Despite the economic lull witnessed in Nigeria, which was largely caused by the Coronavirus pandemic, 13 Nigerian banks increased their personnel expenses from N254.06 billion in the first half (H1) of 2019 to over N271.64 billion in the same period in 2020
According to checks by Nairametrics Research, the banks, which are listed on the Nigerian Stock Exchange (NSE), increased their expenses by over N17 billion during the period under review and this shows a 6.92% increase.
13 banks collectively spent more than N178 billion as personnel expenses during the first quarter of the year.
This showed a 9.5% increase when compared to N162.6 billion, which the thirteen banks recorded during the comparable period in Q1 2019.
It should be noted that personnel expenses encompass all of a company’s expenditures in relation to its staff’s remuneration and welfare, albeit within a specific financial reporting period. In other words, such expenses may include salaries/wages, other benefits including health insurance costs, pension, and training among others.
From the available data, FBN Holdings recorded the biggest personnel expense in H1 2020. As much as N49.53 billion was spent on workers across the nation, compared to the N46.77 billion spent in H1 2019. FBN Holdings Plc is a holding company for First Bank of Nigeria Ltd and other subsidiaries such as FBNQuest, and FBN Merchant Bank.
The figure above represents personnel expenses for all the subsidiaries across the FBN Holdings group of companies. Further checks by Nairametrics Research revealed that FBN Holdings has a total of 9,016 employees as of December 2019.UBA Plc followed closely with N44.56 billion for its staff’s remuneration during the first six months of the year, compared to the N37.17 billion in H1 2019.
UBA had about 13,237 employees, according to information gleaned from its full-year 2019 financial statement.Zenith Bank came third with about N38.86 billion as personnel expenses. Interestingly, this is just 0.37% higher than its expenses in H1 2019.
Access Bank Plc witnessed a 16% increase in its personnel expenses from N31.24 billion in H1 2019 to N36.25 billion in H1 2020. This can be attributed to an increase in its staff strength from 4,273 in FY 2018 to 6,898 as of December 2019.Guaranty Trust Bank, Nigeria’s second most profitable bank, experienced a 1.1% rise in its expenses from N18.57 billion to N18.77 billion in the period under review.
The tier-1 bank is known for its very minimal operating cost approach. This probably explains why its staff strength as of December 2019 stood at 3,509.Surprisingly, Jaiz bank had the highest increase in expenses among the 13 banks listed on the NSE. With a 71% increase, its expenses grew to N2.12 billion from N1.24 billion in the period under review.
It is obvious that the COVID-19 pandemic did not have any impact on how much the bank workers earned and there is a slim chance it would for the rest of the year, considering the relaxation of lockdown measures.
Recall that after the pandemic hit, the Central Bank of Nigeria (CBN) had warned all banks against laying off any staff, as Nairametrics earlier reported.