Despite the foreign exchange travails bedeviling Nigeria,Guaranty Trust Bank ended second quarter operations with a foreign exchange revaluation gain that multiplied its first quarter profit figure more than three times. Anyone will agree that the bank is in a year in which its ability to keep earnings stable is to be tested and the revaluation gain has come quite timely to the rescue.
With the depreciated value of the naira, the revaluation gain soared a clear 834% year-on-year to stand at N61.25 billion at the end of the second quarter. Revenue growth therefore accelerated from the first quarter performance and the full year outlook for both income and profit has improved significantly for the bank.
The bank succeeded in strengthening the two sides of its operational flow – converting assets into revenue and revenue into profit.
Profit margin improved to reinforce its industry leading position against the generally declining trend in the business. Rising credit losses remain a major challenge for the bank but other major costs elements of the bank are under control.
The earnings leap in the second quarter has positioned the bank for the strongest earnings growth records since 2012.
The bank posted gross income of N209.87 billion at the end of the second quarter operations, a growth of 37.2% year-on-year. The full year outlook indicates gross earnings in the region of N367 billion – an expected accelerated increase of 21.5% over the N302 billion figure the bank reported in 2015. The bank had raised gross earnings by 8.4% in 2015, which was a slowdown from a growth of close to 15% in the preceding year. The strongest revenue growth in five years can be expected from Guaranty Trust Bank in 2016 based on the current growth rate.thecable.ng