When Access Holdings’ Brawn Succumbs To GTCO’s Brain .
Access Bank’s mad rush for for acquisition at expense value delivery continues to raise a critical question : Is Access Bank an ‘Idiot’?
In the Nigerian banking landscape, a tale of two titans unfolds: Access Holdings, the behemoth with brawn, flexing its muscular balance sheet and aggressive growth trajectory, versus Guaranty Trust Holding Company (GTCO), the cerebral powerhouse, leveraging its razor-sharp focus on efficiency and profitability to outmaneuver its rival. While Access Holdings’ sheer size and diversified business model make it a force to be reckoned with, GTCO’s precision-driven approach to banking has yielded impressive results, raising a crucial questions on Access Holdings business model .
No doubt, the two prominent players, Access Holdings and Guaranty Trust Holding Company Plc (GTCO), have demonstrated strong financial performances.However , Access Holdings appears to have misconstrued the battle for the industry leadership as a game of resource accumulation when in reality what determines the success is resourcefulness; it fails to acknowledge the fact that a company can boast an impressive array of assets, from mountains of cash and legions of talented people, and still lose its preeminent position if it fails to leverage these resources effectively. Conversely, GTCO appears to be wiser . It believes a company with limited resources can overcome seemingly insurmountable handicaps and achieve greatness through resourcefulness, foresight, and a well-defined sense of purpose. To it , the key to success lies not in the quantity of resources, but in the ability to utilize them strategically and innovate in response to changing circumstances.
In a nutshell , getting to the future first , to GTCO , is more a function of resourcefulness than resources. It requires a deeply felt sense of purpose, a broadly shared dream, and a truly seductive view of tomorrow’s opportunity. Companies that prioritize these qualities are better equipped to navigate the ever-shifting competitive landscape and emerge as industry leaders. By focusing on resourcefulness and strategic leverage, businesses can unlock their full potential and achieve greatness, regardless of their starting position.
Access Holdings’ Brawn Over GTCO’S
It is on the basis of the above differential that the battle for leadership battle between the duo was fought in the 2024 financial year . Access Holdings boasts total assets of ₦41.498 trillion, significantly outpacing GTCO’s ₦14.8 trillion. Access Holdings’ customer deposits stand at ₦22.525 trillion, more than double GTCO’s ₦10.4 trillion, highlighting its dominant liquidity position. In terms of shareholders’ funds, Access Holdings leads with ₦3.760 trillion, compared to GTCO’s ₦2.7 trillion.
When examining their loans growth, Access Holdings’ gross loans surged to ₦13.1 trillion from ₦8.9 trillion in 2023, while GTCO’s net loan book stands at ₦2.79 trillion. This suggests different strategic focuses, with Access Holdings aggressively expanding its lending portfolio and GTCO maintaining a stable and significant lending presence.
It is clear both entities have different missions . While Access Holdings’ scale and growth trajectory are notable, GTCO’s stability and commitment to delivering value to stakeholders are commendable. The comparison highlights the banks’ unique strengths and positions within the industry.Is Access Bank an idiot ? That the race to competition is or should be perceived as a race to build competencies not simply to gain an immediate market share is unassailable.
The answer to the above question is delivered by the fate of Access Holdings relative to its competitors : when it comes to the revenue generation and profitability , the financial performances of Access Holdings and Guaranty Trust Holding Company (GTCO) for the 2024 fiscal year reveal not only strong growth trajectories for both banking giants but also the idiotic business model of Access Bank .
The revenues followed the expected lane while their profitability moved along a strange lane . Access Holdings reported impressive gross earnings of ₦4.878 trillion, with a profit before tax (PBT) of ₦867.019 billion and a profit after tax (PAT) of ₦642.22 billion. These figures demonstrate the bank’s ability to generate significant revenue from diversified income streams and digital expansion.
The Cerebral Power of GTCO Over Access
In contrast, GTCO’s financial results showcase remarkable profitability, with gross earnings of ₦2.15 trillion, a PBT of ₦1.27 trillion, and a PAT of ₦1.02 trillion. Notably, GTCO’s PAT margin is significantly higher than Access Holdings’, indicating efficient operations and effective cost management.
The implications of these results are twofold. Access Holdings’ strong gross earnings suggest a dominant market position, driven by its diversified business model and digital initiatives. However, its PAT margin is lower compared to GTCO, which may indicate areas for improvement in cost optimization. In my dialect , Access Bank is omo o patoro, da nain nu , the height of stupidity .
GTCO is not the only bank messing up Access Holdings, Nigeria’s largest bank by total assets . It reported the lowest net income among its peers in 2024, with a modest 3.7% increase to N642.2 billion. Despite its dominant position, the bank’s profit margin declined sharply to 13.2%, the weakest among its peers. This decline can be attributed to the bank’s elevated interest expense, which stood at N2.21 trillion, the highest among its peers. Additionally, Access Holdings’ cost-to-income ratio jumped to 58.3%, indicating strain on operational efficiency due to its aggressive expansion strategy.
The fate of Access Bank is a straight outcome of its made drive for acquisition. The bank’s expansion drive has resulted in significant costs, including N30.56 billion for acquiring Access Bank Tanzania and N159.8 billion for the ARM Pension transaction. Furthermore, Access Holdings’ total borrowings stood at N2.4 trillion, a notable increase from N1.9 trillion in 2023, further straining profitability. While the bank’s expansion has built scale and market presence, it has come at the cost of compressed margins and rising borrowings. With the highest cost-to-income ratio and largest interest expense, Access Holdings is navigating a growth path that prioritizes market capture over near-term profitability
As opposed to Access , GTCO’s exceptional profitability highlights its operational efficiency and ability to maintain a strong bottom line. The bank’s focus on efficient operations and cost management has yielded impressive results, positioning it as a leader in the industry.At the end of the 2024 financial year, GTCO’s cost to income ratio was 24.1%, which is a significant improvement from the previous year’s 29.1% and highlights the group’s operational efficiency and strong financial performance.
When the Investors Fight Back
Access Bank is already paying the costly of its stupid business model delivered to its controversial acquisition of the rested Intercontinental Bank that raised its status to a first tier bank . Its market value followed the same trend as its profit relative to its peers .
In the Nigerian banking sector, where financial metrics are scrutinized and investor confidence is paramount, Access Bank’s valuation metrics present a paradox. On the surface, the bank’s stock appears undervalued, with a price-to-earnings ratio of 4.56x and a price-to-book ratio of 0.32x. However, a closer examination reveals underlying concerns that may be driving these discounted valuations. As the banking landscape continues to evolve, can Access Bank address its fundamental challenges and unlock value for its shareholders, or will its valuation remain a puzzle with no solution? Access Bank’s valuation metrics reveal a complex picture of its financial performance. The bank’s price-to-earnings (P/E) ratio decreased from 5.63x in Q1 2024 to 4.56x in Q1 2025, indicating that investors are pricing in underlying weaknesses. Similarly, the price-to-book (P/B) ratio dropped from 0.52x in 2024 to 0.32x in 2025, suggesting that the bank’s stock may be undervalued compared to its book value. When compared to its peers, Access Bank’s financial performance may be lagging, leading to a discount in its valuation multiples. Several factors may contribute to Access Bank’s low valuation, including high debt levels funding rapid expansion, weak fundamentals, and inefficient performance. The bank’s inability to translate its asset dominance into proportional value and its struggles with interest expenses and net interest income raise concerns about its financial performance. As the banking sector continues to evolve, Access Bank must prioritize effective risk management, interest rate strategies, and resource leverage to remain competitive.
Shareholders of Access Bank are growing increasingly concerned about the bank’s declining return on equity (ROE), assets (ROA), and net interest margin (NIM). Despite the bank’s impressive growth in gross earnings, its profitability metrics have failed to keep pace, raising questions about the effectiveness of its business model and management’s ability to generate returns for investors. The bank’s ROE, ROA, and NIM have all trended downwards, indicating that Access Bank is generating lower returns on its equity and assets, and facing pressure on its core lending business.
A comparative analysis of Tier-1 bank stocks revealed varying degrees of performance. While GTCO’s share price surged 62.7% from N57.00 to N93.00, Zenith Bank’s share price jumped from N45.85 to N75, and UBA’s share price rose from N34.20 to N46. In contrast, Access Bank’s share price showed a relatively modest gain, increasing from N24.10 to N27.45. This disparity in performance may be attributed to various factors, including differences in financial performance, strategic initiatives, and investor sentiment.
Notably, GTCO’s successful listing on the London Stock Exchange and its exemption from the Central Bank’s forbearance loan policy may have contributed to its strong share price performance. Meanwhile, Access Bank’s slower progress in resolving regulatory forbearance exposures may have tempered investor enthusiasm, resulting in a more subdued share price movement.
In contrast to Access Holdings, GTCO had achieved a milestone that served as a testament to investor confidence. Guaranty Trust Holding Company PLC (GTCO) made history by becoming the first NGX-listed financial company to trade above the N100 per share threshold, reaching a milestone price of N101.00 on July 16, 2025. This achievement reflected strong investor confidence, driven by the bank’s sustained positive performance, strategic initiatives, exemption from the Central Bank of Nigeria’s forbearance loan, policy, and successful listing on the London Stock Exchange. With a market capitalization of N3.68 trillion, GTCO demonstrated its dominance in the Nigerian banking sector, boasting a market capitalization more than twice that of Stanbic IBTC, despite similar share price levels around N100. These movements indicated a strong performance in the banking sector, driven by strategic initiatives and positive investor sentiment, and GTCO’s milestone achievement was a positive indicator of the sector’s growth potential
What went Wrong
The superior profitability of GTCO may not be farfetched. .In the quest for industry leadership, a well-defined strategic architecture, combined with stretch and leverage, is crucial for success. Strategic architecture provides a clear blueprint for building and allocating resources, while stretch goals drive innovation and ambition. Leverage, meanwhile, enables companies to maximize their assets and capabilities, achieving disproportionate impact with limited resources. Together, these elements fuel proactive advantage building and industry re-engineering, allowing companies to overcome resource handicaps and outmaneuver competitors. By harnessing the power of strategic architecture, stretch, and leverage, businesses can create a sustainable path to industry leadership and stay ahead in the competitive landscape.
The capability of each player in the banking industry is exposed by its ability to lend profitably and safely. This ability serves as a key differentiator, distinguishing successful banks from those that struggle to remain competitive. Ultimately, a bank’s lending prowess is a reflection of its overall risk management capabilities and its ability to navigate the complexities of the financial landscape.
Loans are a critical source of income and profitability for banks, but they also pose significant risks. Effective risk management is essential to navigate the complexities of loan portfolios and ensure long-term sustainability. Banks face various challenges in managing loan risks, including assessing borrowers’ creditworthiness to minimize default risk, managing the mismatch between assets and liabilities to minimize interest rate risk, and ensuring sufficient liquidity to meet loan demands and manage cash flows.
To mitigate these risks, banks must prioritize risk management, identifying, assessing, and mitigating potential risks that impact financial performance and reputation. By managing risks proactively, banks can minimize losses, optimize returns on assets, and maintain stakeholder trust. Banks must strike a delicate balance between risk and reward in their loan portfolios, generating revenue while minimizing the risk of default and other adverse outcomes. By prioritizing risk management, banks can ensure the long-term sustainability of their loan portfolios and maintain their position in the market.
This is where GTCO is teaching the leadership of Access Bank is a serious lesson in banking . In the dynamic banking landscape, effective risk management is the linchpin of sustained success. Guaranty Trust Holding Company Plc (GTCO) has once again demonstrated its mastery of this critical discipline, outshining Access Holdings with its robust financial performance. A closer look at the numbers reveals GTCO’s superior risk management capabilities as the driving force behind its remarkable profitability growth, setting a new benchmark for the industry
A comparative analysis of Guaranty Trust Holding Company Plc (GTCO) and Access Holdings reveals GTCO’s superior risk management capabilities as a key factor in its financial outperformance. GTCO’s effective credit risk management is evident in its lower impairment charges of ₦136.661 billion, compared to Access Holdings’ ₦245.319 billion. Despite this, GTCO’s net interest income after impairment remains substantial at ₦921.924 billion.
GTCO’s ability to manage interest rate risk is also noteworthy, with a significant 107.8% increase in profit before tax to ₦1.266 trillion. In contrast, Access Holdings’ interest expenses grew at a faster rate than its interest income, potentially exposing it to interest rate risk. GTCO’s interest expenses/interest income ratio is approximately 21.07%, calculated as ₦282.415 billion (interest expenses) divided by ₦1.341 trillion (interest income). In contrast, Access Holdings’ interest expenses/interest income ratio stands at approximately 63.56%, with interest expenses of ₦2.212 trillion and interest income of ₦3.480 trillion. This significant difference highlights GTCO’s superior cost management and higher profitability from interest income, further underscoring its strong financial performance
A comparative analysis of the two banks reveals GTCO’s superior financial management and risk mitigation strategies. GTCO’s net interest income after impairment stands at ₦921.924 billion, a testament to its ability to manage risk and maintain profitability. Access Holdings’ net interest income after impairment, although growing by 84%, is impacted by its higher impairment charges.
The dividend payout of ₦8.03 per share recommended by GTCO’s directors is a reflection of the bank’s confidence in its financial performance and commitment to rewarding its shareholders
In terms of liquidity risk, both banks demonstrate strong positions, but GTCO’s efficient management of its ₦14.8 trillion in total assets and ₦2.79 trillion loan book (net) is impressive. Access Holdings’ deposit-heavy balance sheet is a positive factor, but GTCO’s overall asset management appears more effective.
The outcome of these risk management strategies is reflected in the banks’ profitability. GTCO’s profit after tax surged 88.6% to ₦1.107 trillion, outpacing Access Holdings’ 3.7% increase to ₦642.22 billion. GTCO’s superior risk management framework has enabled it to achieve remarkable financial growth and profitability, solidifying its position as a leader in the banking industry.
GTCO’s superiority over Access Holdings is further underscored by its differential cost optimization strategy. A key metric that highlights this disparity is the cost-to-income ratio. GTCO’s efficient cost management has enabled it to maintain a competitive edge, whereas Access Holdings’ relatively higher cost-to-income ratio suggests potential scope for improvement in this area. By optimizing costs, GTCO has been able to allocate resources more effectively, driving profitability and reinforcing its position as a leader in the banking industry.
This cost optimization strategy is reflected in GTCO’s impressive profit after tax growth, which outpaced Access Holdings’ growth rate. GTCO’s ability to manage costs effectively has contributed to its robust financial performance, demonstrating a key differential factor in its success. By prioritizing cost efficiency, GTCO has positioned itself for sustained growth and profitability in the competitive banking landscape.
