FSDH Merchant Bank Ltd, Inflation rate, private sector loans, NBS

Nigeria is a country blessed with abundant supply of human resources. Unofficially, there are upward of 200 million people in Nigeria. Nigerians are known to be smart people many of whom have excelled in various endeavours. The news media is replete with news about Nigerians achieving one feat or the other either in Nigeria or abroad.

For example, Philip Emeagwali, a Nigeria, referred to by Bill Clinton as the “Bill Gates of Africa”, is a supercomputer genius who played a major part in making the internet a reality and what it is today. Dr Elizabeth O. Ofili, another Nigerian, is an accomplished and acclaimed cardiologist who received the Young Investigator Research Award from the American Society of Echocardiography and Mallinckrodt Cardiology in 1993, for her echo studies of myocardial blood flow. She is the first president of the Association of Black Cardiologists in America. The list goes on and on. Did I hear you say, Naija no de carry Last?

Unfortunately, they say that a prophet is without honour in his own village. A review of the recently released “selected banking data” for Q3 by the National Bureau of Statistics indicates that the whole banking industry in Nigeria employs just 102,821 people, majority of whom are contract staff. The banking industry is one of the most profitable in the country and when the industry sneezes, the Nigerian Stock market catches cold. If such a profitable and vibrant sector is employing so little portion of the national workforce, it stands to reason that the unemployment rate will remain quite high in Nigeria for some time.

Compared with the United States’ banking industry, Nigerian banks as a whole have a staff strength that is less than that of a bank, Wells Fargo. According to Statistica.com, the 5 leading banks in the US, in terms of staff strength, have 806,934 people on their payroll. Statistica.com has it that Wells Fargo alone had 232,321 people in their employment in 2017, JP Morgan Chase – 191,929, Citibank – 169,092, Bank of America – 142,412, while US Bank’s staff strength as at 2017 was 71,180. The population of the US is slightly higher than that of Nigeria and US banks use more technology than Nigerian banks, yet, they employ much more people than Nigerian banks.

Little wonder why the November edition of the CBN’s Monthly Business Expectations Survey Report shows that survey respondents were more optimistic that the wholesale/retail trade has the highest prospects for creating jobs. As Nigerians begin to conduct more and more of their transactions digitally, banks may become less and less employers of labour which do not augur well for the ever-increasing\ Nigerian labour market.

However, given that increased digital transactions come with increased risk of fraud, the banks should increase their headcount by employing those that will be responsible for information and data security so as to wall off any threats of digital fraud.

The reason why US banks that are grossly dependent on technology employ so many people is that they do not engage solely on the type of cash and carry businesses that Nigerian banks do. Their banking business cuts across many facets of economic activities, from mortgage lending, investment banking, commercial/retail banking to hedge fund and litigation finance.

A whole lot of them have huge research and product development departments where they brainstorm on how to create financial products through financial engineering. Many banks in Nigeria still depend on commission on turn over, (COT), ATM fees, overdraft interests for their revenue rather than employ the bright and smart to think out ways to create financial products.

Coronation Research
Uchenna Ndimele is the President of Quantitative Financial Analytics Ltd. MutualfundsAfrica.com and mutualfundsnigeria.com (both Quantitative Financial Analytics company website) is a leader in supplying mutual fund information, analysis, and commentary on African mutual funds. We provide reliable fund data; and ratings information that will add value to fund managers, the media, individual investors and investment clubs.


  1. Nigeria banks also engage in treasury operations, along with trade transactions, which yields a very good return and need not get involved in other economics activities for profit.
    Look at their books and therein lies your answer.
    Also the Nigerian Government is borrowing a lot of money from the market with very juicy interest rate, so tell me why any bank should get involved in more risky economics activities in a country that still solely rely on oil.
    So the problem is not a situational one, but rather a systemic one, that has been going on for a long time.

    If am able to gather some capital and then meet up with the requirements to float a bank in Nigeria, all i need is a few core staff members who can trade money in the money market segment, then loan out money to a few oil and gas related businesses, and then employ a few contract staff in marketing to mobilise funds from people.


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.