Guaranty Trust Bank Plc, Nigeria’s largest lender by market value, said first-half profit rose 45 percent as foreign-currency gains in the wake of the naira’s devaluation compensated for a surge in bad-loan charges.
Net income climbed to 77.5 billion naira ($237 million) from 53.4 billion naira year ago, Lagos-based Guaranty said in a statement on Wednesday. The lender made foreign-exchange revaluation gains of 61.2 billion naira, compared with 6.9 billion naira a year ago, while also turning a profit on trading investments from losses a year earlier. Impairments rose to 37.5 billion naira from 5.95 billion naira a year earlier, it said.
The stock pared an earlier rally of as much as 6.8 percent to close 1.7 percent up at 25 naira, the highest level in more than a year. Guaranty’s shares have advanced 38 percent this year, the biggest increase of any other bank on the Nigerian Stock Exchange All Share Index. Guaranty Trust also reported a 48 percent increase in net fee and commission income to 34.8 billion naira.
The naira has weakened almost 39 percent against the dollar since the central bank in June dropped a 16-month peg against the U.S. currency, which has been blamed for causing a shortage of foreign exchange and contributing to the economy’s 1.8 percent contraction in the first quarter, the first in three decades.