Chief Executives of Deposit Money Banks (BMBs) have resolved to minimise the high rate of personnel layoffs across the banking institutions. However, they maintained that the option of sack will apply for any staff that is involved in fraudulent transactions or those that fail to measure up in their performance charts.
Managing Director, Standard Chartered Bank, Mrs. Bola Osibodu, who spoke on behalf of other lenders, disclosed this to journalists at the end of the Bankers’ Committee meeting in Abuja yesterday.
The Bankers’ Committee is an umbrella body comprising the Central Bank of Nigeria (CBN), DMBs, Discount Houses and finance-related bodies such as the Chartered Institute of Bankers of Nigeria (CIBN) that meets bi-monthly to discuss the state of affairs on the industry.
Osibodu said: “Banks in the country are looking at ways to ensure that we minimise exits from our institutions, there will always be exits if there is fraud and so forth, people will exit institutions.” She said retrenchment in banking sector is not new.
His words: “It is something we have discussed in the past where the CBN governor prevailed on the banks to minimise any exits from the institutions. “Banks understand the implication of people not being in employment.
So, we noted the market sentiments and going forward it will be different but there will be reasons why people will exit not just in the banking industry but in telecoms and other industries. It is something that we will manage.” Just last Tuesday, the Federal Government threatened to withdraw the operating license of any bank or telecommunication company that breached its directive to stop mass sack of workers.
Minister of Labour and Employment, Senator Chris Ngige, who made the government’s position known to journalists at the 105th session of the International Labour Organisation (ILO) in Geneva, Switzerland, warned that government would sanction erring companies because it had a duty to protect jobs in this harsh economy. But at the Bankers’ Committee meeting yesterday, lenders were said to have told the CBN governor, Godwin Emefiele, that the government does not have the right to legislate on private institutions. Emefiele was said to have agreed with the lenders but appealed to them not to lay off staff and cooperate with the Federal Government. On financial inclusion, Osibodu said the apex bank is developing the National Collateral Registry and that it had put the framework and technology in place.
Besides, she said the banking watchdog had “begun to engage stakeholders so we should expect the roll out of the collateral registry to be made available to banks to register moveable assets that they lend against.” A policy statement she said will be issued shortly and that will make the banks’ credit process more robust in lending to customers against moveable assets.
The Standard Chartered Bank boss said: “The essence of the collateral registry is that with your phone and any other assets that you have in your house you can take a loan and still retain the services of those assets once they are properly registered. “The National Collateral Registry is being introduced so that people who have been constrained by lack of collateral from taking loans, once your car is registered, you can take a loan and then be using it and then pay back your loan. But if you don’t pay back your loan that car may be recovered at the appropriate time.”
Also speaking, CBN Director of Banking Supervision, Mrs. Tokunbo Martins, expressed worry that despite all the efforts by the apex bank to ensure that all Nigerians are included in the banking system, the nation still has inclusion rate of 60.5 per cent. She noted that the CBN is targeting 80 per cent inclusion by 2020 and by the end of this year it would achieve additional 8 per cent, which is about six million of the population. However, the outgoing Managing Director of UBA, Mr. Philip Oduoza Philip Oduoza, warned currency speculators that they would be deceived when the much awaited flexible exchange rate is rolled out.
The CBN, he said, has received “a lot of input from various stakeholders and these inputs are being distilled with a view to getting a robust flexible exchange rate model. In a very short while, the framework would be ready and once this happens, it is going to be made public and we will start running with it immediately.”
The Bankers’ Committee, he added, believes “that it is important that we get it right. So, we don’t have to go back to the drawing board. We need to exercise a little bit of patience but I can tell you that we are coming up with a framework that will be able to address a lot of the issues that surround foreign exchange in Nigeria.” Some of the banks have sacked over 3,000 workers while others are in the process of sacking some of their workforce. In January, FCMB sacked 700 staff while Ecobank has sacked a total of 1,090 workers this year.
First Bank plans to lay off a total of 1,000 this year while Diamond Bank sacked 430 in May. Just on Monday, Skye Bank announced the sacking of 175 of its workforce but there are indications that over 1,000 staff were laid off. Meanwhile, the organised labour has vowed to cripple operations in the banking sector over ongoing mass retrenchment of workers.
It applauded the threat by the Federal Government to withdraw the licenses of banks that breached its directive to halt further retrenchment. Labour also issued a 21-day ultimatum to the affected banks to recall the sacked workers or risk unprecedented industrial action. At a joint briefing in Geneva, leaders of the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC), insisted that they would picket banks that indulge in further mass sacking of their employees.
Speaking at a briefing at the venue of the on-going 105th International Labour Organisation (ILO) conference in Geneva, Switzerland, both NLC and TUC insisted that just like the banks disobeyed the laws of the country and retrenched workers “we will picket them to show the banks that they do not have monopoly of law of disobedience.” The briefing was addressed by Ayuba Wabba of the NLC and the TUC President, Bobboi Kaigama. Also, the labour leaders frowned at the refusal of the banks to allow their workers to unionise.
