GCB Limited for the period between March 2020 and March 2021, witnessed a deterioration in its loan asset quality.
The deterioration or retrogression in the bank’s loan asset quality was occasioned by an increase of its Non-Performing Loans (NPLs) as a ratio of gross loans from 6.5 percent in Q1 2020 to 13 percent in Q1 2021.
Loans made to customers at the end of the first quarter of 2021, according to GCB’s unaudited Financial Statement for 2021, amounted to Ghs 3.6 billion.
An increase of over Ghs 200 million when compared to the Q1 2020 total loans of Ghs 3.4 billion.
Posted liabilities at the end of March 2021, stood at Ghs 14 billion.
Compared to same period last year, GCB Bank’s liabilities expanded by some Ghs 3.1 billion on a year-on-year (yoy) basis, as total liabilities recorded at the end of Q1 2020 was Ghs 10.9 billion.
In the banking or financial services space, liabilities is often viewed as an ‘asset’ and not debt due to the fact that a major component of a bank’s liabilities are deposits made by customers which the bank can in turn use for credit creation by lending the monies out other customers as loans.
A perusal of the bank’s balance sheet by norvanreports, revealed deposits from customers as the main driver of the bank’s liabilities.
Deposits from customers for the period under review surged from Ghs 9.5 billion in Q1 2020 to Ghs 12.5 billion in Q1 2021.
GCB within the same period also managed to increase its total assets value by more than Ghs 3.5 billion.
Posted assets value increased from Ghs 12.6 billion in Q1 2020 to Ghs 16.2 billion in Q1 2021.
Balance sheet items supporting assets value growth were investment securities and non-pledged trading assets.
The bank’s holdings of investment securities rose from Ghs 5.9 billion to Ghs 8.6 billion in Q1 2020 and Q1 2021 respectively.
Non-pledged trading assets also increased from Ghs158 million to Ghs 706 million in Q1 2020 to Q1 2021 respectively.
Recorded profit-after-tax amounted to Ghs 131 million at the end of the first quarter, representing an increase of Ghs 38.6 million from the Q1 2020 figure of Ghs 92 million.
Shareholders on the back of the recorded Ghs 131 million profit for Q1 2021, will enjoy a dividend payment of Ghs 1.98 pesewas, an increase of Ghs 0.59 pesewas from the Ghs 1.39 pesewas dividends paid in Q1 2020.
With respect to Capital Adequacy Ratio (CAR), GCB marginally increased its CAR from 18.3 percent to 19.7 percent within the period.
