Banking on Austerity

Sanusi Lamido Sanusi, governor, Central Bank of Nigeria

More and more bank employees cry out against new stringent policies, which they claim are more austere than what obtains in other sectors
By Bayo Amodu
It is no longer news that the Nigerian banking sector is facing intense challenges, as the ongoing glo-
bal economic meltdown
bites harder on many
economies of the world. The negative impact of this, especially on bank workers , is now generating so much concern among their family members and stakeholders in the sector, as well as the Nigerian public.
“If I die today, it is not the work of any witch, or any sickness, but because my job, which is now becoming more stressful while fringe benefits I used to enjoy are no longer there, is the root cause of such a likely death,” enthused Sylvester Adigun, employee of a new generation bank in Lagos.
Last week, Adigun was informed by his bank that if he did not perform creditably in his half-year appraisal, which comes up at the end of this month, June 2009, his stay in the bank will be over, meaning, he will be thrown into the labour market. The threat, to Adigun, a family man with five mouths to feed, and an extended family to cater for, sounds like a death sentence.
A staffer of one of the old generation banks who corroboratated this anxious situation of things, said his financial and calendar year targets had been reviewed upward twice recently. He told The Source that he has been mandated to rake in no less than N70 million at the end of this month and an additional N80 million by the end of the year, with varying sanctions for different levels of performance. A less than 40 per cent performance, according to him, attracts a warning letter, while poorer performance may lead to dismissal.
“Where will I get that from at this time when there is no money anywhere? I’ve resigned myself to fate. The world will not come crashing on only me,” the obviously distraught staffer told The Source.
Indeed, many bankers appear to have been caught in the web, as quite a number of jobs in the industry are currently hanging in the balance owing to poor performance in the routine half-year appraisal reports coming up soon. The Source’s findings show that these appraisals, which are monthly, half-yearly and two years in tenure have now assumed a frightening nature, compounded by the ongoing global financial crisis. The Source also learnt that, formerly, a bank staff can only lose his/her job after performing below average for two years.
However, the current trend, in the wake of the global financial crisis, is that most banks that have been looking for opportunities to trim down their workforce now see the appraisal scheme as a ready tool. To this effect, some banks no longer stick to the two-year period, as they have hinted their staff that the big stick will come down on anyone who performs poorly consistently for six months. The half-year appraisal report, according to investigations by The Source, are usually sent to the banks’ Human Resource department.
Also, consistent poor performance for three months usually attracts a reprimand and an additional grace of three months to improve. However, after the six months, allowed and no improvement is recorded, The Source gathered that such staff in the current dispensation will lose his/her job. This is against the former practice of ‘accepted’non-performance for a two-year period.
The approach by virtually all the nation’s banks is seen as an attempt to whittle down the salaries of their employees, as the global financial crunch begins to take huge toll on operations. The Source also learnt that while some banks structure their workers’ pay on the scale of 20 per cent variable payment, others opted for 50 per cent. This means that out of the 100 per cent monthly pay package of an employee, 20 per cent is dependent on successful delivery of the workers’ monthly deposit target. What this means is that if a worker fails to deliver the target, he or she forfeits 20 per cent of the salary for that month. The same goes for those operating the 50 per cent variable payment system.
Officials of the affected banks told The Source that the policy was not unconnected with the uniform year-end policy for the banks at the end of this year. The banks, according to these officials, are in the rat-race to boost their bottomlines, while the marketers are left to grapple with the daunting hardship associated with their employers’ austerity measures.
A top executive in one of the big banks that made the Forbes’ list of top 2,000 world biggest companies, also revealed that it has become difficult for many of his colleagues to cope with the changing times, adding that loans, which many of them relied on to ‘live big’ were no longer readily available.
His words:“Before now, a banker did not have to worry about getting or furnishing a house after his wedding. The house, the cars and every furniture required, including kitchen equipment are most times obtained through easy loan arrangements, which bankers are used to anyway.
“But that no longer comes easy even in the biggest banks, so we now have to cut our cloth according to our size, which is very difficult. The most difficult aspect of it is having to cope with fees of children already in schools where they pay high fees,” he said.
The banker also revealed that in the banks, these days, almost all loans are currently tied to performance. For instance, it would require the beneficiary to have met 70 per cent of his key deliverables before being considered.
“This is not realistic. When the public is saying that banks are not giving loans, we are also affected, and it is not the fault of the banks but due to the financial meltdown,” he added.
Another employee of a Nigerian bank who claims he had worked with four banks in 12 years linked the dwindling fringe benefits associated with bank jobs to the recent clampdown on Saturday banking by most banks.
“There were agitation for a more flexible working arrangement, so that we can be closer to our families since the motivations for sacrificing important aspects of our lives are really not there again. Most banks have either reduced their working hours or cancelled outrights, odd day jobs,” he observed.
He added that staffers of most of the banks have forgotten about up-front payments, which usually helped them to execute important projects. “There is no job security anywhere again, so we are being paid our worth at the end of every month. The bank can no longer risk any advance salary payments,” he further stated.
As the banks continue to trugde on in the rat-race towards having robust capital base by December 31, 2009, The Source’s findings reveal that the over-riding implication is that the end of the year is bound to throw up a lot of possibilities hitherto unknown to the Nigerian banking clime.