06 April 2016, Lagos – Guaranty Trust Bank Plc says it expects a further rise in inflation to the lower double digits in 2016.
The position of the bank was made known by its Chairman, Mrs. Osaretin Demuren, at the 26th Annual General Meeting of the bank held in Lagos on Tuesday.
Demuren noted that in the 2016 to 2018 medium-term expenditure framework, the Federal Government projected an inflation rate of 9.8 per cent for 2016 as it pursued its expansionary fiscal policy.
However, she pointed out that the bank expected that the effect of currency depreciation on the cost of imported items, impact of lingering fuel scarcity on transportation cost and food items would weigh on price levels.
“Hence, we expect a rise in inflation to the lower double digits in 2016,” The GTBank chairman said.
In terms of the currency value, she said even though the position of President Muhammadu Buhari and the monetary authorities indicated that the current foreign exchange policy would be maintained in 2016, “we believe that the resolve of the Central Bank of Nigeria to continue to hold the naira at the current level in the face of growing forex demand and dwindling external reserves while oil prices still remain depressed, will be significantly tested.”
To improve public finance, GTBank sees the Federal Government consolidating on the success of the implementation of the Treasury Single Account initiative by ensuring significant improvement in the collection and remittance of public revenue to plug revenue leakages.
Meanwhile, the bank had recorded growth during the 2015 financial year with gross earnings growing by 8.4 per cent from N278.52bn in 2014 to N301.85bn in 2015.
It also proposed a final dividend per share of N1.52, aggregating this with the N0.25 interim dividend per share approved during the first half of 2015. This brings the total dividend for the year to N1.77 per share.