Guaranty Trust Holding Company Plc (GTCO) regained some operational momentum in the third quarter, but its profit decline persisted, with profit after tax falling to ₦614.6 billion at the end of nine months of operations.
Quarter-on-quarter declines in revenue and profit recorded in the second quarter reversed to gains in the third quarter, improving the company’s year-on-year performance. However, GTCO remains on course for a second consecutive annual decline in profit.
The group’s interim financial report for the nine months ended 30 September 2026, shows improvements in key income lines quarter-on-quarter, strengthening overall earnings performance and moderating the year-on-year decline in profit.
Total interest income, the group’s principal revenue line, recovered from ₦406.4 billion in the second quarter to ₦418.5 billion in the third quarter, after declining from ₦467 billion in the first quarter.
The recovery, however, was insufficient to sustain year-on-year growth in interest income, which continued to slow — from 17.5% in the first quarter to 7.5% at half year and 5% at the end of the third quarter. Total interest income stood at ₦1.29 trillion for the nine-month period.
Fee and commission income, the group’s second-largest revenue line, also recovered from a quarter-on-quarter decline in the second quarter to record an increase in the third quarter.
At ₦71 billion, third-quarter fee and commission income rose from ₦62 billion in the second quarter, although it remained below the ₦80.3 billion recorded in the first quarter.
The recovery changed the year-on-year performance for the nine-month period from a 6% decline at half year to a marginal increase at the end of September, with fee and commission income reaching ₦213.5 billion.
Net trading gains on financial instruments also contributed to the improved earnings momentum. The income line recorded its highest quarterly figure of the year at more than ₦32 billion in the third quarter, rebounding from ₦21.6 billion in the second quarter after declining from ₦25.7 billion in the first quarter.
The improvement lifted net trading gains from ₦47.3 billion at the end of the first half to about ₦80 billion at the end of the third quarter.
Other income also contributed to the recovery, recording gains in the second and third quarters of about ₦46 billion and ₦30.4 billion, respectively. This offset the marginal loss recorded in the first quarter, bringing other income to ₦74.8 billion at the end of September.
Year-on-year, other income more than doubled, increasing by 104% in the third quarter. This provided additional support for the quarter-on-quarter improvement in profit.
Quarterly profit after tax rose from ₦196 billion in the second quarter to ₦200.4 billion in the third quarter, recovering from a decline from ₦218 billion in the first quarter.
However, third-quarter profit after tax remained below the ₦250.6 billion recorded in the corresponding period of 2025.
The pressure on the bottom line is largely sustained by rising funding costs, which have outpaced growth in interest income.
Interest expenses stood at ₦356 billion at the end of the third quarter, representing a year-on-year increase of 27.7%. This was more than five times the 5% increase in total interest income over the same period.
While total interest income increased by ₦61 billion, interest expenses rose by more than ₦77 billion over the nine-month period. This resulted in a decline of more than ₦16 billion in net interest income, which stood below ₦936 billion at the end of September.
One major cost line has helped moderate the impact of rising interest expenses: net loan impairment charges. These fell from about ₦70 billion to ₦29 billion year-on-year at the end of September 2026.
The reduction in loan impairment charges more than offset the decline in net interest income, lifting net income after impairment charges from ₦882 billion to about ₦907 billion.
The improvement, however, did not translate into higher profit after tax, as constraints on revenue growth and rising operating costs continued to squeeze margins.
GTCO ended the nine months with profit before tax declining from ₦900.8 billion to about ₦880 billion. However, income tax expenses rose from ₦201 billion to ₦265 billion over the period, further pressuring the bottom line.
Consequently, profit after tax fell by 12% year-on-year to ₦614.6 billion at the end of the third quarter.
GTCO is now heading for a second consecutive annual decline in profit, having ended 2025 with profit after tax falling from more than ₦1 trillion in 2024 to ₦865.7 billion.
