Nigeria’s biggest lender by market value saw its first quarter profit thin by about a tenth or N4.520 billion, as revenue from interest came under pressure and provision for potential credit loss linked to the coronavirus outbreak ate away at earnings.
Guaranty Trust Bank (GTB) noted in its earnings report for the first quarter of 2021 issued Wednesday that net interest income stood at N52.434 billion, 18.4 per cent weaker than the figure for the same period of last year, reflecting the urgency to stabilise earnings from other sources.
It hopes to secure a payment service licence to kick-start a fintech unit any moment from now, and also part of the way to go is its ambition to acquire a bank in Kenya, East Africa’s largest economy.
Transitioning to a holding company this year is crucial to Segun Agbaje-led GTB’s game plan for weathering stormy days just as setting up insurance, pensions and asset management divisions are parts of the mix.
As regulation demands, GTB put aside N1.86 billion to cover expected loan defaults and credit assets liable to become toxic. It compares with the N1.223 billion committed to that purpose between January and March 2019.
Lenders in Nigeria risk having their average impaired loan ratio surging to anywhere between 10 to 12 per cent this year as the tap of debt relief measures, which helped restrain a spike in impaired loans in 2020, runs dry, New York-based credit rater warned in a commentary on the Nigerian banking industry in December.
Moody’s, another rating agency, gave a similar projection last month.
GTB’s pre-tax profit came to N53.683 billion down from N58.204 billion. Profit for the quarter was N45.546 billion, declining by nearly 10 per cent.
The lender highlighted a jump of 26.8 per cent in account maintenance charges and more than a half in E-business Income as the drivers of an improvement in fee and commission income from N14.463 billion to N17.574 billion.
Shares in GTB closed in Lagos on Wednesday at N30 per unit, up by 4.17 per cent.
Support PREMIUM TIMES' journalism of integrity and credibility
Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.
For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.
By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.
TEXT AD: Why women cheat: what every Nigerian man should know
![Honorable Minister of Information and Culture , Alh. Lai Mohammed addresses Pressmen [PHOTO: @FMICNigeria]](https://i1.wp.com/media.premiumtimesng.com/wp-content/files/2022/02/Honorable-Minister-of-@FMICNigeria-Alh.-Lai-Mohammed-addresses-Pressmen-e1644768239258.jpg?resize=120%2C86&ssl=1)
![Osun State Governor, Adegboyega Oyetola. [PHOTO CREDIT: Official Twitter handle of Mr Oyetola @GboyegaOyetola]](https://i0.wp.com/media.premiumtimesng.com/wp-content/files/2020/07/EbS68vSWsAERqqW.jpg?resize=75%2C75&ssl=1)
