GTBank, Access Bank, Zenith Bank, FBN Holding, and 9 other banks listed on the Nigeria Stock Exchange (NSE) spent N271.64 billion on personnel expenses in the first half of 2020, compared to the N254.06 billion recorded in same period in 2019. Interestingly, this accrued increase occurred at a time several companies were cutting down on their costs.
According to checks by Nairametrics Research, the banks increased their expenses by over N17 billion during the period under review and this shows a 6.92% increase.
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Backstory: Nairametrics had reported, in Q1 2020 alone, that 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.
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Personnel expenses
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.
Comparing how much various banks paid their workers in H1 2020
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.
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What this means: 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 11,200 employees, according to information gleaned from its full-year 2019 financial statement.
| Banks | H1 2020 (N’m) | H1 2019 (N’m) | %change |
| Access Bank | 36,251 | 31,246 | 16.0% |
| FCMB | 14,148 | 13,964 | 1.3% |
| Fidelity Bank | 12,190 | 11,675 | 4.4% |
| First Bank | 49,537 | 46,775 | 5.9% |
| GT Bank | 18,776 | 18,579 | 1.1% |
| Jaiz Bank | 2,116 | 1,238 | 71.0% |
| Stanbic IBTC | 19,907 | 19,885 | 0.1% |
| Sterling Bank | 7,413 | 7,306 | 1.5% |
| UBA | 44,565 | 37,178 | 19.9% |
| Union Bank | 15,570 | 16,121 | -3.4% |
| Unity Bank | 5,253 | 4,738 | 10.9% |
| Wema Bank | 7,047 | 6,628 | 6.3% |
| Zenith Bank | 38,868 | 38,725 | 0.4% |
| Total | 271,642 | 254,057 | 6.9% |
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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. The bank has 6,521 employees.
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 but stands at 5,576 at the end of Q2 2020.
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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 June 2020 stood at 3,482.
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Surprisingly, Jaiz bank had the highest percentage 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.