DrAwo:
For contrast, compare the same numbers for GTCo over the preceding 5 years (2013 to 2017)

GTco
Deposit growth 42%
Loan growth 40%

ImperialCovfefe:


Great insights boss, as usual. Let me add some color.

For the NPL, they simply are more aggressive in pushing loans to [IFRS] stage 2. When macro changes or they sense issues with the creditors, they preemptively take some charges and push the loans to NPL, far faster than their peers.

As for the loans, Agbaje has repeatedly stressed in the earnings call that the interest rate was being artificially suppressed by the CBN, and has been positioning for a while for a rise in rates to match with the underlying macro realities. He allowed lots of loans to be paid back in full without redeploying them and noted he doesn't want to even think about competing in reducing loan rates to the highest [credit] quality firms.

It's clear that GTCo is deliberately slowing loan growth possibly due to the low interest environment or for some other reasons best known to them...

Now that rates are up, we'll see what cards they have up their sleeves...

Very stimulating chat by the way...

DrAwo:




It's clear that GTCo is deliberately slowing loan growth possibly due to the low interest environment or for some other reasons best known to them...

Now that rates are up, we'll see what cards they have up their sleeves...

Very stimulating chat by the way...

They also have to think about the macro realities and credit cycle. The number one consideration for investors when looking at banks is the quality of the underwriting process. As they are inherently a very-leveraged business, this cannot be overemphasized. Most banks have capital to risk-weighted assets of around ~20%. Equity holders can very easily be wiped out when loans default [imagine liabilities of over N4.84tr and SE of N0.84tr].

So, imagine a country where the consumers are weak and there has been no growth in nominal GDP per capita since 2016. Coupled with purchasing-power-destroying inflation running hot. Why will a sane company be increasing loans? I think the CBN may possibly be deluded.

DrAwo:

There you go....

Good stuff...

DrAwo:

Exactly...
I agree with you 100%... I've listened to all their calls in the last 2 years and it's very plain to see what's going on...

Between 2017 and 2021 (5 years), the following are the rate of growth in deposits and loans by FUGAZ save first bank.

Zenith Bank
Deposit growth 88%
Loan growth 57%

Access bank
Deposit growth 210%
Loan growth 110%

Uba
Deposit growth 130%
Loan growth 62%

GTCo
Deposit growth 100%
Loan growth 28%

Thanks a lot @DrAwo, @ositadima1 and @ImperialCovfefe for the wonderful contributions. I enjoyed every bit of it.

My question however is that, is it not a good approach GTCO took by reducing the amount of loan given out in an environment of low interest rate, crash in Naira (invariably strong dollars) and especially when general election is approaching? From the above post, their deposit growth is not looking bad compared to other banks.

Thanks.

GTCO share price currently on a good support @16.85 and a price dip below 15 naira will be "jara"...

BullBearMkt:
GTCO share price currently on a good support @16.85 and a price dip below 15 naira will be "jara"...

we wait for the jara. This election is really affecting the market. Seem to me like alot of money will be spent and alot of that will come from the market.
There seem also, to be alot of diplomatic, local and international issues regarding Nigeria. From ethiopia to UAE to USA security directory. These are definitely not the best of times for Nigeria and the market in particular. Governance seem to be suspension at the moment as politics and intenational travels seem to have taken over

BullBearMkt:

Thanks a lot @DrAwo, @ositadima1 and @ImperialCovfefe for the wonderful contributions. I enjoyed every bit of it.

My question however is that, is it not a good approach GTCO took by reducing the amount of loan given out in an environment of low interest rate, crash in Naira (invariably strong dollars) and especially when general election is approaching? From the above post, their deposit growth is not looking bad compared to other banks.

Thanks.

I think that a quantitative answer would require a financial model that takes net interest income, NPL and default loans, assets pledged as collateral, etc as imputes.

On d surface it sounds like a good approach.

The salary is not for a lifetime whereas the allowance is. There is no guarantee she won't be booted out during the next elections.

Harvestock01:


What about the £84,000 MP salary?

The September report is now available on the NGX website

https://doclib.ngxgroup.com/market_data-site/other-market-information-site/FPI%20Report/NGX%20Domestic%20and%20Foreign%20Portfolio%20Investment%20Report-%20September%202022.pdf

thesilentone:
The number of institutions selling their stakes and the % of holdings being sold in some of the banks goes beyond mere portfolio rebalancing.

I can't find the September 2022 FPI report, if anyone has got it, please share. The last available one is August 2022.

Cheers

Mehn, Nigeria is going through a lot.

The question Phil would ask in this scenario is: What is the event that has caused this? The answer would determine what he would do

ositadima1:


Moat acid test on Gtb(GTCO) Group from d book Rule #1 by Phil Town.

Appart from EPS and ROE other values are in Billion Naira. Average Growth over periods 10 year, 5 year and 1 year are in %.

ROE, return on equity, has remained above 20%, while profits grew along side equity, from 2019, profits started slowing down.

EPS has had 7% compounded growth in d last 10 years, with a sharp 14% drop in 2021.

Olaide1295:
Mehn, Nigeria is going through a lot.

Nigeria should weather this easily unlike a country in the south of Africa and many in South America that are marked for a state collapse.

This end of 2022 and part of 2023 will be challenging for most countries in the world.

thesilentone:
The question Phil would ask in this scenario is: What is the event that has caused this? The answer would determine what he would do

Yeah, he mentioned investing in business you know about.

I doubt the accuracy of some of d metrics in dat chart as i had a hard time finding and extracting d right parameters.

For example, calculating FCF when it comes to banks and finance stocks is hard to tell appart which entries are due to operations and/or financing activities.

Also, used ROE instead of ROIC for same reasons.

Phil doesn't encourage people to invest in banks/finance stocks/mining because they have 'special metrics' different from other companies. Their propensity to classify certain items on their books as they deem fit peculiar to their sector is seen as unfit for his valuation methods.
His methods and metrics would sit well with other sectors.

ositadima1:


Yeah, he mentioned investing in business you know about.

I doubt the accuracy of some of d metrics in dat chart as i had a hard time finding and extracting d right parameters.

For example it is hard calculating FCF when it comes to banks and finance stocks cos it is hard tell appart which entries are due to operations or financing activities.

Also, why i used ROE instead of ROIC as used in d book.

Sunak is now our new PM.

thesilentone:
Sunak is now our new PM.

the UK
https://www.tradingview.com/chart/GBPUSD/PmYcl4Eb-Either-Johnson-Sunak-Or-Whoever-Cable-Still-In-Bear-Trend/

BullBearMkt:

the UK
https://www.tradingview.com/chart/GBPUSD/PmYcl4Eb-Either-Johnson-Sunak-Or-Whoever-Cable-Still-In-Bear-Trend/

He is a Brit. Hence the use of "our".

thesilentone:
Sunak is now our new PM.

Congrats.

We will celebrate it with pineapple juice with indian chillies the Mumbai way.

What are the instructions to sell my UBN shares through this MTO at N7?
https://doclib.ngxgroup.com/Financial_NewsDocs/36990_UNION_BANK_OF_NIGERIA_PLC%20NOTIFICATION_OF_TITAN_TRUST_.pdf

https://doclib.ngxgroup.com/Financial_NewsDocs/36988_UNITED_BANK_FOR_AFRICA_PLC%20_QUARTER_3_%20_FINANCIAL_STAT.pdf

UBN might be delisted

RabbiDoracle:


He is a Brit. Hence the use of "our".

...Happy for Rishi Sunak. I know Indian business and financial communities in the UK (majority of them hold UK economy) will give him needed supports.

The Diwali celebration was made even more special

RabbiDoracle:


Congrats.

We will celebrate it with pineapple juice with indian chillies the Mumbai way.

Please my people, has GTB paid this year's interim? I know they declared interim. If not, what's the payment date?

Mills55:
Please my people, has GTB paid this year's interim? I know they declared interim. If not, what's the payment date?

Already paid.
I think on 30th of September.

UBN
At long last, Titan Trust is buying out minority shareholders......
@Mpeace are you still holding unto it?

From my % calculations now,
Bulk purchase from majority shareholders is 89.39%
Minority shareholders: 6.59%
So, 89.39% + 6.59% = 95.98%

Who owns the remaining 4.02% .......Or maybe this was acquired off record.

** For those planning to take part in the Mandatory Take-over @N7, if not already seated in the bus, you have only today and tomorrow to key into it.

Qualification Date is Monday 31st October 2022
..BUT for settlement purpose (T+3days), you have to buy latest 26/10/2022.
REGISTRAR: Cardinal Stone

UNILEVER
Sighted @10.50 earlier.......
Historical 52weeks low was 11.15.......

A good bargain @10.50?
I think Yes, but only time will tell.......Q3 also.....
*Just my opinion*

At some point, the MM needs to create liquidity in Guinness.

No point sitting on their hands for 10 trading days

Wapgod:
What are the instructions to sell my UBN shares through this MTO at N7?
https://doclib.ngxgroup.com/Financial_NewsDocs/36990_UNION_BANK_OF_NIGERIA_PLC%20NOTIFICATION_OF_TITAN_TRUST_.pdf

There should be a form to fill......but I don't think it's out yet........or you may ask your broker to forward it if they have it.

Also try and set your E-Dividend mandate right with Cardinal Stone.......if you don't have active one yet.

Looks like some of our brethren have begun cutting their losses in GEREGU.

yMcy56:
UNILEVER
Sighted @10.50 earlier.......
Historical 52weeks low was 11.15.......

A good bargain @10.50?
I think Yes, but only time will tell.......Q3 also.....
*Just my opinion*

...2 year low. Price below 9.50 will be even better
But is the company still active in the country?

BullBearMkt:
....2 year low. Price below 9.50 will be even better
But is the company still active in the country?

Still active sir.
Paid dividend of 0.50k last financial year.
Compliment Sir. Nice seeing you back on the thread.