Badly hit by the un-abating down-slide in economic activities in the country, the banking sector operators have begun to downsize operations as they seek to adjust to the new realities, The Rainbow investigations have shown.
Thousands of workers have been retrenched between December and last month as part measures adopted by the lenders to mitigate the effects of the economic downturn.
A combination of factors such as crippling fuel scarcity, worsen electricity supply situation, delayed budget and especially high cost of foreign exchange has drastically forced down industrial capacity utilisation, import and export activities and in general consumption of goods and services – all of which have direct impact in the operations of banks.
Our correspondents learnt that virtually all banks have cutback on the number of workers deployed in their operations, with some going further to cut their workers pay.
Reports indicate that First City Monument Bank had sacked over 600 of its workers, Diamond Bank 630, First Bank, hundreds even as it has announced officially that about a thousand of its workers would go.
Ecobank had at about March officially announced the disengagement of about 50 workers, but our correspondent learnt that the actual figures run into hundreds. Other banks such as Guaranty Trust bank, UBA, Skye bank, Heritage Bank were said to have discreetly undertaken similar exercise. It was learn that GTB, which had expanded operations in recent times, as it engages its arch-rival Zenith Bank in the battle for the retail space, was forced to shrink as the country’s economic outlook remained somber.
The Rainbow learnt that UBA and some other banks have consolidated on outsourcing of staff as a means of procuring cheap labour without taking on some of the costs statutorily stipulated for in-house staff.
Similarly, banks that have borrowed foreign denominated currencies would also be forced to restructure their debts as the naira is being expected to be devalued by a minimum of 22 per cent – meaning that lenders would have to put in extra efforts to generate enough cash to repay their debts. Furthermore, analysts point out that banks are still reeling from the full implementation of the Treasury Single Account (TSA).
