Taming the Bullock

Omar, NLC President

The Nigeria Labour Congress (NLC), task Governor of the Central Bank of Nigeria (CBN), Lamido Sanusi to intervene in several alleged unethical practices by the new management team of Union Bank Plc
By Bayo Amodu
Last August, when the Lamido Sanusi-led Central Bank of Nigeria, (CBN) sacked former Group Managing Director of Union Bank Plc, Barth Ebong, alongside five other GMDs of leading commercial banks in the country, many Nigerians applauded the bold step. Prior to the time, there had been ominous signs that the nation’s banking sector was habouring unprofessional practices. Therefore, when Funke Osibodu, a veteran banker and financial consultant with over 28 years experience in the industry was named asEbong’s replacement, some financial analysts and stakeholders applauded the change and vouched for Osibodu’s strong managerial and business skills as great assets for turning around the old generation bank.
However, a year after the Osibodu-led management of Union Bank Plc took over the running of the bank, all does not seem well with the hitherto Big, Strong and Reliable bank. The new management has been criticised severally with allegations bordering on mismanagement and executive high handedness among others. The Nigeria Labour Congress (NLC), recently joined the growing chorus by pointing out alleged misdeeds of the new management team.
In a letter to the Governor, CBN, Lamido Sanusi on August 12, the umbrella labour union accused the Osibodu-led management of jerking up salaries and allowances of current Executive Directors of the bank and of the GMD, not minding the bank’s parlous financial position. According to the NLC, the current Executive Directors now earnN68 million each per annum while the total emoluments of the GMD is shrouded in secrecy. The erstwhile GMD of the bank before he was sacked by the CBN was said to earn about N38 million per annum.
Also, the new management, according to the NLC, has paid two years housing grant in advance totaling N180 million and tax-free medical grants of $120,000 for each director. The new management, in complete disregard for the Bank’s stark economic realities, purchased two bullet proof Mercedes ‘S’ Series Jeeps for the GMD /Chief Executive, at a total cost of N40 million in addition to new Mercedes ‘E’ Series purchased for the four Executive Directors, despite the various exotic vehicles inherited from the immediate past management which the NLC said the management could not account for.
The Source learnt that Union Bank Plc is unique in the sense that the workforce is the major stakeholder in the shareholding structure of the bank. And this unique relationship was said to have given pep to the workers commitment to closely scrutinise the operations of the bank in order to ensure her sustainable growth. However, the labour union revealed that strangely, treasured customers of the bank are now being hounded out of the bank with their deposits and good will by the new management, leaving staffers of the bank at crossroads as to whose interest the management team could be serving with an antagonistic posturing against long standing customers of the bank.
In addition, over $500 million deposits of key customers won by the former management were said to have been ceded to other competitors of Union Bank. For instance, the NLC alleged that $70 million received from the Benin Republic subsidiary of the bank was placed in a branch of United Bank for Africa (UBA) United Kingdom instead of Union Bank branch in the same country.
An underground plan to sell the bank cheap is said to be ongoing, the NLC surmised. It’s letter read in part: “The ridiculous values attached to the various assets of the bank is another attempt to further make the bank cheap for the cronies of the present management to acquire,”
In order to achieve this, the NLC alleged that the incumbent management has cooked-up a pattern of book keeping, skewed towards giving the impression of a totally weak bank so as to ensure its liquidation or sale.
For example, the value of the bank’s fixed assets shrunk from N79.522billion in December 2009 to N62.111billion as at June 30,2010. According to the NLC, this is part of the scheme by the management to present the bank for eventual sale.
Ironically, despite the poor financial state the bank is said to be battling the new management has been on a recruitment binge, employing high wage senior personnel in their numbers. These employees, The Source learnt, have no career exposure comparable to existing staff but are being paid bumper remunerations and placed on unjustifiable grades. Also, almost all the new management staff employed are said to be from the same ethnic group with the GMD.
The Source gathered that as a result, the core staff of the bank have been deliberately moved from sensitive duties like foreign operations, Human Resources Risk Management and Corporate Banking. A staff within the bank who pleaded anonymity told The Source that the management perpetuates these nefarious acts without any challenge. He added that the phoney provisions on gratuity and unbalanced books were obviously made to erode the capital base and overall shareholders’ fund. Incidentally, those that have been resolved have not been reversed, ultimately to sustain the poor perception of the bank with a view to eroding both patronage and confidence of the banking public.
The NLC also alleged that records of unfair labour relations and attitude being exhibited by the Osibodu-led management team is second to none in the industry. Collective agreement, the NLC said, have been unilaterally discarded by the management team. And a deliberate attempt by the management to undermine workers’ solidarity and classify employees along Union and “un-unionized” lines is said to be in place. The failure of the new management to promote staff as at when due, The Source learnt, is already having a negative impact on motivation, manpower planning, growth and development of the bank.
Other alleged unprofessional industrial relations practices leveled against the management of the bank include the dismissal of 37 staff for overdrawing their accounts, even when Osibodu’s account was overdrawn within the same period; unwarranted and illegal termination and dismissal of 223 employees of the bank and refusal to act on the report of the committee that reviewed available files more than three months after; and unilaterally tinkering with staff salary structure with the intention to pay ridiculous gratuity and pension to the staff who toiled over several decades to build the bank. Also, the decision of the management to revert to the use of employer’s emoluments as at 2005 in the computation of pension entitlement was described as illegitimate and unacceptable.
The Labour union reiterated its mandate, which is to protect every Nigerian worker and described the management team of the bank as insensitive to the need to nurse the bank back to financial health. It, therefore, demanded that the CBN governor should deploy a competent and experienced Human Resources practitioner within the bank to man the bank’s Human Resources Department. Also, the NLC wants the management team of the bank to continuously consult with the workers’ representatives on all issues that affect them directly.
The discriminations against traditional Union Bank staff, which according to the NLC was epitomised in their deliberate movement from sensitive duties like foreign operations, Human Resources among others as well as retrenchment of employees must be done away with. The Labour union also demanded that staff whose appointment were terminated but whose files could not be traced for review must be recalled to duty forthwith and that the management should attend to all outstanding promotions without further delay.
The NLC further demanded that the management should revert to the pre-July 2010 salary structure and enter into meaningful negotiations with the Union, with a view to harmonising employee entitlements. In addition, they want all employment made from August 14,2009 to date reversed, as consideration was not given to existing employees in line with the provisions of the Collective Agreement, and that all identified vacancies should be filled from within the bank. Existing staff, according to the Labour union, should be trained to meet any knowledge gaps which may have been identified by the management.
Lastly, the NLC demanded from the CBN governor firm assurance that the shareholders of the bank be given enough time to recapitalise the bank. “We demand that all unnecessary provisions debited to shareholders fund be reversed immediately to give the true position of the bank. The amounts debited to the shareholders fund as unbalanced accounts which have now been reconciled must be immediately reversed,” the NLC said.
When The Source sought the reaction of Union Bank Plc on the allegations levelled against it, the Corporate Affairs Officer of the bank, Francis Barde said since the allegation was not forwarded to the management of the bank directly, it was not proper for him to make any comment on the matter. "We are operating under regulation. The letter was not directed to us. It was addressed to the CBN governor,” Barde said.
The Source sought the reaction of Union Bank Plc on the allegations levelled against it, the Corporate Affairs Officer of the bank, Francis Borde said since the allegation was not forwarded to the management of the bank directly, it was not proper for him to make any comment on the matter. "We are operating under regulation. The letter was not directed to us. It was addressed to the CBN governor,” Barde said.
All attempt to get the response of the CBN proved abortive as repeated calls made to the Corporate Affairs Manager, Mohammed Abdulahi were not responded to.
The Source learnt that the status quo at Union Bank has so far remained as no directive has come from the CBN for the Osibodu-led management to effect any of the demands.
What then will be the next line of action? The banking public and stakeholders in the industry expect answers in the days ahead – especially against the backdrop of whispers that the workers are gearing up to flag-off, this week, a series of actions aimed at bringing the bank's management back to its senses.