GTCO: Setting Milestone Record in Dividend Payout to Shareholders

Guaranty Trust Holding Company Plc (GTCO) has set a new record in the Nigerian financial services industry in terms of  dividend payment, having recommended a total N8.03 per share to shareholders for the 2024 financial year, writes Kayode Tokede

GTCO has surprised the capital market community with robust dividend payout in the financial year performance ended December 31, 2024.  The lender after overcoming domestic and foreign challenges is expected to pay shareholders a total dividend of N8.03 kobo per share in 2024 financial year from N3.20 total dividend paid in 2023.   The declared N8.03 is the highest dividend payout in the GTCO’s history and in the financial sector in Nigeria.
In the half year ended June 2024,  an interim dividend of N1.00 per share was recommended and paid. Now, the board of directors has proposed a final dividend of N7.03 per share  for the year ended December 31, 2024 ( 2023 was  N2.70 per share) on the issued ordinary shares of 34,138,949,684 of 50k each.
The 2024 dividend payout translates to a dividend yield of 10.9 per cent based on the last closing price of N64.25/share (March 27,2025).
The dividend payout in 2024 was made possible when the Group reported profit before tax (PBT) of N1.266 trillion, representing an increase of 107.8per cent over N609.3billion recorded in the corresponding year ended December 2023, while profit after tax (PAT) closed 2024 at N1.02 trillion, an increase of 88.6 per cent from N539.65 billion declared in 2023.
The bank’s Nigeria operations accounted for 77.3 per cent of PAT;  West Africa – 18.4per cent, East Africa – 1.5per cent, UK -1.7per cent and Non-Banking Businesses – 1.1per cent.
GTCO reported N1.34 trillion interest income in 2024, about 143.6 per cent growth over N550.76 billion in 2023, driven by higher income from key contributory lines. In nominal terms, the group generated higher revenue from investment securities (+228.8 per cent to N599.32 billion) and loans & advances to customers (+75.2 per cent  to N509.25 billion), placements with other banks (+242.5per cent to N226.83 billion), which was sufficient to offset the decline in income from loans and advances to banks (-44.7per cent).
Elsewhere, interest expense moved to N283.22 billion in 2024, an increase of 148.3 per cent from N114.06 billion in 2023, primarily driven by the elevated interest rate in the environment, which led to increased funding costs.
Accordingly, the Holdco’s interest cost on customers’ deposit holdings rose by 114.5per cent to NGN220.47 billion, driven by deterioration in the group’s funding mix (CASA 2024: 83.6 per cent as against 2023: 88.6per cent).
At the same time, borrowing costs grew by 543.5per cent to N47.34 billion. Consequently, the net interest income rose by 142.4per cent to N1.59 trillion. Ultimately, the net interest income (ex-LLE) settled 176.2per cent higher at N921.92 billion, following an increase in loan impairment charges (+32.7per cent to N136.66 billion).
The Group recorded a 60.9 per cent growth in operating expenses (OPEX) from N250.4 billion in 2023 to N403.0 billion in 2024 with non-controllable cost mix improving to 28.9per cent of the total operating  expenses in 2024 from 33.3per cent in 2023.
The key OPEX growth drivers are: increase in regulatory charges – AMCON levy and Deposit Insurance Premium. AMCON levy increased by 34.2per cent (N36.6billion vs N27.4billion) due to growth in total asset and  contingents base (N7.33trillion vs N5.46trillion).
Also, deposit insurance premium increased by 28.9per cent (N21.9billion vs N17.0billion) due to a 48.1per cent increase in underlying customers’  deposits volume (N5.26trillion vs N3.55trillion) and 84.3per cent growth in occupancy costs and repairs & maintenance (N35.2billion vs N19.1billion), driven by impact of exchange rate and increase in price occasioned by rise in  diesel, fuel, and general maintenance costs as well ground and water rates.
Also, GTCO witnessed 48.4 per cent growth in technological and service related expenses to N88.0billion in 2024 vs N59.billion in 2023 is in line with the Group’s growth aspirations, necessitating increased spend on technology. The weaker Naira/US$ conversion also had a major impact on the translation of subsidiaries’ OPEX balances.
However, the 2024 FY  performance reflects not just strong earnings but also the quality and sustainability of GTCO’s earnings, underpinned by a well-diversified revenue base, robust risk management practice, and disciplined capital management.
The Group recorded growth across all financial and non-financial metrics, and continues to maintain a well-structured, healthy, and diversified balance sheet.
GTCO’s total assets closed 2024 at N14.8trillion, up by 53 per cent from N9.69trillion in 2023.
The group’s asset base is well diversified and well structured across all business verticals with loans accounting for 18.8per cent, investment securities 29.2per cent, cash & cash equivalent -31.6per cent, a testament to the Group’s strong liquidity position and robust earnings capacity.
The Group’s loan book (net) increased by 12.3per cent from N2.48trillion in December 2023 to N2.79trillion in 2024, while deposit liabilities grew by 37.8per cent from N7.55trillion to N10.40trillion during the same period.
The Group’s total equity at N2.7 trillion in 2024, an increase of 83.6 per cent when compared to N1.45 trillion reported in 2023.
Strong Ratios, Sustaining Robust Capital Buffers
Overall, the group continues to post one of the best metrics in terms of key financial ratios. For instance, Pre-Tax Return on Equity (ROAE) stood at 60.5per cent in 2024 from 50.3per cent in 2023, Pre-Tax Return on Assets (ROAA) moved from 7.7per cent to 10.3 per cent.
GTCO’s Capital Adequacy Ratio (CAR) stood at 39.3 per cent in 2024 from 29.20 per cent in 2023.  Cost to Income ratio emerged the lowest in the banking sector at 24.1 per cent in 2024 from 29.10per cent in 2023.
Capital Adequacy Ratio (CAR) remained very robust and strong, closing at 39.3per cent, likewise, asset quality was sustained as evidenced by IFRS 9 Stage 3 Loans which closed at 3.5per cent at Bank Level and 5.2per cent at Group in 2024 (2023: Bank, 2.5per cent; Group, 4.2per cent) and cost of risk (COR) closed at 4.9per cent from 4.5per  cent in December 2023.
Liquidity ratio closed at 49.2 per cent in 2024 up from 31.1per cent in 2023 well above the regulatory minimum  requirement of 30 per cent. Despite the pressure from competition and the need to cover for regulatory CRR debits, the Group  maintained an average liquidity ratio of 44.3 per cent during the period under review.

Market stakeholders applaud N8.03 per share dividend
The Managing Director/CEO, Globalview Capital Limited, Mr. Aruna Kebira stated that GTCO’s N8.03 per 50 kobo ordinary shares dividend payout to shareholders is massive.
“Even without factoring in the interim, the stock can still deliver a 10 per cent dividend yield.  It goes further to establish the bank as a leader in the industry, offering deliverables higher than Stanbic IBTC Holdings Plc. It also shows that even if the price of the stock rises above what is trading now, their earnings and dividend payout will be able to sustain it,” he added.
On its part, Vice President, Highcap Securities, David Adonri, said  that the lender’s 2024 financial year dividend is very fantastic distribution and it beats capital market community expectation.
Investment banker andstockbroker, Mr. Tajudeen Olayinka said that the dividend payout is a good one, to the extent that it could help some of their shareholders to either take their rights when they finally return to the market in the course of the year to issue additional shares or encourage prospective shareholders of the bank participate in any possible public offering. “The sustainability of such a high dividend payout by GTCO is something that requires additional investigation,” he said.
Speaking from a shareholder view, President, Pragmatic Shareholders Association, Mrs. Bisi Bakare, commended the dividend payout by the management of GTCO, urging sustainability  of policy.
“Shareholders want the dividend payout trend to continue. If N8.03 was declared in 2024 by 2025FY, we are expecting N10.00 total dividend payout. We (shareholders) are excited and happy with the board and management of GTCO for such a wonderful dividend payout.
“Mind you, we invested to get returns and paying N8.03 total dividend is something shareholders were not expecting.”
Analysts at Cordros Research in a report said: “GTCO’s performance was impressive, with financial indicators surpassing peers. First, the group continues to seal the title of the most efficient lender, with a CIR of 24.2per cent.
“Additionally, the group now holds the industry’s highest buffers relative to risky assets, with a CAR of 39.3per cent. Furthermore, following the sizable dividend proposed, GTCO boasts the highest dividend yield of 10.9 per cent.
“Looking ahead to 2025E, we expect continued positive momentum underpinned by improved credit creation. Although the stability of the naira may limit earnings growth, we expect the group’s strong operational efficiency to continue to support earnings.”
The Group Chief Executive Officer,  GTCO, Mr. Segun Agbaje in a statement said: “Our strong performance for 2024 underscores the resilience and depth of our business, driven by a well-diversified earnings base across our banking and non-banking subsidiaries, all of which are P&L positive.
“Our capacity to generate sustainable high-quality earnings, maintain strong asset quality, and drive cost efficiencies reflects the soundness of our long-term strategy and disciplined execution. We have also prudently provided for all our forbearance loans, well ahead of the June 2025 timeline, whilst fully accruing for the windfall tax, further strengthening our balance sheet and enhancing financial resilience.
He added:“The total dividend of N8.03k for the 2024 FYE is underpinned by the quality of our earnings and is in line with our long tradition of increasing dividend pay-out year-on year. Looking ahead, we remain committed to building a Financial Services Group that thrives on innovation, operational efficiency, and sustainable profitability.
“We will continue to deepen our relationships with customers, leverage technology to deliver cutting-edge financial solutions, and accelerate the growth of all our business verticals—Banking, Funds Management, Pension, and Payments—to unlock new opportunities and create more value for our shareholders.”

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