Guaranty Trust Holding Company Plc (GTCO) has posted a pre-tax profit of N601 billion for the half year ended June 30, 2025, marking a sharp decline from the N1 trillion it recorded in the same period of 2024.

Profit after tax also dropped to N449.01 billion, compared to N905.57 billion in the first of 2024.

Despite the earnings decline, the board approved an interim dividend of N1.00 per share, maintaining the payout declared in the corresponding period of last year.

The dividend will be paid to shareholders on the register as of October 7, 2025.

Gross earnings remained resilient above the N1 trillion marks at N1.073 trillion, though representing a 22.97 per cent year-on-year decline.

The top line was buoyed by robust interest income growth, which surged 71 per cent to N812.36 billion, accounting for 76 per cent of gross earnings compared to 44 per cent a year earlier.

The breakdown shows a notable shift in income sources, income from investments in securities contributed over 35 per cent of gross earnings at N375 billion, surpassing the 27 per cent contribution from loans and advances.

On the expense side, interest costs rose 43 per cent year-on-year to N154 billion, largely from customer deposits, which climbed 44 per cent to N147 billion. Still, this accounted for just 18 per cent of total interest income, keeping spreads relatively healthy.

Consequently, net interest income climbed to N632.24 billion, up 29 per cent from the first half of 2024. After impairment charges of N54.97 billion—driven mainly by higher Stage 2 provisions—net interest income after provisions stood at N577.67 billion, representing nearly 30 per cent year-on-year growth.

From a balance sheet perspective, GTCO’s growth remained deposit-led. Customer deposits grew 19 per cent to N11.878 trillion, accounting for 71 per cent of the group’s total assets of N16.692 trillion. Loans and advances rose 21 per cent to N3.358 trillion, reflecting moderate credit expansion.

Analysts say the results reflect resilience but also underline a structural shift in GTCO’s earnings model.

Reacting, Dr. Kemi Adetunji, financial analyst at Afrinvest Consulting, noted that the reliance on securities income shows the group is adapting to high-yield opportunities in fixed income markets, but this raises questions about sustainability.

“Loan growth is steady but not the main driver, which could constrain long-term core banking revenues.”

Charles Eze, an independent market strategist, added: “The drop in profit is significant, but GTCO’s spreads remain healthy, and its balance sheet is strong. The dividend decision shows confidence in liquidity. For investors, the 63 per cent YtD share price gain reflects optimism that the bank will rebound once macroeconomic headwinds ease.”

Still, analysts warn that rising funding costs and slower fee income growth—especially from electronic banking—may pressure margins going forward.