Digital Banking and Financial Performance Review
GTBank Ghana Impairment
Following the suspension of all Debt Service Payments in line with the Domestic Debt Exchange
Programme (DDEP), the Ghanaian Government signalled default on its obligations. The DDEP proposed
a voluntary exchange of US $7.5billion (approx.) of existing Domestic Notes/Bonds held by various local
investors, for a package of new bonds with extended payout dates and reduced coupon rates.
The DDEP was the first step of the Country's Debt Restructuring Exercise, which was a pre-condition for
a US $3bn loan, that the Government had sought from the International Monetary Fund (IMF), to restore
macroeconomic stability and debt sustainability (with public debt at over 100% of GDP, and debt
service costs absorbing 70%-100% of revenues).
Guaranty Trust Holding Company Plc is exposed to Ghana's Sovereign Debt Restructuring, as a result of
its indirect investment in GTBank Ghana, which is a direct subsidiary of GTBank Nigeria Ltd (98%
ownership). The Group also has exposures to Eurobonds issued by the Government of Ghana, through
the following entities: GTBank Nigeria Ltd, GTBank Sierra Leone, GTBank Liberia, and GTBank Rwanda.
In line with IFRS 9, the Government's signal of default on debt payments and the ensuing Debt
Restructuring Plan is an impairment trigger requiring each of the Entities with exposures to the
Ghanaian sovereign securities to recognise impairment losses. The impairment levels applied to the
different classes of Financial Instruments (FIS) varied in line with jurisdiction, loss history, nature, and
timing of cashflows.
Group Exposure Per Instrument Type (N'Bn)
41.7
34.7
31.5
59.7
167.6
Impairment.
Exposure
-1.0
-4.2
-14.1
-16.3
-35.6
43.3
33.7
27.6 27.4
EAD*
132.0
Treasury Bills Eurobonds**
Bond: Local USD Bonds
Bond: Local Cedis Bonds
Total
Eurobond Exposure by other Entities within the Group (N'Bn)
Instrument Type
Treasury Bills
Assumptions
3.1% loss rate (after excluding post year-end settlements)*
Eurobonds
30%-45% loss rate
Bond: Local USD
13% loss rate
Bond: Local Cedis
27% loss rate
5.0
5.2
4.0
Exposure
2.4
Impairment
-1.3
-1.2
-1.6
2.4
3.6
2.7
EAD
-2.6
GTBank Sierra Leone
GTBank Nigeria
GTBank Liberia
GTBank Rwanda
*The loss rate of 3.1% was applied on the EAD after deducting post year-end redemptions of N6.99bn by the Government of Ghana.
*EAD - Exposure at Default Post-impairment (net position)
*DDEP Domestic Debt Exchange Programme
** Includes exposures by other Entities within the Group
1.2
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