April 18, 2019/InvestmentOne report
- Net interest income of N58.2billion, up 12.4% q/q; down 2.5% y/y
- Non-interest income of N35.3billion, up 23.3% q/q, up 28.5% y/y
- Profit before tax of N57.0billion, up 9.6% q/q; up 8.3% y/y
- Profit after tax of N49.3billion, up 14.5% q/q; up 10.4 y/y
GT Bank released its Q1 2019 to the NSE yesterday, where it reported a 12.4% q/q (-2.5% y/y) rise in net interest income to N58.2billion. However, unlike Zenith, it reported a 23.3% q/q (28.5% y/y) rise in non-interest income. Similar to Access and Zenith, it also reported a drop in impairment charges (79.1% q/q & 60.3% y/y) to N651million. Consequently, PBT and PAT rose 9.6% and 14.5% q/q to c.N57.0billion and N49.3billion respectively.
Similar to Zenith Bank, GT’s net loans were somewhat flat q/q but down 5.0% y/y. This, combined with the lower interest rate environment in Q1 2019 relative to Q1 2018, seemed to have weighed in on interest income which was down 7.8% y/y. Net Interest Margin (NIM) was down 19bps y/y to 9.9%.
The bank also reaped the benefits of a growing customer base (up 6.0% q/q), as fee and commission income rose 54.0% q/q and 22.0% y/y. This, combined with some recoveries of c.N6.1billion contributed to the 23.3% q/q and 28.5% y/y growth in non-interest income.
Impairment charges dropped 79.1% q/q hence, Cost of Risk declined to 0.05% from 0.34% in FY 2018. NPL ratio moderated 27bps q/q to 7.03%.
In conclusion, GTB continues to dominate its peers, with ROE of 32.8% and CAR of 22.3%. The bank’s Cost-to-income ratio inched up slightly to 38,6% but still compare favorably to Zenith’s and Access’ of 50.0% and 53.2% respectively.
GUARANTY TRUST BANK PLC Q1 2019 (YE: DEC) (N millions) | ||||
Q1 2019 | Q/Q
| Y/Y
| ||
Interest Income | 74,484 | 7.3%
| -7.8%
| |
Interest Expense | -16,267 | -7.7%
| -22.8%
| |
Net Interest Income | 58,217 | 12.4%
| -2.5%
| |
Non-interest income | 35,297 | 23.3%
| 28.5%
| |
Profit before provisions | 93,514 | 16.3%
| 7.3%
| |
Loan Impairment charges | -651 | -79.1%
| -60.3%
| |
Total Opex | -35,878 | 41.8%
| 9.1%
| |
PBT | 56,985 | 9.6%
| 8.3%
| |
Tax | -7,682 | -13.9%
| -3.4%
| |
Tax rate
| 13.5%
| -369bps
| -163bps
| |
PAT | 49,303 | 14.5%
| 10.4%
| |
Source: Company financials, Investment One Financial Services Research
Q1 2019 BANKS COMPARISON SHEET |
| ||||
NGN billion (unless stated otherwise) |
| ACCESS | ZENITH | GT BANK | |
Key Income Statement Figures | Gross Earnings | 160.1 | 158.1 | 110.3 | |
Net Interest Income | 56.8 | 86.1 | 58.2 | ||
Non-interest Income | 46.8 | 32.7 | 35.8 | ||
Total Expenses | -55.1 | -59.4 | -35.9 | ||
Loan Impairment Charges | -3.4 | -2.1 | -0.7 | ||
Profit Before Tax | 45.1 | 57.3 | 57.0 | ||
Y/Y PBT Growth
|
| 64.4%
| 6.1%
| 8.0%
| |
Dividend (Kobo per share) | nil | nil | nil | ||
EPS (kobo per share) | 139 | 160 | 174 | ||
Key Balance Sheet Figures | Total Assets | 6,427 | 5,877 | 3,556 | |
Total Liabilities | 5,851 | 5,098 | 2,929 | ||
Total Equity | 576 | 779 | 627 | ||
Key Ratios | Net Interest Margin | 5.6% | 8.9% | 9.9% | |
Cost of Fund | 4.4% | 3.0% | nil | ||
Cost to Income | 53.2% | 50.9% | 38.6% | ||
NPL ratio | 10.2% | 4.9% | 7.0% | ||
Liquidity (bank level) | 47.6% | 66.7% | 47.7% | ||
Cost of Risk | 0.5% | 0.4% | 0.1% | ||
Capital adequacy ratio (bank level) | 19.1% | 25.0% | 22.3% | ||
ROE | 30.9% | 25.2% | 32.8% | ||
ROA | 2.9% | 3.4% | 5.8% | ||
Source: Company financials, Investment One Financial Services Research
