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Banking reform: More workers to lose jobs

By on February 17, 2012

As the Deposit Money Banks in the country continue to embrace cost-cutting measures, indications have emerged that another round of mass sacking is imminent in the banking industry.

Our correspondent gathered from reliable sources in the banking sector that more bankers would lose their jobs because some of the DMBs are preparing to reduce their running costs.

A top official in one of the acquired banks told our correspondent that the action was inevitable.

“There’s no way some people will not lose their jobs. For instance, after the acquisition, some banks had two branches very close to each other. What do you expect in such a case?” he asked.

It was also gathered, however, that the problem was not restricted to the acquired banks only, as some “healthy” ones had also adopted the measure to trim operating costs drastically.

Another top official, who pleaded anonymity because he was not permitted to speak officially, said, “Banks are now adopting a new business model to reduce their workforce in order to cut down on their operating costs.

“The emergence of the electronic payment system has made it possible to work with fewer employees.”

Access Bank Plc, which acquired Intercontinental Bank Plc, recently terminated the employment of over 1, 500 employees of Intercontinental Bank.

It was gathered that the basis for the mass sacking was the new appraisal system (Operation Just Cause), which Access Bank introduced in Intercontinental Bank on November 8, 2011.

In the same vein, Ecobank Transnational Incorporation, which acquired Oceanic Bank International Plc, disengaged an undisclosed number of workers on Wednesday.

Enterprise Bank Limited, formerly Spring Bank Plc,  one of the nationalised banks, on Tuesday said it had given 140 of its employees, whose performance fell below satisfactory level, an option to resign.

The bank had earlier introduced the implementation of a performance-based compensation system, which entailed the inclusion of a variable pay among members of staff.

When contacted, the National President, National Union of Banks, Insurance and other Financial Institutions Employees, Mr. Peter Okafor, told our correspondent that the union was on top of the situation.

Okafor said, “We have been talking to the managements of the banks.

Although the banks have the power to hire and fire, we will not fold our arms. Something needs to be done. We are also ensuring that due process is followed when carrying out this action. If due process is not followed, we will be forced to picket the banks.

“When you are telling people to go, you have to pay them what we call severance package. In the case of Intercontinental Bank, we are talking to them on behalf of our members. We sat down with the management of Ecobank too. So, we are on top of it.”

He said the sacking in the banks was a serious challenge to the banking sector and the economy at large.

Okafor blamed the Federal Government for the unemployment problems in the country, saying, “It is the responsibility of the government to provide jobs. All government initiatives have not provided jobs for the people.”