Banks to Sack 21,000 Workers

There is a fresh tsunami sweeping through the banking industry. It is called retrenchment of workers. Already, over 20,000 jobs are being threatened with Oceanic Bank Plc sacking 1,500 workers yesterday, in an exercise the bank said was ongoing.

This is as labour has threatened to shut down the banks over the disengagements. An executive director of the bank, who pleaded for anonymity, confirmed the retrenchment exercise, saying it cuts across every branch and all cadres of staff.

President of Independent Shareholders Association of Nigeria, Mr. Sunny Nwosu blamed the governor of Central Bank of Nigeria (CBN) Mallam Lamido Sanusi for the high rate of job losses, insisting that the CBN boss was not a good manager of men and material.

He argued that good managers always weigh the consequences of their actions with a view to providing cushioning effects.

This is as Minister of Labour and Productivity, Prince Adetokunbo Kayode has cautioned against massive retrenchment in banks.

Meanwhile, the gloom that engulfed the staff of Oceanic Bank came on the heels of the last’s week’s retrenchment of 1,500 of workers in Intercontinental Bank Plc, which has a work force of 5000.

Prior to this, the bank had sacked 26 of its top managers including some general managers as part of its three prong transformation project.

Also the United Bank for Africa Plc (UBA) had earlier conducted a similar retrenchment exercise even as indications are rife that Union Bank of Nigeria Plc and Finbank Plc will soon ask some workers to leave.

Spring Bank had earlier sacked 200 of its staff with Wema Bank retrenching 500 workers including 25 top managers.

Daily Champion gathered that the mass retrenchment in banks followed a directive by CBN that banks operating in the country should cut down on their staff strength by 30 per cent.

Also to be reviewed according to the directives by the CBN is the salary structure of banks. Sanusi had given all the banks in the country the end of this year to clean up their books in preparation for a stricter operating environment in 2010.

The apex bank said it was imperative that banks watch their cost over heads with particular emphasis on staff and salaries hence the demand for a minimum of 30 per cent reduction on both ends.

When Daily Champion visited some branches of Oceanic Bank yesterday, some of the workers were seen discussing in groups even as one of them declared that “the worst is not yet over”.

It would be recalled that Oceanic Bank was among the nine banks whose executive managements were sacked on the orders of the CBN on August 14. Former chief executive of the bank, Mrs. Cecilia Ibru is being prosecuted by the Economic and Financial Crimes Commission (EFCC) for alleged financial crimes.

The bank’s audited trading results for nine months ended September 30, 2009 showed gross earnings of N46.8 billion. This represents a 58.3 per cent decrease when compared to the N112.3 billion earned in the corresponding period of 2008.

The bank explained the drop to the suspension of interests of N93.9 on its non performing loans.

“Oceanic Bank is certainly on the part of recovery judging by the level of deposits mobilized over the last two months with a trend that shows further growth as we continue to implement aggressive deposit mobilization strategies” Mr. John Aboh who is the new group Managing director of the bank had assured.

However, the National Union of Banks, Insurance and Allied Financial Institutions (NUBIFI and Association of Senior Staff of Banks, Insurance and allied Financial Institutions (ASSBIFI) have frowned at the on-going retrenchment in banks, decision of the CBN to sacrifice their members under the on-going reforms, alleging that over 21,000 workers in the banks will lose their jobs by the end of first quarter of next year. The unions based their calculation on the fact that none of the 24 banks operate with an average work force of 3,000.

Meanwhile, the ongoing mass sack in the nation’s banking sector may throw the industry into another major crisis as the organized labour yesterday threatened to shut down the affected banks to business this week.
Angered by the disengagement of more than 3,500 employees by two commercial banks last week, the two workers’ unions in the banking industry, the Association of Senior Staff of Banks, Insurance and Financial Institutions (ASSBIFI) and the National Union of Banks, Insurance and Other Financial Institutions’ Employees (NUBIFE) have perfected plans to fight the erring banks to a standstill.

Daily Champion learnt that the two unions are worried that their members are being made to pay the price of the ongoing reforms in the sector and therefore vowed to take fight to the end and ensure that the welfare of their members is protected

General Secretary of NUBIFE, Comrade Elijah Segun, who described as unfortunate the reform process that could lead to the mass sack in banks, claimed that the union would ensure that the welfare of its members was adequately taken care of as the union could not fold its arms to allow injustices being meted out to its members.