Guaranty Trust Holding Company Plc (GTCO), the parent company of Guaranty Trust Bank, has reported a 40.13 per cent decline in profit before tax (PBT) for the first six months of the year.
The Group’s audited financial statements for the six months ended June 30, 2025, released on Tuesday, September 23, show the pre-tax profit declined to N600.9 billion in June 2025 from N1.003 trillion reported in June 2024.
Pinnacle Daily’s review of the report shows that the decrease in GTCO’s profit resulted from a sharp drop in its other income line item, which dropped by 88.75 per cent to N70.92 billion in June 2025 from N630.27 billion in June 2024.
The items comprise transactions, including trading investments, foreign exchange revaluation, financial instruments, forward transactions, gain on disposal of fixed assets, and dividend income.
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An analysis of the other income line item revealed that GTCO reported a significant loss of N4.36 billion on financial instruments in the review period from N493.02 billion gained in the same period last year.
This subsequently impacted its bottom-line profit, known as profit after tax or profit for the period, which dropped by 50.42 per cent to N449.01 billion from N905.57 billion in the corresponding period of 2024.
The decline was evident despite GTCO maintaining gross earnings of N1.07 trillion, lower than N1.39 trillion in June 2024.
A breakdown of its top-line performances shows that net interest income grew by 28.63 per cent to N632.24 billion, while net interest income after loan impairment charges grew by 29.98 per cent to N577.27 billion.
A cursory look at the company’s interest income revealed that GTCO relied significantly on interest income securities investments, accounting for over 35 per cent of gross earnings, surpassing the 27 per cent contribution from loans and advances.
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Its interest income from loans and advances grew by 22.15 per cent to N299.63 billion from N245.3 billion. Still, income from investments in securities expanded faster by 44.46 per cent to N374.99 billion from N259.57 billion, signifying that GTCO probably relied more on fixed-income securities for earnings rather than traditional loan growth.
Despite the drop in its earnings and financial performance, the company has approved an interim dividend of N1.00 per share.
The dividend will be paid to shareholders whose names appear in the Register of Members as of October 7, 2025, the company announced in a separate statement on Tuesday.
Agusto & Co.’s projection of banks’ profit
In its ‘2025 Nigerian Banking Industry Report’, released in August, Agusto & Co. Limited, a pan-African credit rating agency, has projected that relative to 2023 and 2024 financial performances, banks are likely to see a decline in their profit margins this year by about 19.2 per cent.
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It expects forbearance loans to drive a surge in the impairment charge as banks decide to write off some impaired loans as part of the transitional relief measure.
“In addition, we anticipate lower foreign currency revaluation gains that have bolstered profitability since FY 2023.
“Overall, we expect a 19.2% decline in profit before taxation with the pre-tax return on average equity plummeting to 27.3% (FY 2024: 48.2%) in FY 2025,” Agusto & Co. stated.
It said, however, that the banking industry’s profitability is expected to rebound in 2026 as the proceeds of the capital raising activities are fully deployed and the impact of the uptick in the impairment charge is moderated.
Pinnacle Daily reported earlier that Zenith Bank Plc posted a decline in profit after tax to ₦532.18 billion for the first six months of the year, compared to ₦577.997 billion it recorded in the same period in 2024.
United Bank for Africa (UBA) Plc also reported a drop in profit before tax to ₦388 billion in June 2025 from ₦401 billion in the same period of 2024.
Alex is a business journalist cum data enthusiast with the Pinnacle Daily. He can be reached via ealex@thepinnacleng.com, @ehime_alex on X
