Key Points
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GTCO superior earnings quality drives top stock pick.
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Cost leadership strengthens profitability and resilience.
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Balance-sheet strength supports growth and credit creation.
Cordros Securities Limited’s equity analysts have picked Guarantee Trust Holdings Company (GTCO) as their top stock for 2026, even though the bank had trouble making money in 2025. The lender experienced declining profitability up to the third quarter due to cost pressures and lower earnings amid a tight regulatory environment.
Cordros said in its 2026 sector outlook that the Nigerian banking industry will start the year in a much better place because it has strengthened its balance sheets through recapitalisation. Analysts said that the industry would be stronger after the catch-up provisioning was finished in 2025 and the macroeconomic and interest rate environment became more stable. GTCO is rated “buy” with a target price of N115.19. It is known for having high-quality earnings, being the lowest-cost provider, and having a strong balance sheet.
GTCO superior earnings quality drives top pick
The report said, “We expect a re-rating in 2026 because return on equity (ROE) will continue to outperform cost of equity (COE), net interest income will stay healthy, and the company will continue to lead in cost management.” GTCO’s current share price of N86.00 gives it a price-to-book ratio of 0.9x and a price-to-earnings ratio of 4.5x, which means it could go up by 35.1%.
Cost discipline and a variety of revenue streams improve performance
Cordros said that GTCO’s strength comes from a mix of high-quality revenue, consistent margins, and a low-cost deposit base that allows for a structurally wide net interest margin. The bank has the lowest cost-to-income ratio in the industry, and it makes a lot of money from payments, digital channels, and corporate banking. This adds to its revenue streams.
Strong balance sheet supports growth and credit creation
Analysts highlighted that GTCO is the only bank with a ROE of 30.5 percent exceeding its COE of 25.1 percent, demonstrating its ability to generate sustainable returns from core operations. The apex bank’s industry-wide forbearance directive meant that GTCO was the only lender that didn’t have to worry about losing money. This helped it grow its loan book by 16.5% so far this year, while its peers only grew by 4.5%.
GTCO’s balance sheet is strong because it has a capital adequacy ratio of 36.5 percent, strong internal capital generation, stable low-cost deposits (CASA: 81.8 percent), and a liquidity ratio of 43 percent. Analysts said this combination provides flexibility for growth while cushioning the bank from macroeconomic and currency volatility.
Cordros said, “GTCO’s superior earnings quality, disciplined cost management, and strong balance sheet make it a top pick for 2026.” This shows that the bank can keep making loans and increasing core earnings throughout the year.
