…The earnings contraction was largely driven by the normalisation of fair value gains and dilution from the issuance of 5.17 billion additional shares.
WED APRIL 01 2026-theGBJournal| Guaranty Trust Holding Company Plc (GTCO) released its audited FY’25 results, reporting a 28.2% year-on-year decline in earnings per share (EPS) to N25.43, down from N35.44 in FY’24.
The earnings contraction was largely driven by the normalisation of fair value gains and dilution from the issuance of 5.17 billion additional shares.
Despite this, the Board proposed a final dividend of N11.76 per share, translating to a compelling dividend yield of 10.4% based on the last closing price of N112.65.
Interest income remained robust, rising 23.2% y/y to N1.65 trillion, supported by strong growth across investment securities, customer loans, and cash balances.
This performance was underpinned by a 21.7% expansion in earning assets, particularly from investment securities and loan book growth.
However, funding costs increased sharply by 38.6% y/y to N392.58 billion, driven primarily by higher costs on customer deposits, even as deposits grew 24.4% to N12.46 trillion.
Net interest income still advanced by 19.1% y/y to N1.26 trillion, aided by a significant decline in provisioning costs.
Non-interest income declined markedly by 31.5% y/y to N512.29 billion, posing a major drag on overall profitability.
While loan recoveries surged and fee income grew strongly, these gains were overshadowed by an N81.79 billion fair value loss compared to a substantial gain in the prior year.
FX revaluation gains provided some support but were insufficient to offset the prior year’s windfall. Consequently, operating income grew marginally by 2.2% y/y to NGN1.71 trillion.
Operating expenses rose by 17.9% y/y to N475.37 billion, driven by higher depreciation, AMCON levy, and personnel costs.
This led to a deterioration in the cost-to-income ratio to 26.8%, although it remains the lowest among tier-1 banks.
Pre-tax profit declined slightly by 2.8% y/y to N1.23 trillion, but a higher effective tax rate of 29.7% significantly weighed on bottom-line performance. As a result, profit after tax fell by 14.9% y/y to N865.75 billion.
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