Business Hilights
Tracking Nigeria's Headline Business News Online

Agbaje gives details on why GTBank outlook for 2018 remains strong, progressive

The Managing Director of Guaranty Trust Bank Plc, Mr. Segun Agbaje,  weekend provided insights on the financial results of the bank recently released at the Nigerian Stock Exchange, saying the 2018 financial year would be a much better for the bank.

He said the bank will ride on the planned efficient capital allocation to business segments with low risk and optimal returns to complement the effective balance sheet management.

This business idea will deepen the resultant strong earnings as evidenced by impressive ROAE; ROAA, NIMS, capital returns and improved capital buffers posted by the Group as at December 31, 2017.

According to him, GTBank posted positive performance across all financial indices, despite the harsh and challenging business environment.

Agbaje averred that “given the current state of the economy, 2018 was going to be a tough year for the sector generally, but however expressed strong optimism that the bank would work hard to maintain profitability”.

While noting that the bank would tread carefully because “the growth is still very slow and the monetary policy is still tight,” the managing director observed that explained that NLPs would moderate to 4.6 per cent, below regulatory threshold, if the 9mobile loan was excluded from NPL ratio computation.

The bank in a recent notification to the Nigerian Stock Exchange (NSE), said its board of directors would meet on April 18, 2018 to consider its financial statements.

Business Hilights recalls that the bank’s audited results for 2017 showed that gross earnings for the year rose by 1.1 per cent to N419.2billion from N414.6billion reported in December 2016.

The growth was driven by the rise in interest income and revenues from e-payment. Profit before tax stood at N200.2billion, representing a growth of 21.3 per cent over N165.1billion recorded in the 2016 financial year.

GTBank’s loan book had dipped by 8.9 per cent from N1.590trillion in December 2016 to N1.449trillion in December 2017 while customer deposits increased by 3.8 per cent to N2.062trillion from N1.986trillion in December 2016.

Within the period under review, Agbaje revelaed further that the loan book contracted by 8.9 per cent “due to the cautious effort to de-risk the balance sheet, repayment of US dollar term loans and unwinding of US dollar trade obligations.”

Just as he explained that the US dollar repayments led to increased dollar liquidity, which contributed to 41 per cent growth in cash and cash equivalents from N455billion in 2016 to N641billion in 2017.

Currently, GTBank’s total assets stood at 3.9 per cent, while shareholders’ funds rose to ₦625.2billion. In terms of assets quality, non-performing loan ratio (NPL) grew to 7.7 per cent in December 2017 from 3.7 per cent in 2016 financial year.

The reason provided by the financial institution is that it was largely as a result of classification of a single exposure within the Nigerian Telecommunications Industry, especially the 9mobile syndicated loan default crisis.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More