GCB Bank recorded strong profit growth in the first half of 2024 (1H 2024) compared to the same period in 2023.
This strong performance was primarily driven by a significant increase in customer deposits year-to-date (YTD), coupled with dedicated efforts at optimising operational efficiency.
The 1H 2024 financial performance results from the Bank’s strategic shift to a strong focus on sales, transaction banking and a customer-centric approach. Profit Before Tax for the period increased by 35 percent year-on-year (y/y) to GHȼ700.3 million, driven by growth in interest income and supported by a 21 percent year-to-date increase in customer deposits and an increase in net fees and commission income.
Total revenue increased by 5 percent y/y to GHȼ 1.89 billion at 1H 2024. Net interest income grew by 5 percent y/y to GHS 1.43 billion in 2024, with net fees and commission income also increasing by 28 percent to GHȼ245.4 million. Increased earnings from electronic services, trade services, processing and facility fees drove the net fees and commission growth over the half-year period. Additionally, net trading income contributed GHȼ 211.8 million to revenue in 1H, 2024.
Operating expenses for 1H 2024 came in at GHS1.08 billion, up 17 percent from GHȼ921.1 million in 2023. This increase was driven by inflation and currency depreciation pressures.
Impairment loss on financial assets for the period declined by 70 percent y/y to GHS 104.8 million in 1H 2024. This sharp decline in impairment loss resulted from the Bank’s enhanced risk management and risk mitigation strategies.
The balance sheet also grew substantially in the review period. Total assets surged to GHS 33.20 billion, representing a 22 percent increase YTD. A significant deposit growth, which reflects clients’ unwavering confidence in the Banks’ resilience amidst the prevailing macroeconomic uncertainties, underscored the increase in the balance sheet size.
Shareholders’ Equity surged by 15 percent YTD to GHȼ3.22 billion in 1H 2024 due to the increased profit for the period, bolstering the Bank’s financial performance and increasing shareholders’ value. This growth in equity underscores our strong financial footing and demonstrates the Bank’s capacity to generate internal capital.
Earnings per share also grew, rising from GHȼ2.52 in 1H 2023 to GHȼ3.20 in 1H 2024. Also, the Capital Adequacy Ratio stood at 18.5 percent, well exceeding the regulatory requirement of 10 percent. Return on Equity reached 26.2 percent, reflecting efficient capital utilization, while Return on Assets settled at 2.8 percent.
Commenting on the 1H 2024 performance, Mr. John Kofi Adomakoh, Managing Director of GCB Bank PLC, said: “GCB continues to record strong and higher quality earnings as well as improved returns to shareholders despite the challenges and uncertainties in the market combined with intensifying competition”.
Mr. Adomakoh explained that a strong focus on sales and transaction banking, growth in the Bank’s client base and growing relationships, stringent credit underwriting standards coupled with cost-effectiveness, strong governance, and effective risk management and control drove the 1H 2024 performance.
Concerning the intended capital raise, Mr. Adomakoh indicated that the Bank decided to put the capital raise on hold on the back of strong financial performance in 2023. He revealed the Bank’s commitment to continue to rebuild capital through future profits while assessing capital requirements on an ongoing basis amidst heightened uncertainties in the operating environment and regulatory developments. The GCB Managing Director shared Management’s commitment to maintaining optimal capital levels to support strategic and business objectives to drive long-term success and returns for shareholders.
The Bank’s 1H 2024 results thus confirm that GCB remains a beacon of financial stability and resilience, well-prepared to navigate the intricate financial landscape in Ghana with steadfastness, confidence and strategic foresight.
