In brief
- Earnings Momentum Weakens: EGH reported a 4.3% y/y decline in PAT to GHS1.4bn, missing our estimates by 9.0%, as weaker funded and non-funded income offset lower operating expenses and impairment charges. The results suggest that the cost containment-led earnings growth recorded in 1H2026 has run its course.
- Excess Liquidity Remains a Constraint: Loan growth of 34.7% y/y is encouraging, but the 42.9% loan-to-deposit ratio highlights significant excess liquidity, much of which remains deployed in government securities at depressed yields. We believe faster deployment into quality loans and stabilisation in asset yields will be critical to restoring earnings momentum.
- Earnings Support is Gradually Fading: We expect further cost savings to narrow as inflation picks up, while the scope for lower impairment charges is constrained by the still-elevated NPL ratio of 14.99%. Although net fees and commissions grew by 13.9% y/y, weaker trading and other operating income leave the non-funded income recovery uneven. We therefore see downside risk to FY2026 earnings growth.
- HOLD – Limited Valuation Upside: Our weighted average fair value is GHS39.23 per share (previously GHS41.25), representing an upside of 0.6% from the prevailing market price. The revision reflects the 9M2026 earnings miss, driven by topline weakness.