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Declining profits force banks to cut jobs

By on December 10, 2013

Declining profits which characterised the nine-month results of a number of banks may have ignited a wave of job cuts in the banking sector, findings by our correspondent have revealed.

Some banks have sacked workers, about six months after the Central Bank of Nigeria introduced a stiffer monetary measure, asking the Deposit Money Banks to keep 50 per cent of public sector deposits with the CBN.

While a number of the DMB have already carried out what industry sources called ‘shedding off excess weight’, it was learnt that more banks might lay off some of their workers in the coming weeks.

At least four banks have sacked some of their workers in the last few weeks. They are Union Bank of Nigeria Plc, Enterprise Bank Limited, Unity Bank Plc, and Keystone Bank Limited.

Sources close to some of the banks, however, claimed the job cuts were part of the banks’ moves to remain competitive and increase shareholders’ value.

Union Bank and Unity Bank had disengaged some of their personnel. Enterprise Bank also reportedly sacked over 150 workers. The bank confirmed the development but declined to mention the number of staff members affected.

Keystone Bank Limited, which laid off some of its workers last week, said the ‘right-sizing exercise’ was ongoing, and that it was in continuation of the bank’s recently instituted performance-based appraisal system.

The Keystone source spoke under condition of anonymity, because he was not authorised to speak on the matter, explaining that the exercise was meant to make the lender efficient.

According to the source, the move was consistent with ongoing workforce rationalisation in the banking sector.

In the coming weeks, more banks are expected to ‘right-size’, in line with the tight monetary stance of the CBN in a bid to rein in on inflation, which it has succeeded in keeping at a single digit in the last six months, according to another source.

 

 

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