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Analysis: Guaranty Trust Pension Managers AUM rises by 51.7% in 2023

Guaranty Trust Pension Managers has published its 2023 corporate and pension fund audited accounts, providing a summary overview of its financial health and fund performance.

This report provides a summary review and presents key financial highlights, financial ratios, fund performance, and the trend in the number of Retirement Savings Account (RSA) holders.

Financial Highlights

  • Total Revenue: The audited accounts revealed a 46% increase in total revenue, growing to just under ₦2.1 billion in 2023, up from ₦1.43 billion in 2022. The core growth came from interest income earned from investing company capital, which rose 39% (₦402.7 million) in 2023. Investment management fees, i.e., and income earned from managing pension funds grew ₦196.3 million (50%).
  • Profit After Tax (PAT): PAT (before fair value adjustments) rose 51% to ₦745.4 million, reflecting progressive growth from the previous year’s ₦492.4 million.
  • Operating Expenses: Operating expenses rose faster than revenue and PAT, rising by by 56% to ₦1.08 billion from ₦692.5 million, leading to a rise in the company’s cost-to-income ratio, from 48.45% to 51.91%, indicating company feeling the current inflationary pressures.
  • Shareholder’s Funds: Company’s shareholders fund ended the year at ₦12.61 billion in 2023 up 8.38% from ₦11.63 billion in 2022.
  • Return on Equity (ROE): ROE came in at 5.91%, substantially below inflation which closed 2023 at 28.92%.

Financial and Fund Highlights

Corporate Audited Annual Results

Financial Ratios

Fund Performance Highlights

  • RSA Funds Performance: Guaranty Trust Pension Managers offers 6 of the regulated RSA pension funds to the public. All 6 funds performed better in 2023 than they did in 2022, but 2 underperformed the 2023 industry benchmark for their respective funds (see our article on benchmark returns here), and none of the funds outperformed inflation, which closed December 2023 at 28.92%.

Fund Performance Highlights

5-Year Audited Pension Funds Performance

Number of RSA Holders

  • RSA Growth: The number of RSA holders grew by 7.30% in 2023, to 94,049, up by 6,397 on 2022.

No. of RSA Holders

 

Demographic Analysis

  • Age Distribution: The majority of 330,000 RSA holders (83.9%) registered in 2023 fell within the age bracket of <30 years to 39 years, indicating a young and growing industry subscriber base. Of the 2023 registrations, Guaranty Trust Pension Managers recorded just 1.94% of this growth.

Conclusion

Guaranty Trust Pension Managers continues to try to find its feet in the pension industry, having come late to the party and it continues to demonstrated stable financial health for its shareholders. The company now needs to grow its RSA numbers to generate income from its core mandate of managing pension funds. It also needs to improve the investment returns generated by those pension funds and be more competitive as this, amongst other things is what will attract anyone looking at the transfer window to move to Guaranty Trust Pension Managers.


This article was written by Michael Oyebola. Watch out for the 2024 Money Counsellors Annual Report on Pensions. MCARP 2023 available here.

© MoneyCounsellors.com


Source: Naijaonpoint.com.

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