First Bank discredits downsizing workforce, reduction of branch networks

…We are proud of our heritage –FBN

Contrary to indications that emerged recently that the wave of sacking that characterised the banking sector a couple of years back has not abated and that a massive job cut is inevitable, First Bank Limited, a subsidiary of First Bank of Nigeria Holdings, has debunked the rumours of cutting staff strength and or reduction in number of the lender’s branch networks.

Speaking to Daily Times Newspapers (DTN) on the telephone in Lagos recently, Head, Media and External Relations, Marketing & Corporate Communications, FBN, Mr. Babatunde Lasaki, said that there was no truth in any report linking the bank to reduction of its workforce or branch networks.

According to him, “if the management has such plan, they will announce it, and I have said this several times without number that we are not planning anything of such, either to reduce our workforce or to cut down on our branches.”

“We are proud of our heritage and also proud of our large branch networks, and the issue of cutting workforce or the branches do not arise, because there are other ways an organization can take to reduce its operating expenses, not by reducing its workforce”, he explained.

The indication had hitherto been that the nation’s dwindling economy, coupled with difficult operating environment, which often posts operating challenges to DMBs in the country, were largely responsible for the decline in profit of most of the lenders operating in Nigeria.

This has reignited the fear of the unknown which has continued to envelop bank workers, who are unsure whether their names have been penned down among employees who may lose their jobs.

However, a source close to FBN who would not want his name in print, disclosed that there is a conscious realization that to keep operating margins up and ensure that lenders can withstand present economic headwinds, labour has to be more intelligently optimized, this could mean reassignments or reclassification of designations.

This, however, aligns with what the immediate past Group Managing Director/CEO of the bank, Mr. Bisi Onasanya had disclosed in 2015 that FBN would be considering processes across the Group to reduce transaction costs and processing cycles. Realigning and rationalizing the workforce in order to enhance overall manpower efficiency and productivity is currently the target of the Group. 

He claimed this is part of the bank’s efforts to reduce its huge operating and personnel costs, which have had adverse effects on its bottom-line, regardless of the fact that the bank has the largest gross revenue in the industry.

The recently released 2016 Q1 financial result of FBN shows that that the commercial lenders profit after tax (PAT) fell by 8.3 percent to N20.7 billion in Q1 2016 from N22.6 billion in the corresponding period of 2015.

Meanwhile, indications have emerged that more bank workers will lose their jobs in 2016 following cost-cutting measures on  zero Commission on Turnover (CoT), even though account maintenance has been introduced by the CBN, Treasury Single Account (TSA) and a whole lot of issues which is been  introduced by the banks in order to mitigate the effects of some regulatory policies on their profitability.

Since the era of the global financial crisis in the mid-2008 and the special audit test carried out on banks by the Central Bank of Nigeria, the banking sector has witnessed a chain of job losses estimated at more than 20,000 by industry watchers.

President Buhari’s order for the implementation of a Treasury Single Account (TSA) with the Central Bank of Nigeria (CBN) has been fingered as a likely cause of these layoffs with experts predicting we will see more of this year 2016.