Access Bank Plc plans to cut staff salaries to avoid downsizing its workforce as coronavirus continues to ravage the world and affect global economies, Bloomberg reported.
Bloomberg on Friday reported that “people with direct knowledge of the matter” said the pay cuts are expected to start from May unless business conditions improve.
The sources who were briefed on the matter during a conference call and asked not to be identified because they’re not authorized to speak publicly said some management members will get as much as a 40% decrease.
Access Bank had 6,898 permanent staff at the end of 2019, according to a presentation on its website.
Access Bank spokesman declined to comment when contacted by Bloomberg.
Major states in the country have been on lockdown since the index case of the virus was reported in the country. Many of the financial institution resorted to working from home to keep up with operations. But the crash in oil prices and the risk of a naira devaluation due to the pandemic poses a greater threat of rising bad-debt levels.
Banks in Lagos are expected to open for limited hours as from Monday, May 4. The restriction on working hours is expected to run for at least two weeks. The state government said it will review the restriction after two weeks.
Access Bank Plc plans to cut salaries to avoid job losses as a lockdown to contain the coronavirus hampers the operations of Nigeria’s biggest lender, according to people with direct knowledge of the matter.
The reductions are expected to start from May unless business conditions improve, said the people, who were briefed on the matter during a conference call and asked not to be identified because they’re not authorized to speak publicly. Some management will get as much as a 40% decrease, they said.
Nigerian banks are facing the threat of rising bad-debt levels as a crash in oil prices and the risk of a naira devaluation coincide with the Covid-19 pandemic that has shuttered businesses.
Access Bank, which acquired rival Diamond Bank Plc last year, had 6,898 permanent staff at the end of 2019, according to a presentation on its website. The acquisition partly contributed to a 31% increase in operating expenses. Personnel, recruitment and training costs account for more than a third of overheads after the deal boosted employee numbers and resulted in “wage harmonization” across the businesses.
