Access Bank PLC is planning to cut salaries of its workers to prevent job losses as lockdown occasioned by coronavirus has drastically affected its income.
Sources in the bank told Bloomberg that the reductions were expected to start from May unless business conditions improve.
The sources who said they were briefed on the matter during a conference call, said some management staff would get as much as a 40% decrease in their salaries. NobleReporters learnt
A spokesman for Lagos-based Access Bank declined to comment.
Nigerian banks are facing the threat of rising bad-debt levels as a crash in oil prices and the risk of a naira devaluation coincide with the Covid-19 pandemic that has shuttered businesses.
Access Bank, which acquired rival Diamond Bank Plc last year, had 6,898 permanent staff at the end of 2019, according to a presentation on its website.
The acquisition partly contributed to a 31% increase in operating expenses. Personnel, recruitment and training costs account for more than a third of overheads after the deal boosted employee numbers and resulted in “wage harmonization” across the businesses.
The group managing director of Access Bank, Herbert Wigwe, in a leaked video, has revealed the bank’s planned mass retrenchment of its workforce over what he said was the outcome of the COVID-19 lockdown.
Access Bank MD, Herbert who spoke via video conferencing in a town hall meeting with the bank’s staff said those to be affected are 75% of the bank’s staff, most of whom are outsourced and are offering “non-essential services.”
“We probably don’t need as many securitymen as required, even to the fact that we are not gonna have all our branches open between now and December. We don’t need all the tea girls. We don’t need all the cleaners. We don’t need all the tellers etcetera, etcetera,” He said in a leaked video currently making the rounds.
“The second has to do with our professional cost. Now that is one that is very tricky and it is tricky because I do understand and appreciate that its gonna, you know, bring its own pain to staff. We basically have to make the adjustments the same way you sounded when we spoke 10 days ago with respect to basically cutting down cost.
“I will be the first to take the hit and I’m gonna take the largest pay cut, which would be as much as 40 percent. The rest we would have to cascade right through the institution. Everybody may have to make some adjustments of some sort.”
Wigwe’s revelation is coming few weeks after the financial institution donated One Billion Naira to the Nigerian government to help fight Coronavirus.
Nigerian banking group Access Bank just created a subsidiary in Cameroon. With an initial capital of about XAF14.5 billion, the new subsidiary’s headquarters will be in Douala, Cameroon’s economic capital.
The administrative board of this subsidiary is constituted of seven members with only one Cameroonian, the legal notice published for the creation indicates. These members are Patience Melone, Iyabode Soji-Okusanya, Fatai Oladipo, Abraham Aziegbe, Ibukunoluwa Odegbaike, and Elliz Nzo Azu.
Created for a duration of 99 years, the bank has chosen Price Water House Coopers as its external auditor and will operate in the management of current accounts, savings collection, checks payment and credit granting.
As required by the rules in force, the launch of Access Bank Cameroon’s activities in Cameroon is still subject to the issuance, by the Ministry of Finance and the banking commission COBAC, of various legal notices and authorizations to the bank’s shareholders.
If it succeeds in launching its subsidiary in Cameroon, Access Bank Plc will become the 16th commercial bank to operate in the country and will meet one of its compatriots, United Bank of Africa (UBA), on that market. Let’s note that it is entering the Cameroonian market some years after the departure of another Nigerian group, Oceanic Bank International namely.
Some years ago, Oceanic Bank International took over 54.5% of Union Bank of Cameroon’s (UBC) assets saving it from bankruptcy. However, in 2011, Ecobank had to buy Oceanic Bank International’s assets in UBC, which is a well-rooted bank in the Anglophone regions of Cameroon.
Let’s note that last January 15, 2019, Access Bank Plc’s executive director Victor Etokwu announced that apart from the Cameroonian subsidiary, the banking group would create subsidiaries in two other African countries this year. The banking group will then have 18 subsidiaries in Africa.
Transactions in Nigeria’s equity market sustained its lackluster performance this week, amidst continued risk-off sentiments and the absence of positive market catalysts.
With losses recorded in two of the three trading sessions in the shortened week due to festive season, the All-share index shed -0.41 per cent to settle the Month-to-Date (MtD) and Year-to-Date (YtD) losses at -2.17 and 15.95 per cent, respectively.
Sell-offs in MTNN, FBN Holdings and ETI dragged the index 1.55 per cent lower to close at 26,115.80 points at the close of Monday’s transactions.
Accordingly, investors lost N197.4 billion as market capitalisation fell to N12.6 trillion while the Year-to-Date (YTD) return settled at -16.9 per cent.
Tuesday’s session saw Santa Claus failing to show up for equity investors trading on the floor of the Nigerian Stock Exchange (NSE) as sell-pressures in Stanbic, GT Bank and Dangote Sugar ensured the market’s Year-to-Date (YTD) returns declined further to -16.99 per cent.
As at the close of trading, the market’s All Share Index (ASI) sustained its bearish run, depreciating by 0.99 per cent to close at 26,090.88 points while investors lost N11 billion as market capitalisation settled at N12.595 trillion.
There was, however, no activity on Wednesday and Thursday as the market observed the Christmas and Boxing day holidays.
Friday’s session saw the market index up by 1.25 per cent to close the week at 26,416.48 points while market capitalisation increased by N157 billion to close the week at N12.752 trillion. This meant that investors lost a total value of N52 billion in one week.
On Sectoral performances, the Banking (-0.26 per cent) and Industrial Goods (-0.31 per cent) recorded declines, following selloffs of GT Bank (-2.0 per cent) and CCNN (-3.0 per cent) stocks. Conversely, Consumer Goods (+1.3 per cent), Insurance (+1.0 per cent), and Oil & Gas (- 0.7 per cent) edged higher, driven by gains in Nestle (+10.0 per cent), NEM (+2.2 per cent) and Oando (+6.76 per cent).
Access Bank was top on the activity chart with the sale of 42.03 million shares valued at N418.40 million. UBA traded 28.37 million shares worth N196.33 million while GT Bank transacted 22.78 million valued at N660.51 million.
The volume and value of stocks traded on Friday, stood at 222.51 million units and N3.04 billion, exchanged in 2,540 deals.
As at December 24, market breadth was negative as 12 stocks depreciated in value while 10 stocks appreciated.
Law Union topped the losers’ chart with 9.09 per cent to close at 0.50 kobo per share, Wapic followed with 8.33 per cent to close at 0.33 kobo, Dangote Sugar fell by 5.54 per cent to close at N13.56, FCMB declined to 4.76 per cent to close at N1.80 while Jaiz Bank dropped 4.29 per cent to close at 0.67 kobo.
Experts who spoke with Sunday Sun, said that despite the bearish performance, the Nigerian capital market remains an investment destination while adding that some pocket of gains should be expected prior to the start of the new year.
Chief Executive Officer, Sofunix Investment and Communications, Sola Oni, noted that the capital market operated under a tough economic climate in 2019 as evident in incessant bearish trend until the policy of the Central Bank of Nigeria on Open Market Operations (OMO) crashed yields on fixed income securities.
Oni said that the outlook for the market in 2020 is attractive, but is down to fixing of Nigeria’s weak economy where the Gross Domestic Product (GDP) currently grows at 2.3 per cent while the country’s population grows at 2.6 per cent, which is a misnomer.
“The capital market operated under a tough economic climate in 2019 as evident in incessant bearish trend until the policy of the Central Bank of Nigeria on Open Market Operations (OMO) crashed yields on fixed income securities.
“Expectedly, investors took flight for safety and reverted to purchase of equities with multiplier effects on the rise in many performance indicators but still, I will say that the NSE remains an investment destination,” he said.
On their part, Cordros Capital, in its weekly note, said: “We see the level of activity and volatility being sustained over the final days of the year, with some pockets of gains expected, as fund and portfolio managers realign portfolios prior to the start of 2020”.
Access Bank Plc has donated 66 laptops to spur the education of underserved children in Nigeria. The gesture is part of its effort to finance a sustainable future for its stakeholders.
The gift presentation, which took place on Friday, December 20, at the bank’s headquarters, was made to Slum2school – a development organisation that empowers children in slums and remote communities with quality education.
Speaking during the gift presentation, the Executive Director, Retail Banking, Access Bank Plc., Victor Etuokwu, said: “Access Bank understands the challenges faced by underserved communities in Nigeria, hence, we always strive to add value to the lives of the people in communities where we have footprint, leaving them better equipped to succeed.
“Children play a huge role in the future of every economy and we are collectively responsible for them. This is why Access Bank will continue to make substantial impact through welfare initiatives, ensuring that our children have access to education and other basic amenities,” he concluded.
Other notable initiatives by the bank in education are the annual Access Bank UNICEF charity shield Polo tournament held in partnership with Fifth Chukker – which has so far provided education for over 12,000 children in Northern Nigeria; the renovation of a dilapidated Information Technology Center and donation of 12 desktop computers at Ikosi primary school, Ketu, Lagos, among others.
The biggest names in Africa’s creative and entertainment industry like Burna Boy, Tiwa Savage, Naira Marley, Patoranking, Teni, David Tlale, Tokyo James, Odio Mimonet, Wisdom Franklin, Maria Borges, Adesuwa Aighewi and Millen Magese amongst others, will be showcasing the immense beauty of Africa and its talents at the second edition of the Born in Africa Festival (BAFEST) on December 15, 2019 at Eko Atlantic City, Lagos.
BAFEST is a fusion of music, art, film and fashion and a celebration of the distinct dynamism of the African spirit.
Grammy nominated artist, Burna Boy, who will be joined on stage by some of Africa’s biggest acts at BAFEST 2019 recently, performed alongside Grammy Award winning rapper, Cardi B in Lagos.
The day-long event will see these artistes feature in a concert after a showcase of arts, music and African film highlighting and rewriting Africa’s negative narrative.
Speaking about BAFEST, Group Head, Communications & External Affairs at Access Bank Plc, Amaechi Okobi, said,
“For us Africans, music, art, film and fashion are much more than the lyrics, paint, stories and fabrics, they’re all forms of showcasing our culture, its richness, as well as its diversity. They are depictions of our style and identity.
Last year, at BAFEST 2018, we had a fantastic time bringing together some of the most talented human beings on the continent. It was an opportunity to showcase these superb minds to the world and this year’s edition will be no exception.
We, at Access Bank, have over the past few years continued to highlight the best Africa has to offer with our string of event partnerships such as the Access Bank Lagos City Marathon, Art X Lagos and the African International Film Festival. With these events and with BAFEST we’re aiming at rewriting the African narrative of negativity while positioning the best the continent has to offer.”
BAFEST, which is free for Access Bank account owners, is powered by Access Bank and produced by creative collective, Livespot360.