45 billion in the same period in 2023.
Net interest income for the period was N491.51 billion. This amounted to an increase of 177 percent over N177.46 billion which the company made in the first six months of 2023.
The interest income was generated from loans and advances to customers, cash and cash equivalents, and investment in securities. By geographical location, N361.95 billion was generated from loans and advances given to customers in Nigeria, while N255.94 billion was generated as interest income on loans and advances given to customers outside the country.
Net fee and commission income was N101.07 billion in the first half of this year. In the corresponding period of 2023, the financial group generated N51.55 billion as net fee and commission income. The income came primarily from e-business income, commission on foreign exchange deals, account services, maintenance and ancillary banking charges, account maintenance charges, credit related to fees and commission, among others.
Another N630.27 billion titled as “other income”, boosted GT Holdings earnings during the half year of 2024. This came from N493.02 billion from unrealised fair value gain on financial instruments, and unrealised gain on forward transactions of N130.21 billion as well as revenue from other sources.
Profit before tax rose a record 206.6 percent to N1.003 trillion as of June 2024, up from N327.39 billion as of June 2023. GT Holdings paid a tax of N98.21 billion during the period, compared to N46.92 billion in the corresponding period of 2023.
In line with the mandate of the CBN, GT Holdings was in the market in July to raise additional funding through an offer for subscription of 9 billion ordinary shares of 50 kobo each at N44.50 per share.
It should be recalled that late 2023, the Federal Government made moves to levy banks in the country a windfall tax to recoup part of the huge earnings they made from the naira devaluation.
Writing on its X hand, Bayo Onanuga, Special Adviser Information and Strategy to President Tinubu, quoted the billionaire investor, Femi Otedola as supporting the move by the FG.
“Nigerian banks are spending an estimated $50 million annually just on maintaining private jets, with over $500 million gone into purchasing nine private jets by four banks. This level of extravagance significantly erodes public trust in our financial institutions and diverts crucial resources away from vital areas,” Otedola said.
“Taxing these extraordinary gains ensures a fairer distribution of wealth, allowing those who benefit disproportionately to contribute more significantly to the broader societal good,” Otedola added.
“The revenue generated from windfall taxes can be channelled into essential public services such as health care, education, and infrastructure,” he said.
GT Holdings has proposed an interim dividend of N1 per share for shareholders whose names are present in the register of the company on or before September 25, 2024 for ordinary shareholders, and September 16, 2024 for holders of Global Depository Receipts (GDRs). Payment date is October 7, 2024.
