Breaking News

Banks to slash workers’ pay

By Omoh Gabriel, Victor Ahiuma-Young
LAGOS—Indications emerged at the weekend that the 10 troubled banks will cut staff salaries across the board as a cost-saving measure to strengthen the survival path charted for them by the Central Bank, CBN.
The troubled banks  are: Intercontinental Bank Plc, Oceanic Bank Plc, Unity Bank Plc, Bank PHB, Union Bank Plc, Afribank Plc, Finbank Plc, Wema Bank Plc, Spring Bank Plc and Equitorial Trust Bank.
A very senior official of the apex bank told Vanguard that the option of salary cut for workers of the troubled banks was inevitable, considering the reality on ground. He said the salary cut will eventually be extended to the other banks.

The CBN top shot revealed that the current management in the troubled banks were asked to continue with the existing approved pay structure without bonuses.

He also dispelled the rumour that some of the troubled banks’ Managing Directors have bought bullet-proof Sport Utility Vehicles for their official use.

He noted that only one MD did so for his personal security.

According to him:  “When we invited the Chief Executives and Executive Directors  to run the banks and in some cases (the EDs) to leave well-paying positions in good banks and do this national service, we told them to take the existing approved pay structure in the banks without bonuses.

”However, a number of them are going to slash salaries across the board in the light of the current realities and this is to save cost.”

Continuing, he stated: “Only one bank Managing Director, to my knowledge, bought a bullet-proof SUV and he forfeited other vehicle entitlements.

”The reason we approved that was because we felt there was a genuine risk to his  safety as he was closing late and was unearthing frightening revelations.”

The CBN top official was reacting to allegations by some very senior bankers  that, “The salaries of the caretaker managing directors and executive directors of troubled banks who were brought in from retirement were too high and should be slashed to avoid imminent retrenchment or death of the banks.”

A text message from one of the retired bank chief executives read: “For example, one of the bank Managing Director’s mid-month and month- end salary for October was N5 million and N8m respectively.

”This amount excludes quarterly payment and other allowances paid outside payroll. This is the same amount as the one the previous executive directors in that bank got before they were sacked. Other troubled banks pay similar salaries.

”If the banks are really troubled, why not reduce salaries by 80 per cent for all staff to keep jobs and help the banks to recover. The CBN Governor should act fast, if not, the bailout money will only pay caretaker managers’ salaries.”

Another text message from another bank executive noted: “The so-called firms  to advice the banks were the same auditors who saw nothing wrong in their books.

”The new Managing Directors and executive directors in the troubled banks are earning the salaries of Akingbola, Cecilia, Atuche, Okey, Ebong, etc.

”The banks will die by the end of December, except these salaries are cut immediately by as much as 80 per cent and other staff by 50 per cent.  Retrenching staff is not the solution.

”Let the CBN do temporary nationalisation of the troubled banks and no Nigerian banks should be given the burden to acquire any of the troubled banks, it is too much wahala.”

Vanguard had reported, a fortnight ago, that the banking industry is experiencing an unprecedented wave of staff retrenchment with no fewer than 1,000 workers losing their jobs within two weeks.

The eerie development had forced the leadership of organised labour in the banking industry to ask the apex bank to call the banks to order, threatening to take them on.

Vanguard’s investigations revealed that on Friday, October 23, one of the four leading banks sacked 485 of its workers.
Sources close to the bank confirmed that it sacked 11 workers  at its Matori, Mushin, Lagos branch.

Labour vows to resist move

Meantime, Organised Labour in the banking sector has kicked against moves by the banks to slash the salaries of workers and vowed to resist such  with any means possible including industrial action.

Under the umbrella of the Association of Senior Staff of Banks, Insurance and Financial Institutions ASSBIFI, Labour wondered why the banks should be considering such ill-thought-out option aimed at punishing workers for no crime of theirs at this critical period of difficulties.

Speaking to Vanguard on the reported plans by the banks especially the troubled banks to embark on salary cuts, Acting President of ASSBIFI, Comrade Sunday Salako, advised the banks to jettison the plans to avoid industrial unrest in the sector.

According to him: “ Slashing workers salaries at this time? That will be bring another trouble to the system. If the banks want trouble, we will give it to them. We will not accept any salary cut especially a unilateral one for that matter. We will resist such moves by any means possible including industrial action. Why should the ordinary workers be made to suffer for the crimes they did not commit?

We are using this medium to not only advise the banks to jettison such plans, but also calling on government and Governor of the Central Bank of Nigeria (CBN), Mr. Lamido Sanusi, to prevail on the banks not to contemplate on cutting the salaries of our members in particular and the workers in general to avoid an industrial unrest in the banking sector which do nobody any good. We cannot understand why a poor man should be made to pay for the crime of a rich man. We will resist it. I can bet that”


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.