GTBank Annual Report 2018

OTHER NOTES TO THE FINANCIAL STATEMENTS

The future minimum lease payments extend over a number of years. This is analysed as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Not more than one year Dec-2018 Dec-2017 Dec-2018 Dec-2017
Over one year but less than five years 264,899
- 264,899 -
-
- - - 264,899

- 264,899 - (2,300)

Less future finance charges - (2,300) - 262,599

- 262,599 -

The present value of finance lease liabilities is as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Not more than one year Dec-2018 Dec-2017 Dec-2018 Dec-2017
Over one year but less than five years
- 262,599 - 262,599

- - - -

- 262,599 - 262,599

(c) This represents the Naira value of foreign currencies held on behalf of customers in various foreign accounts
to cover letters of credit transactions. The corresponding balance is included in Foreign Banks - Cash collateral in other
assets.

(d) Movements in the number of share options outstanding and their related weighted average exercise prices are
as follows:

In thousands of Nigerian Naira Dec-2018 Dec-2017

At 1 January Average Exercise Share Rights Average Exercise Share Rights
Granted
Exercised Price Per Share (thousands) PricePer Share (thousands)

22.54 378,859 19.63 403,531

15.52 33,652 14.84 25,808

36.12 (48,593) 26.44 (50,479)

As at end of the Year 27.12 363,918 22.54 378,859

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The total unit of shares of the scheme stood at 1,318,246,000 The scheme was introduced as a compensation plan for the
as at December 2018, out of which 363,918,000 have been bank’s qualifying personnel to enhance employee retention,
granted. Out of the 363,918,000 Share Appreciation Right by offering the shares acquired by the SPV to qualifying
(SARs) granted as at Dec 2018 (Dec 2017: 378,346,000 members of staff at the prevailing net book value of the
SARs ), 271,741,067 SARs (Dec 2017: 292,251,197 ) have bank. Under the terms of the plan, the shares vest only if
met the vesting criteria. SARs exercised in 2018 resulted in a member has spent 10 years in the bank, 5 years in the
48,593,385 shares (Dec 2017:50,478,910) being granted scheme and the purchased shares are up to 3 years old from
at a weighted average price of N36.12 each (Dec 2017: the date of purchase. Upon exit if a member meets vesting
N26.44 each). conditions, the shares would be repurchased from the staff
by the scheme.
The fair value of SAR was determined using a multi-factor
model which entails using average share price for vested The liability for the SARs is measured, initially and at the
shares and multiple combination of 5.71% probability of end of each reporting period until settled, at the fair value
exits, number of employees years in the scheme and in the of the SARs, by applying an option pricing model, taking
organization for non-vested shares. into account the terms and conditions on which the SARs
were granted, and the extent to which the employees
As at 31st Dec 2018, the impact of the SAR on the statement have rendered services to date. The expected life used in
of financial position of the Group stood at N9,869,968,000 the model has been adjusted based on management’s best
(2017:N8,537,765,000 ). Of this amount, the liability on estimate for the effects of exercise restrictions (including the
vested but unexercised SARs was N8,629,921,000 (2017: probability of meeting market conditions attached to the
N7,618,703,000). The impact on the income statement option), and behavioural considerations. Expected volatility
for the year ended 31st Dec 2018 stood at N809,857,000 is based on the historical share price volatility over the past
(2017: N234,622,000) 3 years.

The Share Appreciation Right is a cash settled share based
compensation scheme managed by a Special Purpose
Vehicle (SPV) - Guaranty Trust Bank Staff Investment Trust.

Share options outstanding at the end of the year have the following expiry date and exercise prices:

Exercise price Share options (thousands of Naira)

Dec-2018 Dec-2017 Dec-2018 Dec-2017

2004-2009 31.59 25.94 4,001,696.00 3,604,809.00
2004-2017
2005-2010 29.26 23.58 125,901 97,723
2005-2011
2005-2013 28.07 24.75 510,071 537,377
2006-2011
2006-2014 - 24.16 - 74,932
2007-2012
2007-2013 29.67 25.62 697,593 551,268
2007-2014
2007-2015 29.89 23.37 153,687 218,514
2007-2016
2008-2013 31.13 25.13 304,425 241,968

29.51 23.31 773,832 694,210

28.86 23.04 87,044 66,036

28.68 23.25 283,829 211,467

30.38 20.48 57,731 38,921

26.33 22.87 285,449 436,550

27.40 22.33 418,860 346,175

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OTHER NOTES TO THE FINANCIAL STATEMENTS

2008-2014 28.34 22.32 66,717 49,195
2008-2015 26.79 20.72 79,121 55,064
2008-2017 29.33 25.43 69,455 54,098
2009-2014 26.89 23.37 92,416 83,776
2009-2015 31.76 26.07 15,403 12,643
2009-2016 26.07
2010-2015 - 16.92 - 4,073
2010-2016 26.81 23.21 23,458 49,373
2010-2017 27.77 22.84 79,852 61,614
2010-2018 29.16 21.72 55,814 42,112
2010-2019 25.83 22.85 49,945 47,780
2011-2016 29.22 19.78 65,486 51,209
2011-2017 24.59 21.62 446,388 306,455
2011-2018 29.88 21.05 41,478 30,022
2011-2019 29.26 19.12 54,133 38,947
2011-2020 20.85 15.31 61,504 43,498
2012-2017 19.60 17.38 37,235 26,019
2012-2018 23.91 15.05 113,689 67,856
2012-2021 24.63 22.59 19,951 11,193
2012-2022 26.54 10.54
2013-2018 15.34 7,961 6,777
2014-2019 - 12.73 - 8,868
2014-2022 22.04 12.31 151,266
2015-2020 19.92 261,680 77,252
2015-2022 18.87 6.88 155,264 2,419
2015-2023 16.74 5.71 46,143
2015-2024 15.03 5.19 3,708 11,989
2016-2021 14.50 4.71 142,164 1,870
2016-2025 5.28
2017-2022 7.05 4.14 34,574 110
2017-2023 8.92 4.03 5,228 61,104
2018-2026 5.34 3.91 627
2018-2023 6.35 1,655
5.43 - 138,373 12,654
4.01 - 5,875
4.18 781
26,573 -
1,087 -
201
8,537,765
14,490
9,869,968

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OTHER NOTES TO THE FINANCIAL STATEMENTS

(e) Provision for litigation arose from the assessment carried out by the Solicitors of the Bank of all the pending
litigations the Bank was involved in as at Dec 31, 2018. Please see Note 44 for further information on Litigations.

Movement in provision for litigation claims during the year is as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Opening Balance Dec-2018 Dec-2017 Dec-2018 Dec-2017
Reversal during the year
Reclassification1 178,710 - 178,710 -

(86,990) - (86,990) -

- 178,710 - 178,710

Closing Balance 91,720 178,710 91,720 178,710

1This relates to provision on pending cases that the bank was involved in which was initially recognised under Other Assets.

(f) Movement in impairment on contingents during the year is as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Additional impairment on initial application of IFRS 9 Dec-2018 Dec-2017 Dec-2018 Dec-2017
Reversal during the year
Closing Balance 6,741,958 - 6,741,958 -

358,931 - (28,830) -

7,100,889 6,713,128

40. Defined benefit obligations

The Bank operates a non-contributory, funded lump sum defined benefit gratuity scheme. Employees are automatically
admitted into the scheme after completing 10 consecutive years of service with the Bank. Employees’ terminal benefits
are calculated based on number of years of continuous service, limited to a maximum of 10 years. The defined benefit
obligation valuation was carried out by Alexander Forbes Consulting Actuaries.

(a) The amounts recognised in the statement of financial position are as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Present value of funded obligations (3,327,565) (2,976,569) (3,327,565) (2,976,569)
Total present value of defined benefit obligations (3,327,565) (2,976,569) (3,327,565) (2,976,569)
Fair value of plan assets 14,340,252 12,634,931 14,340,252 12,634,931
Present value of net asset/(obligations) 11,012,687 11,012,687
Recognized asset/(liability) for defined benefit obligations 11,012,687 9,658,362 11,012,687 9,658,362
9,658,362 9,658,362

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OTHER NOTES TO THE FINANCIAL STATEMENTS

The bank has a right to the surplus on its plan assets. There are no unrecognised actuarial gains and losses. The defined
benefit scheme is not open to asset ceiling, therefore, there is no need to determine any difference between net defined
benefit asset and asset ceiling. Recognised asset for defined benefit obligations is included within Restricted deposits
and other assets in note 34.

b. Movement in the present value of defined benefit obligations:

In thousands of Nigerian Naira Group Group Parent Parent
(Deficit)/surplus on defined benefit obligations, beginning of year Dec-2018 Dec-2017 Dec-2018 Dec-2017
Net (Expense) / Income recognised in Profit and Loss1 9,658,362 7,506,302 9,658,362 7,506,302
Re-measurements recognised in Other Comprehensive Income2 1,403,286 1,176,734 1,403,286 1,176,734
Contributions paid (238,928) 839,010 (238,928) 839,010
(Deficit)/surplus for defined benefit obligations, end of year
1Net (Expense) / Income recognised in Profit and Loss is analysed below: 189,967 136,316 189,967 136,316

11,012,687 9,658,362 11,012,687 9,658,362

In thousands of Nigerian Naira Group Group Parent Parent
Interest income on Net defined benefit obligationa Dec-2018 Dec-2017 Dec-2018 Dec-2017
Current service costs 1,232,986 1,472,056 1,232,986
1,472,056 (56,252) (68,770) (56,252)
1,176,734 1,403,286 1,176,734
(68,770)
Group Parent Parent
1,403,286 Dec-2017 Dec-2018 Dec-2017
aInterest income on Net defined benefit obligation is analysed below: 1,611,977 1,920,510 1,611,977
(378,991) (448,454) (378,991)
In thousands of Nigerian Naira Group 1,232,986 1,472,056 1,232,986
Interest income on assets Dec-2018
Interest cost on defined benefit obligation
1,920,510

(448,454)

1,472,056
2Remeasurements recognised in Other Comprehensive income is analysed below:

In thousands of Nigerian Naira Group Group Parent Parent
Return on plan assets, excluding amounts included in interest expense/income Dec-2018 Dec-2017 Dec-2018 Dec-2017
Effect of Exchange rate fluctuation (583,106) 1,037,941 (583,106) 1,037,941
Gain/(loss) from change in demographic assumptions
367,916 155,884 367,916 155,884

(23,738) (354,815) (23,738) (354,815)

(238,928) 839,010 (238,928) 839,010

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OTHER NOTES TO THE FINANCIAL STATEMENTS Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017
(c) Plan assets consist of the following:
3,339,627 4,131,173 3,339,627 4,131,173
In thousands of Nigerian Naira
1,961,403 1,295,360 1,961,403 1,295,360
Equity securities
- Quoted 1,080,000 2,909,629 1,080,000 2,909,629
Government securities
- Quoted 7,959,222 4,298,769 7,959,222 4,298,769
Offshore investments 14,340,252 12,634,931 14,340,252 12,634,931
- Quoted
Cash and bank balances Dec-2018 Dec-2017
- Unquoted
3,339,627 23% 4,131,173 33%
Group 1,961,403 14% 1,295,360 10%
1,080,000 2,909,629 23%
In thousands of Nigerian Naira 7,959,222 8% 4,298,769 34%
14,340,252 56% 12,634,931 100%
Equity securities 100%
Government securities
Offshore investments Dec-2018 Dec-2017
Cash and bank balances
3,339,627 23% 4,131,173 33%
Parent 1,961,403 14% 1,295,360 10%
1,080,000 2,909,629 23%
In thousands of Nigerian Naira 7,959,222 8% 4,298,769 34%
14,340,252 56% 12,634,931 100%
Equity securities 100%
Government securities
Offshore investments
Cash and bank balances

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OTHER NOTES TO THE FINANCIAL STATEMENTS

The defined benefit plan assets are under the management of Pension Fund Custodians - Crusader Sterling Pension
Limited.

The N3,339,627,000 equity investments of the scheme includes the Group’s ordinary shares with a fair value of
N3,121,095,000 (Dec 2017: N3,907,048,000). Additionally, out of the cash and bank balances of N7,959,222,000 , an
amount with a fair value of N7,642,731,000 (Dec 2017:N3,954,045,000) represents deposit with the Group.

Expected contributions to post-employment benefit plans for the year ending 31 December 2019 are N167,502,000
(December 2018: N189,967,000) while gratuity payments are estimated to be N167,502,000 (December 2018:
N189,967,000).

(d) Defined benefit cost for year ending December 2019 is expected to be as follows:

In thousands of Nigerian Naira Parent Parent
Dec-2019 Dec-2018

Current service cost 70,307 68,770

Net Interest on defined benefit liability (1,808,285) (1,470,063)

Expense/(Income) recognised in profit or loss (1,737,978) (1,401,293)

Components of net interest on defined benefit liability for the year ending December 2019 is estimated to be as
follows:

In thousands of Nigerian Naira Parent Parent
Dec-2019 Dec-2018

Interest cost on defined benefit obligation 543,516 450,447

Interest income on assets (2,351,801) (1,920,510)

Total net interest cost (1,808,285) (1,470,063)

Plan assets are valued at current market value. The expected return on plan assets is determined by considering the

expected returns available on the assets underlying the current investment policy. Expected yields on fixed interest

investments are based on gross redemption yields as at the date of the consolidated statement of financial position.

Expected returns on equity reflect long-term real rates of return experienced in the respective markets.





(e) Movement in plan assets:

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Fair value of plan assets, beginning of the year 12,634,931 9,829,129 12,634,931 9,829,129
Contributions paid into/(withdrawn from) the plan 189,967 136,316 189,967 136,316
Benefits paid by the plan
Actuarial gain (189,967) (136,316) (189,967) (136,316)
Return on plan assets (215,189) 1,193,825 (215,189) 1,193,825
Fair value of plan assets, end of the year 1,920,510 1,611,977 1,920,510 1,611,977
14,340,252 12,634,931 14,340,252 12,634,931

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Actual return on plan asset is made up of expected return on plan assets and actuarial gains / losses



(f) Movement in present value of obligations:

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Present value of obligation, beginning of the year 2,976,569 2,322,827 2,976,569 2,322,827
Interest cost 448,454 378,991 448,454 378,991
Current service cost 68,770 56,252 68,770 56,252
Benefits paid
Actuarial (gain) on obligation (189,967) (136,316) (189,967) (136,316)
Present value of obligation at end of the year 23,739 354,815 23,739 354,815

3,327,565 2,976,569 3,327,565 2,976,569

(g) Actuarial assumptions 2018 2017
Principal actuarial assumptions at the reporting date (expressed as weighted averages): 16.4% 15.2%
12.5% 10.0%
Discount rate 14.4% 12.5%
Salary increase rate 60 years 60 years
Inflation
Retirement age for both male and female 4.5% 4.5%
Withdrawal Rate: 18 – 29 6.0% 6.0%
Withdrawal Rate: 30 – 44 5.0% 5.0%
Withdrawal Rate: 45 – 50 4.5% 4.5%
Withdrawal Rate: 51 4.0% 4.0%
Withdrawal Rate: 52 3.5% 3.5%
Withdrawal Rate: 53 3.0% 3.0%
Withdrawal Rate: 54 2.5% 2.5%
Withdrawal Rate: 55 2.0% 2.0%
Withdrawal Rate: 56 1.5% 1.5%
Withdrawal Rate: 57 1.0% 1.0%
Withdrawal Rate: 58 0.5% 0.5%
Withdrawal Rate: 59 100.0% 100.0%
Withdrawal Rate: 60

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Assumptions regarding future mortality before retirement are based on A1949/52 ultimate table published by the
Institute of Actuaries of United Kingdom.
The overall expected long-term rate of return on assets is 16.4%. The expected long-term rate of return is based on the
portfolio as a whole and not on the sum of the returns on individual asset categories. The return is based entirely on
current market yields on Nigerian Government Bonds. The component of the rate of remuneration increase based on
seniority and promotion is an average of 12.5% per annum. The inflation component has been worked out at 14.4%
per annum.
For members in active service as at the valuation date, the projected unit credit method of valuation as required
under the IFRS has been adopted.

(h) Reasonably possible changes at the reporting date of discount rate, salary increase rate and mortality rate would
have affected the defined benefit obligation by the amounts shown below:

Group Impact on defined benefit obligation
Dec-2018
Change in Defined benefit obligation
In thousands of Nigerian Naira except percentages
Assumption Increase Decrease
Discount rate
Salary increase rate 1.00% (3,131,092) 3,546,989
Mortality rate
1.00% 3,558,762 (3,117,582)

1 year 3,330,247 (3,325,131)

Group Impact on defined benefit obligation
Dec-2017
Change in Defined benefit obligation
In thousands of Nigerian Naira except percentages
Assumption Increase Decrease
Discount rate
Salary increase rate 1.00% (2,795,685) 3,178,177
Mortality rate
1.00% 3,191,398 (2,781,344)
Parent
Dec-2018 1 year 2,980,401 (2,973,087)

In thousands of Nigerian Naira except percentages Impact on defined benefit obligation

Discount rate Change in Defined benefit obligation
Salary increase rate
Mortality rate Assumption Increase Decrease

#EnrichingLives 1.00% (3,131,092) 3,546,989

1.00% 3,558,762 (3,117,582)

1 year 3,330,247 (3,325,131)

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Parent Impact on defined benefit obligation
Dec-2017
Change in Defined benefit obligation
In thousands of Nigerian Naira except percentages
Assumption Increase Decrease
Discount rate
Salary increase rate 1.00% (2,795,685) 3,178,177
Mortality rate
1.00% 3,191,398 (2,781,344)

1 year 2,980,401 (2,973,087)

In practice, changing an actuarial assumption while holding other assumptions constant is unlikely to occur as changes
in some of the assumptions may be correlated.

(i) Expected maturity analysis of undiscounted pension and post-employment benefits:

In thousands of Nigerian Naira Less than 1 year Between 1-2 Between 2-5 Over 5 years Total
years years
Present value of the defined benefit 1,930 66,017,013 66,100,132
obligation 1,930 53,188 28,001 66,017,013 66,100,132
53,188 28,001

(j) Historical information Dec-2018 Dec-2017 Dec-2016 Dec-2015 Dec-2014
(3,303,826) (2,621,754) (3,613,593) (2,693,447) (2,099,823)
In thousands of Nigerian Naira 14,555,441 11,441,106
Present value of the defined benefit obligation 9,216,954 9,131,514 8,542,922
Fair value of plan assets (23,739) (354,815) 1,290,766 (484,967) (200,436)
Experience adjustments on plan liabilities (215,189) 1,193,825 (857,767) (595,564)
Experience adjustments on plan assets 11,012,687 9,658,362 612,175 5,095,333 5,647,099
Surplus/(deficit) 7,506,302

(k) Defined Benefit Risk Management Asset volatility

The Group’s exposure to risks through its defined benefit Post employment benefit obligations are calculated us-
plan is mitigated through a number of strategies. Most ing a discount rate determined with reference to market
important of them is the asset-liability matching strategy. yields on high quality bonds. The Group ensures that the
Thus, fluctuations in macro-economic variables have min- plan assets do not underperform this yield. This is achieved
imal impact on its exposure to the plan. through maintaining an efficient portfolio of investments
in plan assets significantly made up of high quality equities
Over the years, the Group not only ensures that it has and government securities.
sufficient plan assets to fund its defined benefit obligation
but also adopts a robust strategy that ensures that the Consequently, the yield on the Group’s plan assets has
macro-economic variables affecting the obligations are consistently outperformed interest cost on plan obliga-
similar to those of the plan assets. The significant risks tions. The Group also ensures that as tenured investments
inherent in the Group’s defined benefit plan are detailed in plan assets mature, they are replaced with top quality
below: investments which better match the liabilities.

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OTHER NOTES TO THE FINANCIAL STATEMENTS

duration, as compiled by the Debt Management Organ-
isation. A decrease in Nigerian Government Bond yields
Overall, the Group’s defined benefit investment strategy will increase the plan’s liabilities. However, this growth is
offset by an increase in the value of the plan assets.
aims at reducing investment risks while maintaining the
Inflation risk
right mix of investments in high quality equities, debt and
We believe this is less a material risk given the accretion
near cash instruments void of impairment threats. The to the Group’s plan assets arising from continuous contri-
bution to the plan and improved yield. Growth in infla-
choice of investment in equities stems from the long term tion, all other things being equal, should lead to increased
basic salaries (which is an important determinant of the
nature of the Group’s defined benefit plan and expected Group’s defined benefit liability) and consequently higher
plan liabilities.
maturity of the plan’s liabilities. This growth in liabilities should be offset with increased
plan assets.


Changes in bond yields



The rate used to discount post-employment benefit obli-

gations is determined with reference to market yields at

the balance sheet date on high quality corporate bonds.

In countries where there is no deep market in such bonds,

the market yields on government bonds are used. The

Group is of the opinion that there is no deep market in

Corporate Bonds in Nigeria and as such assumptions un-

derlying the determination of discount rate are referenced

to the yield on Nigerian Government bonds of medium

41 Other borrowed funds

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Due to IFC (see note (i) below) 59,940,225 77,341,263 59,940,225 70,757,740
Due to ADB (see note (ii) below) - 2,946,842 - 2,946,842
Due to FMO 2,076,854 - -
Due to BOI (see note (iii) below) 450,290
Due to CACS (see note (iv) below) 38,396,728 41,710,002 38,396,728 41,710,002
Due to Proparco (see note (v) below) 25,172,146 25,429,458 25,172,146 25,429,458
MSME Development Fund (see note (vi) below) 12,308,296 14,834,598 11,553,004 13,674,445
Excess Crude Account -Secured Loans Fund (see note (vii) below)
Due to DEG (see note (viii) below) 121,393 284,392 121,393 284,392
RSSF on lending (see note (ix) below) 14,219,713 14,547,930 14,219,713 14,547,930
SANEF Intervention Fund (see note (x) below) 18,546,673 18,546,673
NESF Fund (see note (xi) below) - 22,773,902 - 22,773,902
25,292,215 25,292,215
- -
1,000,000 - 1,000,000 -
1,665,794 220,491,914 1,665,794 210,671,384
178,566,800 177,361,218

Current 51,297,699 50,140,861 50,847,409 48,064,006
Non-current 127,269,101 170,351,053 126,513,809 162,607,378

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OTHER NOTES TO THE FINANCIAL STATEMENTS

i). The amount of N59,940,225,000 (USD167,062,000) iv). The amount of N25,172,146,000 (December 2017:
(December 2017: N70,757,740,000; USD N25,429,458,000) represents the outstanding bal-
213,666,000) represents the outstanding balance ance on the on-lending facilities granted to the Par-
on the Tranche 4 and Tranche 5 dollar term loan ent by the Central Bank of Nigeria in collaboration
granted to the Parent by the International Finance with the Federal Government of Nigeria (FGN) under
Corporation (IFC). The Tranche 4 facility was dis- the Commercial Agriculture Credit Scheme (CACS).
bursed in December 2011(USD 170,000,000) for a The FGN is represented by the Federal Ministry of
period of 8 years and the Tranche 5 was availed in Agriculture and Rural Development (FMARD) who
December 2014( USD 175,000,000) equally for a pe- has the aim of providing concessionary funding for
riod of 8 years. The principal amount is repayable agriculture so as to promote commercial agricultural
semi annually from December 2013 for Tranche 4 enterprises in Nigeria. The Facility is for a period of
and December 2016 for Tranche 5. The pricing of 7 years at 2% p.a cost to the Parent. The maximum
the Tranche 4 facility is 5.5% and Libor plus 4% for interest rate to the borrowers under the Scheme is
the Tranche 5. Interest is paid semi annually on the 9% p.a inclusive of all charges.
two tranches.

v). The amount of N11,553,004,000 (USD 32,200,000)
ii). The outstanding balance of N2,946,842,000 (USD
(December 2017: N13,674,445,000 ; USD
8,899,000) on the second tranche of the facility 41,293,000) represents the outstanding balance on
granted to the Parent by the African Development the facility granted to the Parent by PROPARCO,
Bank(ADB) matured during the period and was ful- the private sector financing arm of Agence Francais
ly paid. The first tranche was disbursed in August de Development(AfD). The facilities were disbursed
2007(USD 40,000,000) for a period of 5.5 years in two tranches with the first tranche in December
and was fully re-paid in February 2013. The second 2011 ( USD 50,000,000) and the second tranche
tranche (USD 90,000,000) was disbursed in February in January 2015( USD 50,000,000). The principal
2012 for a period of 6 years. The principal amount amount is repayable semi annually from January
on this was paid semi annually from August 2013. In- 2012 for the first tranche and April 2017 for the
terest was paid semi annually on the second tranche second tranche. Interest is paid on a semi-annual ba-
at 5.157%. sis with the first tranche priced at 4.46% and second
tranche at Libor plus 4.26%. The first tranche ma-
iii). The amount of N38,396,728,000 (December 2017: tured in January 2016 while the second tranche will
N41,710,002,000) represents the outstanding bal- mature in April 2022.
ance on the wholesale funding granted to the
Parent for the refinancing/restructuring of SME/ vi). The amount of N121,393,000 (December 2017:
Manufacturing loan portfolio under the Small and N284,392,000) represents the outstanding balance
Medium Enterprise Refinancing and Restructuring on the on lending facility granted by the Central
Fund (SMERRF) and to fastrack the development of Bank of Nigeria targeted at the growth and devel-
power projects and aviation sector so as to improve opment of the Micro, Small and Medium Scale sub
power supply, under the Power and Airline Inter- sector of the economy by providing single digit low
vention Fund ( PAIF). The SMERRF and PAIF are ad- interest rate funds. The facility is granted at an inter-
ministered at an all-in interest rate /charge of 7% est rate of 2% to the Parent . The maximum rate,
per annum payable on a quarterly basis. The Bank inclusive of all charges, to the eligible MSMEs is 9%
of Industry (BOI) is entitled to 1% management fee p.a. and the tenor of the facility ranges from 1 to 3
payable quarterly by the Parent. The Loans have a years depending on the type of enterprise.
maximum life of 15 years and/or working capital fa-
cility of one year with the provision for roll over sub-
ject to a maximum tenor of 5 years. The tenor of the vii). The amount of N14,219,713,000 (December 2017:
facilities as at the end of the period range between 5 N14,547,930,000) represents the outstanding bal-
years to 13 years. ance on the concessionary loans granted by the
Central Bank of Nigeria to State Governments for
the execution of developmental and infrastructure
projects. The facility is secured by the balance due to

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OTHER NOTES TO THE FINANCIAL STATEMENTS

State Governments from the Excess Crude Account. xi). The Non Oil Export Stimulation Facility (NESF) was
The facility is priced at 2% p.a payable on a monthly introduced by the Central Bank of Nigeria (CBN) to
basis. The loan is granted to the States at 9% p.a diversify the revenue base of the economy and pro-
inclusive of all charges. The principal is repayable mote growth of the non-oil export sector. The facility
monthly from the Federal Account Allocation Com- is granted at an all-inclusive interest rate of 9% p.a.
mittee(FAAC) allocation of those States as a first line payable on a quarterly basis. NESF can have a ten-
charge upon the issuance of an Irrevocable Standing or of up to 10 years not exceeding 31st December,
Payment Order(ISPO) by those States. The tenor of 2027 and the principal amount is repayable quarterly
the facility is 20 years. over the tenure of the facility.

viii). The facility granted to the Parent by DEG, a whol-
ly-owned subsidiary of KfW Group was fully paid
off during the period. The outstanding balance as
at December 2017 was N18,546,673,000 (USD
56,005,000). The facility was disbursed in December
2016 and repayable semi annually from July 2019.
Interest was priced at 5.4% p.a. plus 6-months USD
LIBOR.

ix). The amount of N25,292,215,000 (December 2017:
N22,773,902,000) represents the outstanding bal-
ance on the Real Sector Support Facility (RSSF). The
Facility is given by the Central Bank of Nigeria to
support large enterprises for startups and expansion
financing needs. The real sector activities targeted
by the Facility are manufacturing, agricultural value
chain and selected service sub-sectors. The Facility is
administered at an all-in Interest rate/charge of 9%
per annum payable on quarterly basis. The Central
Bank of Nigeria is entitled to earn 3% as interest
while the Bank makes a 6% Spread.

x). The Shared Agent Network Facility (SANEF) is an in-
tervention fund under the MSME Development Fund
to provide ten (10) year loans to CBN Licensed and
pre-qualified Mobile Money and Super- Agent op-
erators for the purposes of rolling out of a Shared
Agent Network. The objective of the Shared Agent
Network is to deepen financial inclusion in the coun-
try with the offering of basic financial services such
as Cash-in, Cash-out, Funds, Bills Payments, Airtime
Purchase, Government disbursements as well as re-
mote enrollment on BMS infrastructure (BVN). The
facility is for 10 years inclusive of a 2-year moratori-
um on principal and 1- year moratorium on Interest.
The facility is disbursed at a single digit, all-inclusive
interest rate of 5% per annum.

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OTHER NOTES TO THE FINANCIAL STATEMENTS Debt securities Long term Finance lease
issued borrowings 262,599
41b Reconciliation of Financial Liabilities 220,491,914 -
For the Year ended 31 December 2018 92,131,923 14,450,000
- (65,370,563) (284,509.00)
Group (9,390,710) -
Dec-2018 (99,008,757)
(5,961,669) 9,603,380 21,910
In thousands of Nigerian Naira 7,692,523 8,782,779 -
Opening Balance 5,145,980 178,566,800 -
Cash inflow - Principal -
Cash outflow - Principal
Cash outflow - Interest Debt securities Long term Finance lease
Effect of exchange rate fluctuation issued borrowings 1,675,041
Other non-cash 219,633,604
Closing Balance 126,237,863 (11,477,202) (1,513,030)
(41,374,839) -
Group (9,521,383)
Dec-2017 (7,730,482) 100,588
15,036,740 -
In thousands of Nigerian Naira 7,575,981
Opening Balance 6,820,155 262,599
Net Cash inflow/(outflow) - Principal 7,423,400
Net Cash outflow - Interest 220,491,914
Effect of exchange rate fluctuation 92,131,923
Other non-cash
Closing Balance Debt securities Long term Finance lease
issued borrowings 262,599
Parent 210,671,384
Dec-2018 92,131,923 14,450,000 (284,509)
- (56,015,226) -
In thousands of Nigerian Naira (8,739,635) -
Opening Balance (99,008,757)
Cash inflow - Principal (5,961,669) 8,862,991 21,910
Cash outflow - Principal 7,692,523 8,131,704 -
Cash outflow - Interest 5,145,980 177,361,218 -
Effect of exchange rate fluctuation -
Other non-cash
Closing Balance Guaranty Trust Bank Plc | 2018 Annual Report | 313

#EnrichingLives

OTHER NOTES TO THE FINANCIAL STATEMENTS

Parent Debt securities Long term Finance lease
Dec-2017 issued borrowings 1,675,041
- 332,317,881
In thousands of Nigerian Naira (4,380,047) (1,513,030)
Opening Balance (40,754,537) (5,819,611) -
Net Cash inflow/(outflow) - Principal (7,730,482)
Net Cash outflow - Interest 7,553,593 7,372,787 100,588
Effect of exchange rate fluctuation (125,639,949) -
Reclassification 125,639,949 -
Other non-cash 7,423,400 6,820,323
Closing Balance 210,671,384 262,599
92,131,923

42 Capital and reserves

Share capital

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to vote at

meetings of the Group. All ordinary shares and GDR shares rank pari-passu with the same rights and benefits at meet-
ings of the Group.

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017
(a) Authorised:
50,000,000,000 ordinary shares of 50k each 25,000,000 25,000,000 25,000,000 25,000,000
(31 December 2017: 50,000,000,000 of 50k each)

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017
(b) Issued and fully paid:
29,431,179,224 ordinary shares of 50 kobo each 14,715,590 14,715,590 14,715,590 14,715,590
(31 December 2017: 29,431,179,224 ordinary shares of 50k each)

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017
26,789,923,737 ordinary shares of 50k each
(31 December 2017: 26,519,639,837) 13,394,962 13,259,820 13,394,962 13,259,820

2,641,255,487 ordinary shares (GDR) of 50k each 1,320,628 1,455,770 1,320,628 1,455,770
(31 December 2017: 2,911,539,387) 14,715,590 14,715,590 14,715,590 14,715,590

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OTHER NOTES TO THE FINANCIAL STATEMENTS

The movement on the value of issued and fully paid-up share capital (Non GDR and GDR) account during the year
was as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Balance, beginning of year Dec-2018 Dec-2017 Dec-2018 Dec-2017
Balance, end of year
14,715,590 14,715,590 14,715,590 14,715,590

14,715,590 14,715,590 14,715,590 14,715,590

Share capital

Movement in the components of share capital is as shown below:

In thousands of Nigerian Naira Number of shares Ordinary shares Share premium Treasury shares
(thousands)
123,471,114 (5,291,245)
At January 2017 29,431,180 14,715,590 123,471,114 (5,291,245)

At 31 December 2017/1 January 2018 29,431,180 14,715,590 - (292,390)
123,471,114 (5,583,635)
(Purchases)/sales of treasury shares --

At 31 December 2018 29,431,180 14,715,590

Share premium
(ii) Small and medium enterprises equity invest-
Share premium is the excess paid by shareholders over the
ment reserve (SMEEIS): The SMEEIS reserve is
nominal value for their shares. maintained to comply with the Central Bank of Ni-
geria (CBN) requirement that all licensed banks set
Other regulatory reserves aside a portion of the profit after tax in a fund to be
The other regulatory reserve includes movements in used to finance equity investment in qualifying small
the statutory reserves and the small and medium en- and medium scale enterprises. Under the terms of
terprises equity investment reserve. the guideline (amended by CBN letter dated 11 July
2006), the contributions will be 10% of profit after
(i) Statutory Reserves: Nigerian banking regulations tax and shall continue after the first 5 years but banks’
contributions shall thereafter reduce to 5% of prof-
require the Bank to make an annual appropriation it after tax. However, this requirement is no longer
to a statutory reserve. As stipulated by S.16(1) of the mandatory. The small and medium scale industries
Banks and Other Financial Institution Act of 1991 equity investment scheme reserves are non-distrib-
(amended), an appropriation of 30% of profit after utable. Total SMEEIS reserves was N4,232,478,000
tax is made if the statutory reserve is less than paid- at the end of the year.
up share capital and 15% of profit after tax if the
statutory reserve is greater than the paid up share (iii) Treasury shares: Treasury shares in the sum
capital. of N5,583,635,000 (31 December 2017:
N5,291,245,000) represents the Bank’s shares held
In the current year, the bank appropriated by the Staff Investment Trust as at 31 December
N25,037,965,000 representing 15% of its Profit af- 2018.
ter tax to Statutory Reserves.
Total statutory reserves was N272,609,043,000 (iv) Fair value reserve: The fair value reserve includes
at the end of the year. the net cumulative change in the fair value of fair



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OTHER NOTES TO THE FINANCIAL STATEMENTS

value through other comprehensive income invest-
ments until the investment is derecognised or im- Therefore it has been recognised in Regulatory Risk
paired.
Reserve. The Parent’s total balance in Regulatory Risk
(v) Regulatory risk reserve: The regulatory risk re- Reserve is N4,361,913,000. The Bank transferred the
serves warehouses the difference between the im- sum of N2,089,953,000 to this Reserve during the
pairment balance on loans and advances as year.
determined in accordance with the provisions of Pru-
dential guidelines of Central Bank of Nigeria when (vi) Retained earnings: Retained earnings are the car-
compared with the assessment in line with the re- ried forward recognised income net of expenses plus
quirement of IFRS 9 Expected credit loss model. The current year profit attributable to shareholders.
key component of CBN Prudential Guidelines (PG) is
the setting aside of additional 2% provision on all (vii) Non-controlling interest
performing loans assessed under the PG. This 2% The analysis of non-controlling interest per subsidi-
provision is not required under IFRS 9. ary is as shown below:

GTB (Gambia) Limited Group Group Parent Parent
GTB (Sierra Leone) Limited Dec-2018 Dec-2017 Dec-2018 Dec-2017
GTB (Ghana) Limited
GTB Liberia % % ₦’000 ₦’000
GTB Kenya Limited 22.19 22.19 1,163,198 996,493
GTB Tanzania 16.26 15.76 1,575,155 1,169,853
517,808
2.03 2.03 690,769
0.57 0.57 47,049 32,531
30.00 30.00 7,884,888
30.00 30.00 8,025,001
932,289 881,030
11,482,603
12,433,461

Please refer to Note 46 for more information on the Group structure

(viii) Agri-Business/Small and Medium Enterprises Investment Scheme (AGSMEIS): The AGSMEIS is main-

tained to support the Federal Government’s effort at promoting Agricultural businesses and Small and Medium
Enterprises. Effective 2017 all Deposit Money Banks (DMBs) are required to set aside 5% of their Profit After
Tax for equity investment in permissible activities as stipulated in the scheme guidelines. The fund is domiciled
with CBN.


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OTHER NOTES TO THE FINANCIAL STATEMENTS

(ix) Other regulatory reserves breakdown

Dec-2018

In thousands of Nigerian Naira Statutory SMEEIS AGSMEIS Total
Reserves Reserves Reserves

Opening Balance 247,571,078 4,232,478 6,341,840 258,145,396

Total comprehensive income for the year:

Transfers for the year1 25,037,965 - 8,064,234 33,102,199

Total transactions with equity holders 25,037,965 - 8,064,234 33,102,199

Balance as at 31 December 2018 272,609,043 4,232,478 14,406,074 291,247,595

1The amount of N8,064,234,000 transferred into AGSMEIS reserves represents 5% of Dec 2017 PAT which was contributed into the Agri-Business/Small and Medium Enterprises Investment
Scheme (AGSMEIS) during the year.

Dec-2017

In thousands of Nigerian Naira Statutory SMEEIS AGSMEIS Total
Opening Balance Reserves Reserves Reserves 203,418,152
Total comprehensive income for the year: 199,185,674
Transfers for the year 4,232,478 - 54,727,244
Total transactions with equity holders 48,385,404 54,727,244
Balance as at 31 December 2017 48,385,404 - 6,341,840 258,145,396
247,571,078 - 6,341,840
4,232,478 6,341,840

43 Dividends

The following dividends were declared and paid by the Group during the year ended:

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Balance, beginning of year -- - -

Final dividend declared1 70,634,830 51,504,563 70,634,830 51,504,563

Interim dividend declared 8,829,354 8,829,354 8,829,354 8,829,354

Payment during the year (79,464,184) (60,333,917) (79,464,184) (60,333,917)
-
Balance, end of year - - -
1 This relates to the final dividend declared for the 2017 financial year.

The Bank during the year declared and paid an interim dividend of 30k per share.
Subsequent to the balance sheet date, the Board of directors proposed a final dividend of 245k per share (Dec 2017:
240k per share) on the issued ordinary shares of 29,431,179,224 of 50k each.

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OTHER NOTES TO THE FINANCIAL STATEMENTS

44 Contingencies

Claims and litigation
The Bank, in its ordinary course of business, is presently involved in 484 cases as a defendant (31 December 2017: 470)
and 426 cases as a plaintiff (31 December 2017: 427). The total amount claimed in the 484 cases against the Bank is es-
timated at N476.03 Billion and $39.68 Million (31 December 2017: N530.59 Billion and $132.80 Million) while the total
amount claimed in the 426 cases instituted by the Bank is N111.0 Billion (31 December 2017: N110.86 Billion). However,
the solicitors of the Bank are of the view that the probable liability which may arise from the cases pending against the
Bank is not likely to exceed N91.72 Million (31 December 2017: N178.71 Million). This probable liability has been fully
provided for by the Bank (please refer to Note 39).

Contingent liabilities and commitments Other contingent liabilities include transaction related
customs and performances bond and are, generally,
In common with other banks, the Group conducts business commitments to third parties which are not directly
involving transaction related bonds and indemnities. dependent on the customer’s creditworthiness.
Contingent liabilities and Commitments comprise
guarantees and letters of credit. Documentary credits commit the Group to make payments
to third parties on production of documents, which is usually
Nature of instruments reimbursed immediately by customers. The following tables
Guarantees and letters of credit are given as security to summarise the nominal amount of contingent liabilities and
support the performance of a customer to third parties. commitments with off-financial position risk.

As the Group will only be required to meet these obligations
in the event of the customer’s default, the cash requirements
of these instruments are expected to be considerably below
their nominal amounts.

Acceptances, bonds, guarantees and other obligations for the account of customers:

a. These comprise: Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017
In thousands of Nigerian Naira
Contingent liabilities: 386,386,612 433,620,435 362,816,565 414,229,702
Transaction related bonds and guarantees 386,386,612 433,620,435 362,816,565 414,229,702

Commitments: 46,922,591 51,861,890 22,059,650 22,369,921
Clean line facilities and letters of credit 7,742,322 8,890,842 - -
Other commitments
54,664,913 60,752,732 22,059,650 22,369,921

b. 63% (N228,695,679,000) of all the transaction related bonds and guarantees are collaterised (December 2017:
N204,244,780,000) while the balance of N134,120,884,000 (December 2017: N209,984,922,000) is non-
collaterized

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OTHER NOTES TO THE FINANCIAL STATEMENTS

45 The measurement category and the carrying amount of financial assets and liabilities in accordance with IAS 39
and IFRS 9 at 1 January 2018 are compared as follows:

Classification and measurement of financial instruments

Group

In thousands of Nigerian Naira IAS 39 IFRS 9

Measurement Carrying Measurement Carrying
category amount category amount

Financial assets Amortised cost 641,973,784 Amortised cost 641,668,276
Cash and bank balances FVPL 23,945,661 FVPL 23,945,661
Trading assets FVPL 2,839,078 FVPL 2,839,078
Derivatives
Investment securities: Available for sale 517,492,733 FVOCI 517,492,733
Amortised cost 96,466,598 Amortised cost 96,457,565
Pledged assets 58,976,175 58,976,175
Loans & advances to banks Available for sale 750,361 FVOCI 740,658
Loans & advances to customers Amortised cost Amortised cost
Restricted deposits & other assets Amortised cost 1,448,533,430 Amortised cost 1,303,858,153
Amortised cost 424,254,168 Amortised cost 424,147,629
Parent
IAS 39 IFRS 9
In thousands of Nigerian Naira
Measurement Measurement
category Carrying category Carrying
amount amount

Financial assets Amortised cost 455,296,196 Amortised cost 454,990,688
Cash and bank balances FVPL 16,652,356 FVPL 16,652,356
Trading assets FVPL 2,839,078 FVPL 2,839,078
Derivatives
Investment securities: Available for sale 453,089,625 FVOCI 453,089,625
Amortised cost 2,007,253 Amortised cost 1,998,220
Pledged assets
Loans & advances to banks Available for sale 58,961,722 FVOCI 58,961,722
Loans & advances to customers Amortised cost 43,480 Amortised cost 33,777
Restricted deposits & other assets Amortised cost Amortised cost
Amortised cost 1,265,971,688 Amortised cost 1,124,512,140
422,868,826 422,762,287

Introduction of IFRS 9 does not have any classification and measurement impact on the financial liabilities of the Group
and Bank. The carrying amounts were also not affected.

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Reconciliation of statement of financial position balances from IAS 39 to IFRS 9

The following table reconciles the carrying amount of financial assets, from their previous measurement category in accord-
ance with IAS 39 to their new measurement categories upon transition to IFRS 9 on 1 January 2018:

Group

IAS 39 carrying amount Remeasurements IFRS 9 carrying amount
31-Dec-17 1-Jan-18
In thousands of Nigerian Naira

Amortised cost 641,973,784 (305,508) 641,668,276
Cash and bank balances 96,466,598 (9,033) 96,457,565
Opening balance under IAS 39 750,361 (9,703) 740,658
Remeasurement: ECL allowance
Closing balance under IFRS 9 1,448,533,430 (144,675,277) 1,303,858,153
Investment securities - amortised cost 424,254,168 (106,539) 424,147,629
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9
Loans & advances to banks
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9
Loans & advances to customers
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9
Restricted deposits & other assets
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9

Fair value through profit or loss (FVTPL) 23,945,661 23,945,661
Trading assets 2,839,078 2,839,078
Opening balance under IAS 39
Closing balance under IFRS 9 517,492,733 517,492,733
Derivatives 58,976,175 58,976,175
Opening balance under IAS 39
Closing balance under IFRS 9

Fair value through other comprehensive income
(FVOCI)
Investment securities - FVOCI
Opening balance under IAS 39
Closing balance under IFRS 9
Pledged assets
Opening balance under IAS 39
Closing balance under IFRS 9

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Reconciliation of contingent balances from IAS 39 to IFRS 9

Group IAS 39 carrying amount Remeasurements IFRS 9 carrying amount
31-Dec-17 1-Jan-18
In thousan ds of Nige rian Naira Remeasurements
433,620,435 (305,508) 433,620,435
Transaction related bonds and guarantees (9,033) 51,861,890
(9,703) 8,890,842
Opening balance under IAS 39
(141,459,548) IFRS 9 carrying amount
Closing balance under IFRS 9 (106,539) 1-Jan-18

Clean line facilities and letters of credit 51,861,890 454,990,688
Opening balance under IAS 39 1,998,220
Closing balance under IFRS 9 33,777

Other commitments 8,890,842 1,124,512,140
Opening balance under IAS 39 422,762,287
Closing balance under IFRS 9
16,652,356
Parent IAS 39 carrying amount
31-Dec-17
In thousands of Nigerian Naira

Amortised cost 455,296,196
Cash and bank balances 2,007,253
Opening balance under IAS 39 43,480
Remeasurement: ECL allowance
Closing balance under IFRS 9 1,265,971,688
Investment securities - amortised cost 422,868,826
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9
Loans & advances to banks
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9
Loans & advances to customers
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9
Restricted deposits & other assets
Opening balance under IAS 39
Remeasurement: ECL allowance
Closing balance under IFRS 9

Fair value through profit or loss (FVTPL) 16,652,356
Trading assets
Opening balance under IAS 39
Closing balance under IFRS 9

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Derivatives 2,839,078 2,839,078
Opening balance under IAS 39
Closing balance under IFRS 9 453,089,625 453,089,625
58,961,722 58,961,722
Fair value through other comprehensive income
(FVOCI)
Investment securities - FVOCI
Opening balance under IAS 39
Closing balance under IFRS 9
Pledged assets
Opening balance under IAS 39
Closing balance under IFRS 9

Reconciliation of contingent balances from IAS 39 to IFRS 9

Parent IAS 39 carrying amount Remeasurements IFRS 9 carrying amount
31-Dec-17 1-Jan-18
In thousan ds of Nige rian Naira
414,229,702
Transaction related bonds and guarantees
414,229,702
Opening balance under IAS 39

Closing balance under IFRS 9

Clean line facilities and letters of credit 22,369,921
Opening balance under IAS 39
Closing balance under IFRS 9 22,369,921

Equity investments previously classified as available- Available-for-sale debt instruments classified
as FVOCI
for-sale 
Listed and unlisted bonds were reclassified from available
for sale to FVOCI, as the group’s business model is
achieved both by collecting contractual cash flows and
The group elected to present in OCI, changes in the fair selling of these assets. The contractual cash flows of these
investments are solely principal and interest.
value of all its equity investments previously classified as
The reclassifications of the financial instruments on
available-for-sale, because these investments are held as adoption of IFRS 9 did not result in any changes to
measurements.
long-term strategic investments that are not expected to

be sold in the short to medium term.

Reclassification from held-to-maturity to amortised
cost

State government bonds that would have previously been
classified as held-to maturity are now classified at amortised
cost. The group intends to hold the assets to maturity to
collect contractual cash flows and these cash flows consist
solely of payments of principal and interest on the principal
amount outstanding.



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OTHER NOTES TO THE FINANCIAL STATEMENTS

IFRS 9 Impact on Changes in Equity & Allowances for Financial Instruments on Initial Application of IFRS 9 on
January 1, 2018
The following table provides information on IFRS 9 impact on changes in Equity, i.e. retained earnings, and reconciles
the closing impairment allowance as at December 31 2017 for both the financial assets in accordance with IAS 39
and provisions for loan commitments and financial guarantee contracts in accordance with IAS 37 to the opening ECL
allowance determined in accordance with IFRS 9 as at January 1, 2018.

Group December 31, 2017 IFRS 9 Allowances IFRS 9 Impact on Retained
(IAS 39/IAS 37 & 20,580,397 Earnings & NCI as at Jan. 1,
In thousands of Nigerian Naira 58,993,103
Portfolio allowance / 12 months ECL - Stage 1 Regulatory requirement) 2018
Life Time ECL Not Credit Impaired - Stage 2 18,876,953 80,609,513
Individually impaired / Life Time ECL Credit Impaired - 52,324,173 1,703,444
- Stage 3 58,993,103
Regulatory Risk Reserve (RRR) / Reclassification of RRR 48,914,387 305,508
Placements 65,490,719 190,510 31,695,126
Corporate bond (13,166,546)
Treasury Bills: -
- 305,508
- FVOCI- Pledged 190,510
- FVOCI -
Bonds: - 7,960 7,960
- Amortized Cost 58,468 58,468
- FVOCI -
Other Assets - 9,033 9,033
Loan commitments and financial guarantee contracts - 1,398 1,398
issued 106,539 106,539
Total -
133,282,059 6,741,958 6,741,958
219,928,560 86,646,501

Parent December 31, 2017 IFRS 9 Allowances IFRS 9 Impact on Retained
(IAS 39/IAS 37 & 19,360,706 Earnings as at Jan. 1, 2018
In thousands of Nigerian Naira 57,921,195
Portfolio allowance / 12 months ECL - Stage 1 Regulatory requirement) 1,495,022
Life Time ECL Not Credit Impaired - Stage 2 17,865,684 72,143,516 57,921,195
Individually impaired / Life Time ECL Credit Impaired - 52,324,173
- Stage 3 29,728,863
Regulatory Risk Reserve (RRR) / Reclassification of RRR 42,414,653 305,508 (13,166,546)
Placements 65,490,719 190,510
Corporate bond 305,508
Treasury Bills: - 190,510
-
- FVOCI- Pledged 7,960 7,960
- FVOCI - 58,468 58,468
Bonds: -
- Amortized Cost 9,033 9,033
- FVOCI - 1,398 1,398
Other Assets - 106,539 106,539
Loan commitments and financial guarantee contracts -
issued 6,741,958 6,741,958
Total - 209,170,963 83,399,907
125,771,056

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OTHER NOTES TO THE FINANCIAL STATEMENTS

46. Group entities

The Group is controlled by Guaranty Trust Bank Plc “the ultimate Parent” (incorporated in Nigeria). The controlling interest
of Guaranty Trust Bank Plc in the Group entities is disclosed in the table below:

i Significant subsidiaries

Country of Ownership NCI Ownership NCI
incorporation interest Dec-18 interest Dec-17

Dec-18 Dec-17

1 Guaranty Trust Bank Gambia Limited Gambia 77.81% 22.19% 77.81% 22.19%
83.74% 16.26% 84.24% 15.76%
2 Guaranty Trust Bank Sierra Leone Limited Sierra Leone 98.32% 97.97%
100.00% 1.68% 100.00% 2.03%
3 Guaranty Trust Bank Ghana Limited Ghana 99.43% 0.00% 99.43% 0.00%
100.00% 0.57% 100.00% 0.57%
4 Guaranty Trust Bank UK Limited United Kingdom 70.00% 0.00% 70.00% 0.00%
70.00% 30.00% 70.00% 30.00%
5 Guaranty Trust Bank Liberia Limited Liberia 30.00% 30.00%
100.00% 100.00%
6 Guaranty Trust Bank Cote D’Ivoire S.A Cote D’Ivoire 0.00% 0.00%

7 Guaranty Trust Bank Kenya Limited Kenya

8 Guaranty Trust Bank Tanzania Limited Tanzania

Special purpose entity:

Staff Investment Trust Nigeria

ii Indirect investment in Subsidiaries Country of Ownership NCI Ownership NCI
incorporation interest Dec-18 interest Dec-17
1 Guaranty Trust Bank Rwanda Limited 32.80% 32.80%
2 Guaranty Trust Bank Uganda Limited Rwanda Dec-18 30.00% Dec-17 30.00%
Uganda
67.20% 67.20%

70.00% 70.00%

The subsidiaries and sub-subsidiaries of the Group are all involved in banking business only.
(a) GTB Gambia was incorporated in April 2001 and commenced operations in March 2002.
(b) GTB Sierra Leone was incorporated in September 2001 and commenced operations in January 2002.
(c) Guaranty Trust Bank (Ghana) was incorporated in October 2004 and commenced operations in March 2006.
(d) Guaranty Trust Bank (UK) Limited was incorporated in February 2007 and commenced operations in January

2008.
(e) Guaranty Trust Bank (Liberia) Limited was incorporated in September 2008 and commenced operations in March

2009.
(f) Guaranty Trust Bank (Cote D’Ivoire) is Guaranty Trust Bank Plc’s first subsidiary in Francophone West Africa. The Bank

was licensed by the Central Bank of Cote D’Ivoire to offer banking services to the Ivorian public and commenced
operations on April 16, 2012.
(g) The Group extended its regional presence in Africa in December 2013 by acquiring 70% stake in Fina Bank Limited,
a commercial bank incorporated in Kenya with subsidiaries in Uganda and Rwanda. The bank has been re-branded as
Guaranty Trust Bank Kenya Limited.
(h) Guaranty Trust Bank (Tanzania) was incorporated ozn July 14th 2016 and commenced operations in December 2017
to spread its delivery of superior financial services to its East African customers.

Significant restrictions
There are no significant restrictions (contractual or otherwise) on the Group’s ability to access or use the assets and settle
the liabilities of any member of the Group to the extent that regulation does not inhibit/prohibit the group from having
access, and in liquidation scenario, the Group’s liability will be limited to its level of investment in the entity .

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Non -controlling interest of significant subsidiaries
The following relates to accumulated non-controlling interest and profit or loss allocated to non-controlling interest for
significant subsidiaries for year ended 31 December, 2018:

Significant subsidiaries Principal place of Accumulated Profit or loss Allocated to
In thousands of Nigerian Naira business Non-controlling Interest Non-controlling Interest
1 Guaranty Trust Bank Gambia Limited
2 Guaranty Trust Bank Sierra Leone Ltd Gambia Dec-18 Dec-17 Dec-18 Dec-17
3 Guaranty Trust Bank Ghana Limited Sierra Leone
4 Guaranty Trust Bank Liberia Limited Ghana 1,163,198 996,493 176,984 253,300
5 Guaranty Trust Bank Kenya Limited Liberia
6 Guaranty Trust Bank Tanzania Limited Kenya 1,575,155 1,169,853 459,152 321,587
Tanzania
690,769 517,808 190,570 134,842

47,049 32,531 7,364 7,520

8,025,001 7,884,888 153,823 316,199

932,289 881,030 (199,581) (102,455)

47. Unconsolidated interests in structured entities

The table below describes the types of structured entities that the Group does not consolidate but in which it holds an
interest.

Name of the entity 3 Peat Investment Ltd

Percentage holding 70%

Nature of entity Hotel & Leisure

Purpose of investment Government-induced investment

Activities of entity Provision of hospitality services

Line item in SOFP Investment securities-FVOCI***

Loans granted N2,905,580,000 (Dec-2017: N2,546,139,404)

**Maximum exposure to loss N2,905,580,000 (Dec-2017: N2,546,139,404)

Source of Financing Equity financing and loans from financial institutions

** Maximum exposure comprises the cost of investment and total facilities granted at arm’s length to the entity.
***Fair Value through Other Comprehensive Income

The Bank does not provide financial support to the unconsolidated structured entity and has no plans to provide financial
support to the entity in the future. However, the bank extended loans to the entity in the normal course of business at
arm’s length.

The Bank does not have the rights to direct the entity to enter into, or veto any changes to transactions for the benefit of
the Bank. In addition, the bank does not exercise decision-making rights that give the bank the ability to direct the relevant
activities of the entity. Furthermore, there is no inter-change of personnel between the Bank and the entity. Likewise, the
Bank does not have any form of control or influence on decision making apparatus of the entity. Accordingly, the account
of the entity is not consolidated.

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OTHER NOTES TO THE FINANCIAL STATEMENTS

48. Related parties (c) Transactions with key management
personnel
(a) Related party transactions The Group’s key management personnel, and persons
Parties are considered to be related if one party has the connected with them, are also considered to be related
ability to control the other party or exercise influence parties. The definition of key management include the
over the other party in making financial and operational close family members of key personnel and any entity
decisions, or another party controls both. The definition over which they exercise control. The key management
includes subsidiaries, associates, joint ventures and the personnel have been identified as the Assistant General
Group’s pension schemes, as well as key management Managers, Deputy General Managers, General Managers,
personnel. Executive and Non-Executive directors of the Group. Close
family members are those family members who may be
(b) Subsidiaries expected to influence, or be influenced by that individual
Transactions between Guaranty Trust Bank Plc and in their dealings with Guaranty Trust Bank Plc and its
its subsidiaries also meet the definition of related subsidiaries.
party transactions. These transactions are eliminated
on consolidation, hence, they are not disclosed in the (d) Risk assets outstanding 31 December 2018
consolidated financial statements but are disclosed in the During the year the Bank granted various credit facilities
books of the Bank. to companies whose directors are also directors of
Guaranty Trust Bank Plc (Director Related) or related to
The Bank has receivables from GTBank Ghana, GTBank a Key Management Personnel (Insider Related) at rates
Cote D’Ivoire, and GTBank Tanzania to the tune of and terms comparable to other facilities in the Bank’s
N580,802,494, N34,816,065, N26,197,426 respectively portfolio. An aggregate of N179,316,000 (31 December
as at 31 December, 2018 (December 2017: GTBank UK in 2017:N631,288,000 ) was outstanding on these facilities
the sum of N2,278,115). The Bank also received interest at the end of the year. The bank earned a sum of
of N336,137,175 on its placement with GTBank UK. N52,566,000 (Dec 2017: N80,595,000) on insider related
facilities during the year. The outstanding balance and
status of performance of each facility is as shown below:

Name of company /individual Relationship Facility type Status Nature of Security Parent Parent
In thousands of Nigerian Naira Director Related Overdraft Performing Dec-2018 Dec-2017
Jaykay Pharmacy Ltd Term Loan Performing Mortgage Debenture
Mediabloc Consulting Nigeria Ltd. Insider Related Overdraft Performing 7,125 14,846
Contemporary Gifts Limited Insider Related Domiciliation; Personal 4,209 6,825
Performing Guarantee
Discovery House Mont.Sch. Ltd Insider Related Term Loan Performing - 14,895
School Kits Limited Performing All Asset Debenture, Personal
Downtown Hotel & Cat. Services Insider Related Time Loan Guarantee - 57,377
50,208 28,000
Olanrewaju Kalejaiye Director Related Term Loan Tripartite Legal Mortgage, 25,000
Insider Related Domiciliation, Personal Guar- -
Gt Mortgage/
Max Advance/ antee
Maxplus Term
Tripartite Legal Mortgage,
Loan Personal Guarantee

Tripartite Legal Mortgage,
Personal Guarantee

Performing Legal Mortgage, Domiciliation - 98,561

Hassan Ibrahim Director Related GT Mortgage Performing Legal Mortgage 58,230 115,200
Uzoewulu Lisa Obiageli Director Related Max Advance Performing Domiciliation - 1,081
Adebayo Adeola Director Related Performing - 1,000
Agusto, Olabode Mubasheer Director Related Bid Bond Performing Cash In Pledged Funds
Fola Adeola Director Related Term Loan Performing Legal Mortgage 59,544 74,511
Overdraft - 193,992
Tripartite Equitable Mortgage 631,288
179,316

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OTHER NOTES TO THE FINANCIAL STATEMENTS

(e) Director/insiders related deposit liabiilties

Name of company/Individual Relationship Type of Deposit Parent Parent
In thousands of Nigerian Naira Director Related Demand Deposit Dec-2018 Dec-2017
Agusto & Co. Limited Director Related Demand Deposit
Alliance Consulting Director Related Demand Deposit 38,122 33,721
Comprehensive Project Mgt. Services Director Related Demand Deposit 167 939
Cubic Contractors Limited Director Related Demand Deposit
Eterna Plc Director Related Demand Deposit 34,468 18,358
IBFC Limited Director Related Demand Deposit 2,194 2,189
Jaykay Pharmacy Limited Director Related Demand/Time Deposits
Kresta Laurel Limited Director Related Demand Deposit 74,966 16,176
Main One Cable Company Ltd Director Related Demand/Time Deposits 50 50
WSTC Financial Services Ltd Director Related Demand Deposit 9 9
WSTC Nominee Limited Director Related Demand Deposit
Wstc Securities Limited Director Related Demand Deposit 226,053 100,260
International Travel Express Ltd Insider Related Demand Deposit 814 24,715
Mediabloc Consulting Nigeria Ltd. Insider Related Demand Deposit
Adam And Eve Nigeria Limited Director Related Demand Deposit 150,273 138,539
Polystyrene Industries Ltd Director Related Demand/Time Deposits 431 431
Touchdown Travels Limited Insider Related Demand Deposit
Discovery House Mont.Sch. Ltd Director Related Demand Deposit 66,038 12,216
Agbaje, Olufemi Augustus Director Related Demand Deposit 15 15
Adeola Razack Adeyemi Director Related Demand Deposit 9 44
IBFC Alliance Insider Related Demand Deposit -
Contemporary Gifts Limited Director Related Demand Deposit 157
Fcsl Asset Mgt Company Ltd Director Related Demand Deposit 2,663 4,507
Ithena Logic Limited Insider Related Demand Deposit 19,569 15,322
School Kits Limited Insider Related Demand Deposit 9,073
Uzoewulu, Lisa Obiageli Director Related Demand Deposit - 14,930
Adeola Fola Director Related Demand Deposit 21,155 28,647
Hassan Ibrahim Director Related Demand Deposit 21,271 2,155
Agusto, Olabode Mubasheer Director Related Demand Deposit
Downtown Hotel & Cat. Services Insider Related Demand Deposit 265 35
Kalejaiye, Olanrewaju Oluwatoyin - 11,393

4,160 1
1 863

3,545 31
23 238,237

265,675 3,606
1,185 4,520
1,799
158 996
- 7,335
689,470
935,078

Interest expense on insider related deposits was N25,422,000 (Dec 2017: N17,196,000) during the year.

(f) Subsidiaries’ deposit account balances

Name of company/Individual Relationship Type of Deposit Dec-2018 Dec-2017
In thousands of Nigerian Naira

GTB Sierra Leone Subsidiaries Domicilliary 1,328 1,226
GTB Ghana Subsidiaries Demand Deposit 3,462 3,462
GTB Ghana Subsidiaries 42,548 39,272
Domicilliary 47,338 43,960
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OTHER NOTES TO THE FINANCIAL STATEMENTS

(g) Connected Lending
The Bank has Loan exposure in the sum of N8.49bn to Forillion Transatlantic Limited, an unconsolidated SME

investment where the Bank has 80% shareholding.

(h) Key management personnel and their immediate relatives engaged in the following
transactions with the Group during the year:

L oans a nd adv ances:

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Secured loans 179,316 631,288 179,316 631,288

Deposits: Group Group Parent Parent
Dec-2018 Dec-2017 Dec-20178 Dec-2017
In thousands of Nigerian Naira
Total deposits 935,078 689,470 935,078 689,470

Interest rates charged on balances outstanding are at rates that would be charged in the normal course of business. The
secured loans granted are secured over real estate, equity and other assets of the respective borrowers. No impairment
losses have been recorded against balances outstanding during the period with key management personnel, and no
specific allowance has been made for impairment losses on balances with key management personnel and their immediate
relatives at the year end.

(i) Key management personnel compensation for the year comprises:

In thousands of Nigerian Naira Group Group Parent Parent
Dec-2018 Dec-2017 Dec-2018 Dec-2017

Wages and salaries 1,749,832 1,894,563 1,541,903 1,590,207
Post-employment benefits 68,170 54,013 68,170 54,013
Share-based payments
Increase /(decrease) in share appreciation rights 1,552,765 218,733 1,224,789 218,733
790,583 329,800 - -
2,497,109
4,161,350 2,834,862 1,862,953

(j) (i) Directors’ remuneration
Directors’ remuneration excluding pension contributions and certain benefits was provided as follows:

In thousands of Nigerian Naira Group Group Parent Parent
Fees as directors Dec-2018 Dec-2017 Dec-2018 Dec-2017
Other allowances
376,065 322,758 24,500 21,500
Executive compensation
209,905 556,536 209,400 248,080

585,970 879,294 233,900 269,580

806,202 698,917 806,202 689,245
1,392,172 1,578,211 1,040,102 958,825

(ii) The directors’ remuneration shown above includes: Parent Parent
Dec-2018 Dec-2017
In thousands of Nigerian Naira
Chairman 26,367 35,870
Highest paid director
384,157 224,157

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OTHER NOTES TO THE FINANCIAL STATEMENTS

(iii) The emoluments of all other directors fell within the following ranges:

N 6,500,001 - N11,000,000 Parent Parent
N11,500,001 - N12,000,000 Dec-2018 Dec-2017
N13,000,001 - N13,500,000
N13,500,001 - N22,500,000 1 1
Above N22,500,001
- -

- -

- -

14 14

15 15

49. Contraventions AMOUNT
N2,000,000
INFRACTION N14,000,000
2016 FX examination findings -CBN SMIS N6,000,000
2016 & 2017 Risk Based Examination findings N2,000,000
CBN Spot Check Examination
Breach of Credit Limit

50. Subsequent events

Aside from the final dividend of N2.45k per share declared by the Board of Directors, there were no other events
subsequent to the financial position date which require adjustment to, or disclosure in, these financial statements.

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OTHER NOTES TO THE FINANCIAL STATEMENTS

51. Restatement of comparative financial information

Prior period corresponding balances
Certain prior period balances have been reclassified in line with IAS 8 – Accounting Policies, Changes in Accounting
Estimates and Errors, to reflect change in accounting estimate:

Reported Restatements Restated Reported Restatements Restated
Group Parent Parent Parent
Group Group 2017
Dec-2017 Dec-2017 Dec-2017
In thousands of Nigerian Naira Dec-2017 2017

Assets 641,973,784 - 641,973,784 455,296,196 - 455,296,196
Cash and cash equivalents 23,945,661 - 23,945,661 16,652,356 - 16,652,356
Financial assets held for trading 2,839,078 - 2,839,078 2,839,078 - 2,839,078
Derivative financial assets
Investment securities: 517,492,733 - 517,492,733 453,089,625 - 453,089,625
– Available for sale 96,466,598 - 96,466,598 2,007,253 - 2,007,253
– Held to maturity 58,976,175 - 58,976,175 - 58,961,722
Assets pledged as collateral 750,361 - 750,361 58,961,722 - 43,480
Loans and advances to banks - 1,448,533,430 43,480 - 1,265,971,688
Loans and advances to customers 1,448,533,430 - 444,946,897 - 433,528,669
Other assets 444,946,897 -- 1,265,971,688 - 46,207,004
Investment in subsidiaries - - 98,669,998 433,528,669 - 84,979,798
Property and equipment 98,669,998 - 14,834,954 46,207,004 - 4,501,296
Intangible assets 14,834,954 - 1,666,990 84,979,798 --
Deferred tax assets 1,666,990 - 3,351,096,659 4,501,296 - 2,824,078,165
-
Assets classified as held for sale and 3,351,096,659 -- - 850,820
discontinued operations - 3,351,096,659 2,824,078,165 - 2,824,928,985
Total assets -
3,351,096,659 850,820
2,824,928,985

Liabilities 85,430,514 - 85,430,514 42,360 - 42,360
Deposits from banks 2,062,047,633 - 2,062,047,633 1,697,560,947 - 1,697,560,947
Deposits from customers - -
Financial liabilities held for trading 2,647,469 - 2,647,469 2,647,469 - 2,647,469
Derivative financial liabilities 2,606,586 5,767,585 2,606,586 2,606,586 5,767,585 2,606,586
Other liabilities 218,349,244 - 224,116,829 197,251,819 - 203,019,404
Current income tax liabilities 24,147,356 - 24,147,356 24,009,770 - 24,009,770
Deferred tax liabilities 18,076,225 - 18,076,225 12,814,766 - 12,814,766
Debt securities issued 92,131,923 - 92,131,923 92,131,923 - 92,131,923
Other borrowed funds 220,491,914 5,767,585 220,491,914 210,671,384 5,767,585 210,671,384
2,725,928,864 2,731,696,449 2,239,737,024 2,245,504,609
Liabilities included in assets -
classified as held for sale and - - - 847,600 5,767,585 847,600
discontinued operations 2,725,928,864 5,767,585 2,731,696,449 2,240,584,624 2,246,352,209
Total liabilities

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OTHER NOTES TO THE FINANCIAL STATEMENTS

Statements of financial position (Continued)
As at 31 December 2018

Reported Restatements Restated Reported Restatements Restated
Group Parent Parent Parent
Group Group 2017
Dec-2017 Dec-2017 Dec-2017
In thousands of Nigerian Naira Dec-2017 2017

Equity 14,715,590 - 14,715,590 14,715,590 - 14,715,590
Capital and reserves attributable 123,471,114 - 123,471,114 123,471,114 - 123,471,114
to equity holders of the parent - -
entity (5,291,245) (5,767,585) (5,291,245) - (5,767,585) -
Share capital 128,386,206 - 122,618,621 115,361,824 - 109,594,239
Share premium 352,403,527 (5,767,585) 352,403,527 330,795,833 (5,767,585) 330,795,833
Treasury shares 613,685,192 - 607,917,607 584,344,361 - 578,576,776
Retained earnings (5,767,585) (5,767,585)
Other components of equity 11,482,603 - 11,482,603 - - -
625,167,795 619,400,210 584,344,361 578,576,776
Non-controlling interests in equity 3,351,096,659 3,351,096,659 2,824,928,985 2,824,928,985
Total equity
Total equity and liabilities

The reported changes relate to the inclusion of contingent assets in the basis for calculating AMCON levy.
N2,556,975,000 of the figure relates to prior year while the balance relates to 2016 financial year.
The amounts have been recognised as payable to the Central Bank of Nigeria and deduction from the Retained Earnings.



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OTHER NOTES TO THE FINANCIAL STATEMENTS

In thousands of Nigerian Naira Reported Restatements Restated Reported Restatements Restated
Interest income Group Group Group Parent Parent Parent
Interest expense
Net interest income Dec-2017 Dec-2017 Dec-2017 Dec-2017 Dec-2017 Dec-2017
Loan impairment charges 327,333,512 - 327,333,512 284,442,547 - 284,442,547
Net interest income after loan impairment charges (80,670,351) - (80,670,351) (66,792,928) - (66,792,928)
Fee and commission income 246,663,161 - 246,663,161 217,649,619 - 217,649,619
Fee and commission expense (12,169,120) - (12,169,120) (10,834,612) - (10,834,612)
Net fee and commission income 234,494,041 - 234,494,041 206,815,007 - 206,815,007
Net gains/(losses) on financial instruments classified as held for trading - -
Other income 42,921,857 - 42,921,857 30,048,147 - 30,048,147
Other income (2,189,661) - (2,189,661) (1,561,766) - (1,561,766)
Total operating income 40,732,196 - 40,732,196 28,486,381 - 28,486,381
Net impairment loss on financial assets 11,338,819 - 11,338,819 -
Net operating income after net impairment loss on financial assets 37,632,083 - 37,632,083 6,542,636 - 6,542,636
Personnel expenses 48,970,902 - 48,970,902 39,203,978 - 39,203,978
Operating lease expenses 324,197,139 - 324,197,139 45,746,614 - 45,746,614
Depreciation and amortization - 281,048,002 - 281,048,002
Other operating expenses1 (696,680) - (696,680) -
Total expenses 323,500,459 - 323,500,459 (696,680) - (696,680)
Profit before income tax (32,832,341) - (32,832,341) 280,351,322 - 280,351,322
Income tax expense (22,354,351) (22,354,351)
Profit for the year (1,596,413) (2,556,975) (1,596,413) (2,556,975)
(15,383,697) (2,556,975) (15,383,697) (654,665) (2,556,975) (654,665)
(73,445,988) (2,556,975) (76,002,963) (13,042,425) (2,556,975) (13,042,425)
(123,258,439) (125,815,414) (58,095,277) (60,652,252)
200,242,020 - 197,685,045 (94,146,718) - (96,703,693)
(29,772,387) (2,556,975) (29,772,387) 186,204,604 (2,556,975) 183,647,629
170,469,633 167,912,658 (24,919,924) (24,919,924)
161,284,680 158,727,705

1Other operating expenses: The restatement of prior year largely resulted from the inclusion of contingents assets as part of total assets for the purpose of determining AMCON charge by the Central Bank of Nigeria which was retrospectively applied to 2016 and 2017 financial years.

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REGULATORY
REQUIREMENT
UNDER THE IFRS
REGIME

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REGULATORY REQUIREMENTS UNDER THE IFRS REGIME

Regulatory Requirements under the IFRS Regime The bank’s provisioning benchmark for ‘loans other than
In addressing the challenges faced by the Nigerian specialized loans’ is highlighted in the table below:
Banking industry which was at the brink of a crisis as a
result of spiral effects of the global financial meltdown, No of Days Overdrawn Classification % Provision
the CBN undertook a review of the prudential guidelines. taken
In the revised guidelines, which became effective 1st of 90 – 180 Substandard
July, 2010, the CBN provided for the adaptation of the 180 – 360 Doubtful 10
prudential guidelines to IFRS after it has been adopted Over 360 Lost
in Nigeria. Paragraph 12.4 of the revised Prudential 50
Guidelines for Deposit Money Banks in Nigeria stipulates
that Banks would be required to make provisions for 100
loans as prescribed in the relevant IFRS Standards when
IFRS is adopted. However, Banks would be required to As soon as an account is classified as non-performing,
comply with the following: the interest is accounted for on non-accrual basis i.e.
(a) Provisions for loans recognized in the profit and interest is not recognized as income but suspended.

loss account should be determined based on the Furthermore, if the occurrence of a loss event is certain,
requirements of IFRS. However, the IFRS provisions appropriate provisions will be made regardless of the
should be compared with provisions determined fact that such loans does not fall in any of the above
under prudential guidelines and the expected categories.
impact/changes in general reserve should be treated
as follows: 2. Specialized Loans
i. Prudential Provisions is greater than IFRS The provisioning policy for specialized loans covers the
following:
provisions; transfer the difference from the i. Agriculture Finance
general reserve to a non-distributable regulatory ii. Mortgage Loan
reserve. iii. Margin Loan
ii. Prudential Provisions is less than IFRS provisions; iv. Project Finance
the excess charges resulting should be v. Object Finance
transferred from the regulatory reserve account vi. SME Loan
to the general reserve to the extent of the non- vii. Real Estate Loan (Commercial and Residential)
distributable reserve previously recognized.
(b) The non-distributable reserve should be classified
under Tier 1 as part of core capital.
The group has fully complied with the requirements of
the guidelines.
Provisioning as recommended by Prudential Guide-
line
Loan provisioning is segregated along two (2) categories
as detailed below:
1. Loans other than Specialized Loans
The provisioning policy for ‘loans other than
specialized loans’ covers the following:
i. Commercial Loans
ii. Commodities Financing
iii. Corporate Loans
iv. Retail & Consumer Credits
v. Facilities granted to Federal, State and Local
governments and their parastatals.
vi. Facilities not specifically classified as specialized loans
by the CBN.

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REGULATORY REQUIREMENTS UNDER THE IFRS REGIME

The bank’s provisioning benchmarks are spelt out below under each of the specialized loan types:
i. Agriculture Finance
a. Agriculture Finance - short term facilities (purchase of seeds, fertilizers, WC, and other Inputs)

Category Classification Days past due % provision
1 Watchlist Markup / interest or principal past due by 90days 0% of total outstanding balance
1A Substandard Markup / interest or principal past due by 90days 25% of total outstanding balance
to 1year
2 Doubtful Markup / interest or principal past due by 1 to 50% of total outstanding balance
1.5 years
3 Very Doubtful Markup / interest or principal past due by 1.5 to 75% of total outstanding balance
2 years
4 Lost Markup / interest or principal past due by more 100% of total outstanding balance
than 2 years

b. Agriculture Finance – long term facilities (Farm development finance, purchase of machinery, livestock financing)

Category Classification Days past due % provision
1 Watchlist Markup / interest or principal past due by 90days 0% of total outstanding balance
1A Substandard Markup / interest or principal past due by 90days 25% of total outstanding balance
to 1year
2 Doubtful Markup / interest or principal past due by 1 to 50% of total outstanding balance
2years
3 Very Doubtful Markup / interest or principal past due by 2 to 3 75% of total outstanding balance
years
4 Lost Markup / interest or principal past due by more 100% of total outstanding balance
than 3 years

ii. Mortgage Loans

Category Classification Days past due Treatment of % provision
Unrealised Markup
1 Watchlist Markup / Interest or principal past / Interest income 0% of total outstanding
due by more than 90 days Suspend balance
10% of total outstanding
2 Substandard Markup / interest or principal past Suspend balance
due by more than 180days Un-provided balance should
Suspend not exceed 50% of NRV of
3 Doubtful Markup / interest or principal past security.
due by more than 1year Suspend 100% of total outstanding
balance
4 Lost Markup / interest or principal past
due by more than 2 years

iii. Margin Loans
The shares backing margin facilities shall be marked to market on a daily basis in order to determine the potential
loss in the portfolio. Provisions shall be made periodically for the excess of loan balance over the market value ofthe
underlining shares. Any increase in the mark to market value from the previous valuation shall be recognized to the
extent of the previous charge-off made.

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REGULATORY REQUIREMENTS UNDER THE IFRS REGIME

iv. Project Finance

Category Classification Days past due Treatment of % provision
1 Watchlist Income 0% of total
1A Substandard Repayment on obligation between outstanding balance
2 Doubtful 60% and 75% of amount due or Suspend interest and
3 Very Doubtful installment 180days past due realize on cash basis
4 Lost Repayment below 60% of amount
due or installment btw 180days to As above 25% of total
2years past due outstanding balance
Repayment below 60% of amount or
installment overdue by 2 to 3 years As above 50% of total
Repayment below 60% of amount As above outstanding balance
due or installment overdue by 3 to 4 75% of total
years outstanding balance
Repayment below 60% of amount
due or installment overdue by more As above 100% of total
than 4 years outstanding balance

v. Object Finance

Category Classification Days past due Treatment of % provision
1 Watchlist Income 0% of total
1A Substandard Repayment on obligation between outstanding balance
2 Doubtful 60% and 75% of amount due or Suspend interest and
3 Very Doubtful installment 180days past due realize on cash basis
4 Lost Repayment below 60% of amount
due or installment btw 180 to 1year As above 25% of total
past due outstanding balance
Repayment below 60% of amount or
installment overdue by 1 to 2 years As above 50% of total
Repayment below 60% of amount As above outstanding balance
due or installment over due by 2 to 3 75% of total
years outstanding balance
Repayment below 60% of amount
due or installment overdue by more As above 100% of total
than 3 years outstanding balance

vi. SME Loan
a. SME Loan - SME short term facilities (Maturities of 1 year)

Category Classification Days past due % provision
1 Watchlist Markup / interest or principal past due by 90days 0% of total outstanding balance
1A Substandard Markup / interest or principal past due by 90days 25% of total outstanding balance
to 1year
2 Doubtful Markup / interest or principal past due by 1 to 50% of total outstanding balance
1.5 years
3 Very Doubtful Markup / interest or principal past due by 1.5 to 75% of total outstanding balance
2 years
4 Lost Markup / interest or principal past due by more 100% of total outstanding balance
than 2 years

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REGULATORY REQUIREMENTS UNDER THE IFRS REGIME

b. SME Loan - SME Long term facilities (Maturities of more than 1 year)

Category Classification Days past due % provision
1 Watchlist Markup / interest or principal past due by 90days 0% of total outstanding balance
1A Substandard Markup / interest or principal past due by 90days 25% of total outstanding balance
to 1year
2 Doubtful Markup / interest or principal past due by 1 to 50% of total outstanding balance
2years
3 Very Doubtful Markup / interest or principal past due by 2 to 3 75% of total outstanding balance
years
4 Lost Markup / interest or principal past due by more 100% of total outstanding balance
than 3 years

vii. Real Estate Loan (Commercial and Residential)

Category Classification Days past due Treatment of In- % provision
1 Watchlist come
1A Substandard Repayment on obligation between
2 Doubtful 60% and 75% of amount due or Suspend interest and 0% of total
3 Very Doubtful installment 180days past due realize on cash basis outstanding balance
4 Lost Repayment below 60% of amount
due or installment btw 180 to 1year As above 25% of total
past due outstanding balance
Repayment below 60% of amount or
installment overdue by 1 to 2 years As above 50% of total
Repayment below 60% of amount As above outstanding balance
due or installment over due by 2 to 3 75% of total
years outstanding balance
Repayment below 60% of amount
due or installment overdue by more As above 100% of total
than 3 years outstanding balance

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STATEMENT OF
PRUDENTIAL
ADJUSTMENT

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STATEMENT OF PRUDENTIAL ADJUSTMENT

The Bank transferred a sum of N2,089,958,000 from its retained earnings to a non-distributable regulatory risk reserve
within the Statement of Changes in Equity in the year.The reassessed CBN recommended provision as at December 31,
2018 amounted to N95,666,736,000. Of the amount recommended by the Central Bank of Nigeria, N21,462,240,000
relates to 2% General Loan Loss Provision on performing loans and N384,268,000 relates to Other Known Losses.
Regulatory risk reserve represents the difference between the Central Bank of Nigeria (CBN) recommended Provision
for Loan Losses under the Prudential Guideline and the Loan Impairment allowance determined in accordance with
provisions of IFRS. The total regulatory risk reserve stood at N4,361,913,000 at the end of the year.
The Reconciliation between the CBN Recommended provisions and that under IFRS as at December 2018 is as shown
in the table below:

In thousands of Nigerian Naira Reference Specific General Total
a Loans and Advances:
73,820,228 21,462,240 95,282,468
Provision per CBN Prudential Guidelines (Notes 28 & 29) (90,984,448) - (90,984,448)

Impairment allowance per IFRS 9: (17,164,220) 21,462,240 4,298,020
(Stages 1,2,3)
Amount required in Regulatory Risk
Reserve1

b Provision for Other Known Losses: 384,268
Provision for Other Known Losses – CBN recommended (A) 320,375
Provision for Other Assets on the Book (Note 34) (B)
Amount required in Regulatory Risk Reserve (A-B) 63,893

1Regulatory Risk Reserve refers to the difference between the Provision assessment under CBN Prudential Guideline and impairment assessment
under IFRS.

c Impairment of loans and advances and Other Known Losses (OKL)

Regulatory reserve required for loans and advances 4,298,020
63,893
Regulatory reserve required for Other Known Losses
4,361,913
Balance required per Regulatory Risk Reserve (2,271,955)

Balance currently on Regulatory Risk Reserve (SOCIE-Page 87) 2,089,958

Amount to be transferred to regulatory risk reserve

d Movement in Regulatory Reserves Specific General Others Total
43,390,378 23,981,770 390,531 67,762,679
Balance as at 1 January (43,390,378) (21,709,815) (390,531) (65,490,724)
Impact of IFRS 9 adoption
Additional amount required - 2,026,065 63,893 2,089,958
Balance, end of the year - 4,298,020 63,893 4,361,913

The regulatory risk reserve for the Group as at December 2018 was N4,429,116,000.

#EnrichingLives Guaranty Trust Bank Plc | 2018 Annual Report | 339

ECL COVERAGE
RATIOS

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ECL COVERAGE RATIOS

The ECL Coverage ratio of each stage of the Bank’s financial instruments as at December 31, 2018 is presented below in line with CBN’s circular referenced BSD/DIR/GEN/
LAB/11/027 on Transitional Arrangements Treatment of IFRS 9

Gross Carrying Amount ECL Provision ECL Coverage Ratio
Stage 2 Stage 3
Financial statements items Stage 1 Stage 2 Stage 3 Total Stage 1 Stage 2 Stage 3 Total Stage 1 %% Total
₦'000 ₦'000 % %
₦'000 ₦'000 ₦'000 ₦'000 ₦'000 ₦'000
- - 0.00%
On-balance sheet items: 115,080 115,080 0.04%
5.47%
Cash and balances with central banks 47,484,035 - - 47,484,035 39 -- 2,664 0.00% 0.00% 0.00% 7.85%
5,179,281 -- 90,981,784 0.04% 0.00% 0.00% 0.24%
Placements and other short term 291,334,276 - - 291,334,276 - 2,625 0.11% 0.00% 18.11% 0.06%
investments 4,865 11,134,508 74,667,995 4,865 0.55% 8.13% 89.35%
34,237 3 14,498 48,738 283,470 -- 283,470 0.24% 0.00% 0.00% 0.06%
Loans and advances to banks at -- 0.06% 0.00% 0.00% 3.74%
amortised cost 938,510,580 136,903,707 83,566,516 1,158,980,803 320,375 320,375
5,903,110 91,708,238 5.30%
Loans and advances to customers at 2,008,137 - - 2,008,137
amortised cost 1,169,299 1,169,299 0.11%
0.41%
Debt investment securities at 314,334 398,377
amortised cost 1,483,633 1,567,676 0.75%
0.75%
Debt investment securities at FVOCI 459,912,729 - - 459,912,729 5,145,452 5,145,452 2.79%
5,145,452 5,145,452
Other financial assets 12,532,195 98,421,366

measured at amortised cost 495,290,182 - - 495,290,182 - - 0.06% 0.00% 0.00%
11,134,508 74,670,620 0.26% 8.13% 89.34%
Sub total 2,234,574,176 136,903,710 83,581,014 2,455,058,900

Off-balance sheet items:

- Letter of credits 22,059,650 - - 22,059,650 -- 5.30% 0.00% 0.00%

Financial guarantee and similar
contracts

- financial guarantees 362,816,565 - - 362,816,565 84,043 - 0.09% 0.00% 0.00%
84,043 - 0.39% 0.00% 0.00%
Sub total 384,876,215 - - 384,876,215

Notional lines:

Loan and other credit related

commitments 688,179,081 - - 688,179,081 - - 0.75% 0.00% 0.00%
- - 0.75% 0.00% 0.00%
Sub total 688,179,081 - - 688,179,081 11,218,551 74,670,620 0.38% 8.19% 89.34%

Total 3,307,629,472 136,903,710 83,581,014 3,528,114,196

#EnrichingLives Guaranty Trust Bank Plc | 2018 Annual Report | 341

OPERATIONAL RISK
MANAGEMENT

#EnrichingLives Guaranty Trust Bank Plc | 2018 Annual Report | 342

OPERATIONAL RISK MANAGEMENT

Guaranty Trust Bank defines Operational Risk (OpRisk) collection of internal OpRisk losses and near misses.
as “the direct or indirect risk of loss resulting from All staff are encouraged to report operational risk
inadequate and/or failed internal processes, people, and events as they occur in their respective business
systems or from external events”. spaces whether these risks crystallize into actual
In GTBank, Operational Risk Management involves losses or not. As a result, the Bank maintains a robust
the review and monitoring of all strategies and OpRisk loss database detailing relevant OpRisk loss
initiatives deployed in its people management, process data for eight years. Information collated is analyzed
engineering and re-engineering, technology investment for identification of risk concentrations, appropriate
and deployment, management of all regulatory OpRisk risk profiling and capital estimation.
responsibilities, engagement of third party services, and § Risk and Control Self Assessments (RCSAs) – This
response to major disruptions and external threats. is a qualitative risk identification tool deployed bank-
To ensure a holistic framework is implemented, wide. A risk-based approach has been adopted for
Operational Risk Management also monitors Strategic the frequency of RCSAs to be conducted by branches,
and Reputational Risks from a broad perspective. departments, groups and divisions of the Bank. All
GTBank considers strategic risk as the risk that not only branches and Head-Office departments are required
affects but are created by the Bank’s strategic decision. to complete the Risk Self-Assessment process at least
It is the possibility that the Bank’s strategy may be once a year. These assessments enable risk profiling
inappropriate to support its long-term corporate goals and risk mapping of prevalent operational risks
due to the inadequacy of its strategic planning and/or across the Bank. A detailed risk register cataloguing
decision-making process, inadequate implementation of key risks identified and controls for implementation
such strategies and strategy failure due to unexpected is also developed and maintained from this process.
circumstances. Risk Assessments of the Bank’s key processes,
The Bank aligns strategy and risk by identifying, assessing new and existing products, services, branches and
and managing risks and uncertainties, affected by internal vendors/contractors are also carried out. This process
and external events or factors, which could inhibit the identifies inherent operational risks and tests the
Bank’s ability to achieve its strategic objectives. This is quality of controls the Bank has in place to mitigate
done with the ultimate goal of creating and protecting likely risks.
stakeholder value. § Key Risk Indicators (KRI) – These are quantitative
A specialized template is deployed for tracking key parameters defined for the purpose of monitoring
business activities designed or defined by the Bank to operational risk trends across the Bank and its
measure and monitor performance in the achievement subsidiaries. A comprehensive KRI Dashboard is in
of its strategic intent in the short, medium and long term. place and it is supported by specific KRIs for key
The Bank regards Reputational Risk as the current and departments in the Bank. Medium to High risk
prospective adverse impact on earnings and capital trends are reported in the Monthly and Quarterly
arising from negative public opinion. It measures the Operational Risk Status reports circulated to
change in perception of the Bank by its stakeholders. It is Management and key stakeholders.
linked with customers’ expectations regarding the Bank’s § Fraud Risk Management Initiatives – Causal
ability to conduct business securely and responsibly. A analysis of key fraud and forgeries incidents identified
detailed template with internal and external factors that in the Bank or prevalent in local and global business
might impact the Bank adversely is used to monitor the environments are carried out and reported. Likely
Bank’s exposure to reputational risk. All adverse trends and unlikely loss estimations are also determined in
identified are reported to relevant stakeholders for timely the process as input in the OpRisk capital calculation
redress. process. The focus in Fraud Risk Management is
The Bank manages Operational risk by using to ensure that processes for preventing, deterring,
appropriate qualitative & quantitative methods in day detecting fraud and forgeries incidents, and
to day management processes and adopts various risk sanctioning offenders are effective.
mitigating strategies. The following practices, tools § Business Continuity Management (BCM) in
and methodologies have been deployed in the Bank line with ISO 22301 Standards – To ensure the
for the purpose of Operational Risk Management resilience of our business to any disruptive eventuality,
implementation: the Bank has in place a robust Business Continuity
§ Loss Incident Reporting – Loss incidents are Management System (BCMS). This system assures
timely resumption of critical business activities with
reported to the Operational Risk Management minimal financial losses or reputational damage
Group by all business areas in the Bank to enable and continuity of service to the Bank’s customers,
vendors and regulators. GTBank has remained
certified ISO 22301 BC compliant by the globally

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OPERATIONAL RISK MANAGEMENT

recognized Professional Evaluation and Certification and Supervision of Operational Risk”, Committee of
Board (PECB) for 4 years and continually improving Sponsoring Organizations (COSO) and International
in its BCM maturity, thereby signifying that the Bank Organization for Standardization (ISO).
has instituted internationally accepted processes, Operational Risk Capital Calculation – The Bank
structures and systems that demonstrate its capacity has adopted the Basic Indicator Approach (BIA) under
to resume business within a short timeframe in the Basel II Pillar 1 for the calculation of its Operational
event of any business disruption. Risk Economic Capital for internal risk monitoring and
Part of the BCMS is a Business Continuity Plan decision-making. Whilst the Bank has the required
(BCP), which is reviewed and updated periodically OpRisk loss data to migrate to other capital calculation
to ensure reliability and relevance of information methods i.e. the Standardized Approach, the application
contained. Various testing and exercising of the BIA is in line with the Central Bank of Nigeria’s
programs are conducted bank-wide to ensure that (CBN) recommendation for all banks in Nigeria.
recovery coordinators are aware of their roles and The estimated OpRisk Capital Charge is reported to the
responsibilities. Board and Management for guidance in Capital Planning
§ Occupational Health and Safety procedures and and decision making.
initiatives – Global best practices for ensuring the Governance Structure – The Board through its Board
health, safety and welfare of all staff, customers Risk Committee (BRC) oversees the operational risk
and visitors to the Bank’s premises are advised, function in the Bank and reviews OpRisk reports on
reported to relevant stakeholders are monitored a quarterly basis. It ensures that the OpRisk policy is
for implementation. Related incidents are recorded robust and provides an updated framework for the
bank-wide for identification of causal factors and Bank’s OpRisk profile and limits. It also determines the
implementation of appropriate mitigants to forestall adequacy and completeness of the Bank’s risk detection,
reoccurrence. measurement systems and mitigants whilst ensuring
As a result, the Bank conducts Branch Risk review and approval of the bank’s contingency plans for
Assessments, Fire Risk Assessments and Quarterly Specific risks. The Board lays down the principles on how
Fire Drills to guarantee the safety of its staff and operational risk incidents are to be identified, assessed,
visitors to any of its premises. Table talk fire drill controlled, monitored and measured.
(facilitated discussions) was introduced for locations The Management Risk Committee monitors and ensures
that discontinued regular fire drills due to security the implementation of the guiding OpRisk framework
scare. In addition, awareness on health and safety bank-wide. It considers and approves key decisions
issues are presented periodically on the intranet and relating to Operational Risk before presentation to the
via other forum. Board. The Committee ensures that all departments
Operational Risk Champions & BCM Champions in the Bank are fully aware of the risks embedded in
– Members of staff from various teams bankwide respective process flows and business activities.
are selected and undergo intensive Operational Risk All process owners are responsible for the day-to-day
management trainings. They become Operational Risk management of OpRisk prevalent in their respective
ambassadors in their various departments/ Groups, Departments, Groups, Divisions and Regions.
they further enshrine the OpRisk standards, culture The Internal Audit function conducts independent
and practices. The same is done in selecting Business reviews on the implementation of OpRisk Policies and
continuity Champions (BCM). Procedures bank-wide.
Operational Risk Management Philosophy and
Principles Treatment of Operational Risks – GTBank has
Approach to Managing OpRisk – Guaranty Trust maintained several risk treatment strategies to mitigate
Bank continually adopts operational risk procedures identified operational risks. These mitigants are applied
and practices that are “fit for purpose” this increases to achieve a residual risk level aligned with the Bank’s
the efficiency and effectiveness of the Bank’s resources, risk tolerances. In line with best practices, the cost of
minimize losses and utilize opportunities. risk treatments introduced must not exceed the reward.
This outlook entrenches OpRisk practices in the bank’s OpRisk treatment options adopted by the Bank include
day-to-day business activities. Risk Acceptance / Reduction, Risk Transfer, Risk Sharing
It also aligns the Bank’s Operational Risk Management and Risk Avoidance.
framework with sound practices recommended by various Operational Risk Reporting – Weekly reports have
local and globally-accepted regulatory agencies such as been added to the monthly, quarterly, and annual
Basel II Accord’s “Sound Practices for the Management reports highlighting key operational risks identified which
are circulated to relevant stakeholders for awareness and

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OPERATIONAL RISK MANAGEMENT
timely implementation of mitigation strategies. Reports
are also generated and circulated on a need-basis.

To ensure timely and comprehensive reporting of
prevalent OpRisk exposures in the Bank, an OpRisk
Management software/application is being used by
the Bank. This is to aid data collation and information
gathering, analysis, escalation and reporting of key
OpRisk incidents or emerging trends observed. Current
processes are also being automated.

#EnrichingLives Guaranty Trust Bank Plc | 2018 Annual Report | 345

ACTIVITIES OF CARDS
OPERATIONS

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ACTIVITIES OF CARDS OPERATIONS

5. Activities of Cards Operations We continually encourage the usage of our cards both
Within Nigeria and all other countries where we have a locally and internationally by providing the enabling
foothold, the group continues to abide by strict standards environment for smooth operations in terms of provision
and requirements for the issuance and usage of payment of modern technology, one of which is the contactless
cards. We carry out continuous upgrade of our card payment technology.
systems to ensure optimum security, absolute efficiency, Presented below are the highlights of our card transaction
cost effectiveness and customer satisfaction. Stringent volumes for period ended 31 December 2018.
fraud control measures have also been implemented to
reduce financial loss to both customers and the bank.

5.1. Table below shows a summary of transactions done on GTBank Cards


Category No. of Transactions Value of International Value of Local
Transaction Transactions

Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17

‘000 ‘000 N'mm N'mm N'mm N'mm

Naira denominated debit cards 284,224 230,458 75,685 32,049 2,390,508 2,113,904

Foreign currency credit cards 277 285 27,629 20,909 --

Foreign currency debit cards 1,529 1,072 68,563 45,909 2,699 1,712

Breakdown of transactions done using GTBank Cards (Number of transactions)

International Transactions Local Transactions

ATM POS/Web ATM POS/Web

In thousands Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17
Naira MasterCard debit
85 - 3,967 2,982 188,423 175,801 91,749 51,676

Foreign Currency 95 59 814 528 18 9 105 19
Denominated Cards:
MasterCard debit 11 9 112 94 - - - -
MasterCard credit
Visa classic debit 46 50 348 388 8 7 95 11
Visa classic credit
World credit 12 15 131 157 - - - -
Total
1 1 9 10 - - - -

250 135 5,381 4,158 188,449 175,816 91,949 51,706

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ACTIVITIES OF CARDS OPERATIONS

Breakdown of transactions done using GTBank Cards (Value of Transactions)

International Transactions Local Transactions

ATM POS/Web ATM POS/Web

In millions of Naira Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17
Naira MasterCard debit
3,337 - 72,348 32,049 1,677,752 1,650,268 712,756 463,636

MasterCard debit 9,699 4,908 31,934 19,447 233 87 1,781 967
MasterCard credit 1,326 902 8,375 4,747 - - - -
Visa classic debit 5,112
Visa classic credit 1,518 4,518 21,818 17,036 125 78 560 580
World credit 1,588 14,228 11,661 - - - -
Total 102 - - - -
21,094 94 2,080 1,917
12,010 150,783 86,858 1,678,110 1,650,433 715,097 465,184

5.2. Type of customers’ complaints and remedial measures taken

COMPLAINTS CATEGORY OF REASONS REMEDIAL MEASURES
Declined Transactions COMPLAINT Unrestricted cash
Declined Transactions on Restriction of cash withdrawals on
Complaints on delayed International ATMs & POS/ withdrawals on International ATM.
debits & double debits WEB International ATM Awareness
for Domestic POS & Web Usage on non-EMV Continuous engagement
Transactions Delayed Debits & Double terminals with Third party processors
Debits Insufficient funds to ensure adequate and
System glitch/ Technical effective maintenance of
error from Third party their systems to prevent
processors such incidences.

Dispense Error Cash/ Value not received This occurs when an ATM Escalation to the relevant
for a transaction attempts to dispense cash department of the
after an account has been regulators (CBN) to assist
debited but fails due to to check the activities
network failure. of processors/switches
This also occur when a responsible for persistent
customer’s account has incidents.
been debited for a certain Strict adherence to
amount for goods/services, resolution of customers’
but value is not received complaints within
stipulated time frame.

Proactive reversal of failed
transactions that are not
auto reversed.

Constant follow up with
relevant stakeholders
(e.g. switches and TPPs)
to address any identified
cause(s) of delayed refund.

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VALUE ADDED
STATEMENTS

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