By Bamidele Famoofo
Guaranty Trust Holding Company Plc, one of Nigeria’s biggest financial services groups, recorded a decline of 15.42 percent in profit after tax (PAT) to N218.1billion in first quarter of the financial year ending December 31, 2026.
The shortfall in profit was primarily due to higher tax liabilities, with income tax expense surging to ₦84.76 billion from ₦42.35 billion in Q1 2025. Earnings per share consequently declined to ₦5.89 from ₦7.83, in line with the reduction in profit attributable to equity holders, which stood at ₦215.3 billion compared with ₦254.4 billion in the prior period.
Profit before tax grew by just 0.88 percent year-on-year to ₦302.9 billion from ₦300 billion in Q1 2025, suggesting near-stagnation at the pretax level despite top-line income growth. Guaranty Trust Holding Company Plc (GTCO) delivered a mixed but broadly resilient financial performance for the first quarter ended March 31, 2026. Interest income grew by 17.52 percent year-on-year to ₦467.0 billion from ₦386.0 billion in Q1 2025, driven by expansion in loans to customers and improved yields on earning assets.
The core banking business remained a source of strength, as net interest income rose by 11.98 percent to ₦356.3 billion from ₦318.2 billion in the prior period. However, this growth was
partially tempered by a sharp 39.75 percent increase in interest expenses to ₦110.7 billion
from ₦79.2 billion, reflecting the continued elevated cost of funds as deposit repricing deepened in the high-interest rate environment. Interest expenses on customer deposits accounted for 92 percent of the total interest expense, rising 34 percent year-on-year.
Looking at key metrics, performance was mixed. On the positive side, asset quality continued to improve, as loan impairment charges declined by 41.05 percent year-on-year to ₦7.95 billion, pointing to a cleaner and better-performing loan book. Net interest income after impairment rose by 14.33 percent to ₦348.3 billion, a strong indicator of underlying credit quality. On the cost side, operating expenses increased by 13.7 percent to ₦139 billion, outpacing the growth in net interest income and weighing on cost efficiency. On the balance sheet, total assets grew by 5.54 percent to ₦18.75 trillion, loans and advances to customers rose to ₦3.17 trillion, customer deposits expanded to ₦13.21 trillion, and shareholders’ funds strengthened to ₦3.63 trillion — up 6.28 percent year-on-year, reflecting the group’s continued capacity for balance sheet growth.
A continuous positive but cautious sentiment is expected around the stock, but the tax liability spike and EPS decline will temper the enthusiasm of earnings-focused investors until greater clarity emerges on the group’s effective tax rate trajectory for the rest of 2026.
