GTBank Fortifies Balance Sheet to Withstand Shocks – The fall of the Nigerian economy into a recession did not come to many as a surprise because it was expected but it gave some smart thinking organisations the time to plan ahead.
Last Saturday, the National Bureau of Statistics (NBS) announced what many observers were expecting and due to another contraction in the gross domestic product (GDP) in the third quarter by 3.63 per cent after a 6.10 per cent decline in the preceding quarter, the largest economy in Africa officially entered a recession, the second under President Muhammadu Buhari as a civilian leader.
A year after he was sworn-in as President in 2015, the country entered a recession and though he made efforts to avoid the second, his hands were tied as the COVID-19 pandemic and decline in crude oil prices led the country to the worst economic crisis in over three decades.
It is no doubt that during this period, while the nation tries to find its way out of the crisis, the pressure will be on financial institutions and for Guaranty Trust Bank (GTBank) Plc, it has prepared well for this.
Last week, the lender released its unaudited financial results for the period ended September 30, 2020, to the Nigerian and London Stock Exchanges.
An analysis of the Q3 results showed improved performance across key financial metrics, reaffirming the bank’s capability to navigate the current economic challenges occasioned by the impact of COVID 19 on world economies.
The performance also reflected its position as one of the leading and best managed financial institutions in Africa, reporting a profit before tax of N167.4 billion, representing a decrease of 1.9 per cent over N170.7 billion recorded in the corresponding period of September 2019 and an improvement on the 5.2 per cent dip posted in H1-2020 relative to H1-2019.
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Loan and deposit book, however, grew by 4.5 per cent and 25.1 per cent from N1.502 trillion and N2.640 trillion recorded as of December 2019 to N1.569 trillion and N3.303 trillion in September 2020 respectively.
This medium keenly observed that the company’s balance sheet remained well structured, diversified and resilient with total assets and shareholders’ funds closing at N4.574 trillion and N755.5 billion respectively, with deposits from customers growing to N3.2 trillion from N2.5 trillion in December 2019.
Full Impact Capital Adequacy Ratio (CAR) remained very strong, closing at 23.9 per cent, while asset quality was sustained as NPL ratio and Cost of Risk (COR) closed at 6.5 per cent and 0.6 per cent in September 2020 from 6.5 per cent and 0.3 per cent in December 2019 respectively.
In the views of the MD/CEO of GTBank, Mr Segun Agbaje, “Our third quarter result is a reflection of how we have appropriately positioned our balance sheet to cope with current economic realities and the challenging business environment.”
“It is also a testament to the enduring loyalty of our customers, the hard work and dedication of our staff and the unwavering support we continue to enjoy from all our stakeholders in our drive to deliver best-in-class financial services and superior and sustainable returns,” he added.
He assured that; “As an organisation, we will continue to build on our commitment to enriching lives by leveraging our digital-first customer-centric strategy to improve customer experience and maintain a high standard in service delivery and going beyond banking to create and drive innovative financial solutions that add value to our customers in all aspects of their lives.”
Overall, GTBank continues to be the best in the Nigerian banking industry in terms of all financial ratios i.e. Post-Tax Return on Equity (ROAE) of 26.3 per cent, Post-Tax Return on Assets (ROAA) of 4.6 per cent and Cost to Income ratio of 40.2 per cent.
Renowned for its forward-thinking approach to financial services and customer engagement, GTBank was recently ranked Africa’s Most Admired Finance Brand in the 10th-anniversary rankings of Brand Africa 100: Africa’s Best Brands, the pre-eminent survey and ranking of the Top 100 admired brands in Africa.
It was also awarded the Best Bank in Nigeria by Euromoney Magazine for a record-extending 10th time and the Euromoney Excellence in Leadership Africa Award for its swift reaction in responding to the COVID-19 crisis and for addressing the impact of the pandemic on its customers and communities.