‘GTBank is the most efficient lender in Nigeria’
Guaranty Trust Bank Plc has utilized the resources of shareholders in generating more profit more than any other lender in Africa’s most populous nation.
The 2014 audited financial statement of the largest lender by market value shows it recorded a return of average equity of (ROAE) of 35 percent, the highest in the industry.
Net profit margin increased to 52.07 percent in December 2017 as against 50.39 percent as at December 2016.
Net profit margin is the ratio of net profits to revenues for a company or business segment. Typically expressed as a percentage, net profit margins show how much of each dollar collected by a company as revenue translates into profit.
Analysts had forecast a stellar performance for tier 1 lenders before the earnings seasons kick start.
This is because the big banks have better capital buffers, more reserves, large market share and an excellent risk management strategy, all of which will help them cushion the provisioning they are expected to take following the rising non-performing loans portfolio in their books.
“We expect most of the tier 1 lenders to maintain the positive form and the exchange market have already factored the positive expectation. I believe most of them will do well since the economy has improved,” said Ayodeji Ebo managing director and CEO of Afrinvest Securities Limited.
GTBank’s impressive performance validated and exceeded analysts’ expectations as net income spiked by 29.19 percent to N132.28 billion in December 2017 from N132.28 billion as at December 2016.
Interest income surged by 25.15 percent to N327.33 billion in the period under review from N262.49 billion as at December 2016.
GTBank shares have gained 16.07 percent since the start of the year, valuing it at N1.39 trillion.
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