reports
- Gbemisola Ogungbade
GCB Bank: Q3 results show strong revenue growth and expanded loan book...
GCB’s Q3 21 results showed 24% yoy growth in its EPS to GHS0.47, higher than the 21% yoy expectation. The major drivers of the bank’s positive performance included net interest income, which grew 18% yoy. This is very different to the performance of the other Ghanaian banks we cover, with CAL Bank and Stanchart Ghana both reporting declines due to the contraction of their loan books. Although GCB’s NIM growth was muted as a result of lower loan yields, non-interest income also recorded stron...
- Faith Mwangi
- Gbemisola Ogungbade
GCB Bank: Q2 21 – High tax and impairment charges dampen earnings
GCB's Q2 21 EPS increased by only 6% yoy to GHS0.38, mainly on the back of an increase in tax charge (42% in Q2 21 from 30% in Q2 20) as a result of the government imposing a 5% financial sector recovery levy on PBT to support financial sector reforms. Compared with its peers CAL Bank and Stanchart Ghana, the government levy affected GCB more as the bank recorded a decline in PAT (-16% qoq). In addition, the bank saw a spike in loan impairment charges (+104% yoy and +38% qoq) owing to higher ...
- Faith Mwangi
- Gbemisola Ogungbade
Ghana banks: Impressive Q1 performance, but impairment charges remain ...
Ghana's banking sector recorded 18% yoy growth in net interest income in Q1 21, supported by an improvement in interest expense (up just 2% yoy vs +17% yoy in Q1 20) on the back of an increase in low-cost deposits (+18% yoy). In addition, there was 29% yoy growth in non-interest revenue across the sector, supported by a 48% yoy increase in trading income and a 67% yoy uptick in fee income. THREE BUYS, WITH A HOLD ON STANCHART; EGH IS OUR TOP PICK Our top pick in Ghana banks is EGH (Buy), whic...
Moody's announces completion of a periodic review of ratings of GCB Ba...
Announcement of Periodic Review: Moody's announces completion of a periodic review of ratings of GCB Bank Limited. Global Credit Research- 17 Jun 2021. Limassol, June 17, 2021-- Moody's Investors Service has completed a periodic review of the ratings of GCB Bank Limited and other ratings that are associated with the same analytical unit.
- Faith Mwangi
- Gbemisola Ogungbade
5 factors to watch when Ghana banks report their 2020 results
As Q4 20 earnings season (as well as FY 20) draws closer for Ghana's banks, we highlight five factors to watch: 1) DIFFERING RISK EXPOSURES In Ghana, the three sectors that have been most badly affected by Covid-19 are commerce & finance, tourism & hospitality, and transport. These three sectors accounted for 52.9% of total industry loans as of 2019, forcing the banks to reduce lending to these hardest-hit sectors and instead focus on pharmaceutical and health sectors. The banks we cover have...
- Faith Mwangi
- Gbemisola Ogungbade
Ghana banks: Positive outlook, but impairment charges key risk in Q1
In this report, we present our general expectations for Ghana banks in Q4 20 and Q1 21. KEY EXPECTATIONS FOR Q4 20 PERFORMANCE We have a positive outlook on the banking sector on the back of banks' impressive Q3 20 performance, which saw a 65% yoy growth in earnings, and 18% yoy increase in both deposits and total assets. Our top pick among the banks we cover is GCB – a high-performance bank with the biggest deposit size, lowering its cost of funds. The bank has the second largest loan book s...
- Faith Mwangi
- Gbemisola Ogungbade
Ghana's Covid spike forces govt to impose restrictions indefinitely
Ghana's President, Nana Akufo-Addo, addressed the country on 1 February regarding the rise in Covid-19 cases. 64 people have been confirmed dead in the space of two weeks, raising the total confirmed deaths to 416. Average daily new cases has jumped from 200 to 794, while total active cases have more than doubled from 1,900 to 5,358, with all 16 regions in Ghana recording active cases. The Greater Accra region dominates in terms of cases, with the regions in the table below accounting for 94%...
- Faith Mwangi
- Gbemisola Ogungbade
GCB Bank: Reiterate Buy as interest income remains impressive
WE MAINTAIN OUR BUY RECOMMENDATION WITH A TP OF GHS8.6 (ETR OF 115%) GCB is the largest bank in Ghana, and we like it for a number of reasons: 1. It has a strong deposit base. 2. We expect the bank's partnership with Eliho Ghana Ltd will offer room for improvement in GCB’s cost of funds. 3. GCB’s significant increase in investment securities will continue to boost its margins. 4. The stock currently trades at 0.5x PB, below its 5-year average multiple of 1.29x. Ou...
Moody's announces completion of a periodic review of ratings of GCB Ba...
Announcement of Periodic Review: Moody's announces completion of a periodic review of ratings of GCB Bank Limited. Global Credit Research- 30 Jun 2020. Limassol, June 30, 2020-- Moody's Investors Service has completed a periodic review of the ratings of GCB Bank Limited and other ratings that are associated with the same analytical unit.
- Nkemdilim Nwadialor
Ghana cuts GDP forecast as coronavirus tailwinds intensify
Finance Minister Ken Ofori-Atta cut Ghana's GDP growth forecast for 2020 by 530bps to 1.5%, the lowest in 37 years, due to the collapse in oil prices and the impact of the coronavirus pandemic. Ghana has recorded 195 Covid-19 cases and five deaths (as of 2 April 2020). So far, 5 of the 16 regions in the country have confirmed cases of coronavirus: Greater Accra Region (174), the Northern Region (10), Ashanti Region (9), Upper West Region (1) and Eastern Region (1). On Monday, President Nana A...
- Nkemdilim Nwadialor
GCB Bank: Stellar FY 19 results – Strong core revenue growth and loa...
GCB released its abridged FY 19 results which saw PAT rise 31% yoy to GHS428mn, above our GHS350mn forecast due to: 1) better-than-expected interest income which was boosted by impressive growth in loans; and 2) higher-than-expected non-interest income (up 29% yoy). Other positives include a 2.0ppts improvement in ROE and 2ppts decrease in the cost/income ratio which fell to 59%. GCB is our top pick within the Ghana banking space with a Buy rating and an unchanged target price of GHS12.2, whi...
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