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Diamond Bank Fires 200 Workers

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Diamond Bank

Diamond Bank Plc has fired 200 members of its workforce as the economic challenges affecting the country continue to batter the financial services industry.

This is coming two months after the bank announced that its profit before tax for the first quarter of this year fell to N6.04bn from the N7.94bn it recorded in the first quarter of 2015.

The slowdown in the economy has fuelled a high non-performing loan rate in the banking system, causing banks to record sharp decline in their profits for the 2015 financial year and the first quarter of 2016.

Diamond Bank was said to have fired the workers on Friday.

Confirming the development in a statement on Tuesday, the lender said the sacking of the 200 workers was in line with its strategic plan to drive shareholders’ value.

The statement read, “Diamond Bank recently rightsized its workforce. The rightsizing was a core strategic exercise in line with the bank’s growth objective and the will to continue the drive to optimise cost and enhance value for the shareholders at the end of the business year.

“In the bank’s last appraisal, only 200 staff whose performance scorecards were adjudged to be lower than the minimum required to drive its strategic growth plan for the business year were relieved, with the opportunity to seek employment in other organisations where their respective skills set and individual performances could be enhanced and optimised.

“The yearly appraisal is a general industry standard and enables banks to prune their workforce and prudently allocate resources for optimum result. Diamond Bank is not an exception in the industry and therefore, had carried out its annual appraisal and found the performance of members of staff that were relieved to be below the required minimum performance level that would sustain them in the system. With its trim-and-fit workforce, the bank is sure to meet its target for the current business year.”

However, unconfirmed reports had it that the number of workers who were asked to go was in the region of 400.

The reports stated that the lender was aiming to reduce its N800m monthly wage bill significantly and was also considering pruning workers in the managerial cadre by 80 per cent, a claimed that Diamond Bank denied.

FBN Holdings, the parent company of First Bank of Nigeria Limited, had a few weeks ago said it would reduce costs by gradually cutting down on its workers by 1,000.

This came after the group posted over 80 per cent decline in its profit for the 2015 financial year.

Bad loans in the banking industry rose sharply by 78.8 per cent to N649.63bn in 2015, indicating severe deterioration in the quality of the loan portfolio of the 22 banks, a Central Bank of Nigeria staff report presented to the Monetary Policy Committee revealed.

The report also showed a general increase in bad/non-performing loans among the 22 Deposit Money Banks in the country. This was despite the 30 per cent decline in new loans granted by banks in 2015 to N5.78tn.

According to the report, 18 out the 22 banks recorded increase in bad loans. Furthermore, the number of banks that exceeded the regulatory limit of five per cent for the ratio of bad loans to total loans rose from three in 2014 to eight in 2015, with three banks exceeding 10 per cent.

Economic and financial analysts believe more lenders will lay off a significant number of their workers in the coming months as they battle bad loans, regulatory headwinds and slowdown in the economy.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

Stanbic IBTC Obtains Approvals, License to Establish Life Insurance Subsidiary

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stanbic IBTC Insurance

Stanbic IBTC Holdings Plc on Friday announced that it has obtained all required Regulatory Approvals and a license from the National Insurance Commission to establish a wholly-owned Life Insurance subsidiary, Stanbic IBTC Insurance Limited (SIIL).

In a statement signed by Chidi Okezi, Company Secretary, Stanbic IBTC and released on Friday, the bank said “The establishment of this new subsidiary essentially complements the bouquet of product offerings by Stanbic IBTC as it continues its goal of being the leading end-to-end financial solutions provider in Nigeria. In this regard, SIIL will aim to facilitate long term insurance for already financially included individuals and will seek to become the preferred Insurer in the Life Insurance Business.

“Stanbic IBTC Holdings PLC, a member of Standard Bank Group, is a full-service financial services group with a clear focus on three main business pillars – Corporate and Investment Banking, Personal and Business Banking and Wealth Management. The group’s largest shareholder is the Industrial and Commercial Bank of China (ICBC), the world’s largest bank, with a 20.1% shareholding. In addition, Standard Bank Group and ICBC share a strategic partnership that facilitates trade deals between Africa, China and select emerging markets. Standard Bank Group is the largest African financial institution by assets. It is rooted in Africa with strategic representation in 21 countries on the African continent.

“Standard Bank has been in operation for over 158 years and is focused on building first-class, on-the-ground financial services institutions in chosen countries in Africa; and connecting selected emerging markets to Africa by applying sector expertise, particularly in natural resources, power and infrastructure.”

 

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World Bank to Discuss New $1.5 Billion Loan Request From Nigeria

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Zainab Ahmed

The Finance Minister, Budget and National Planning, Mrs. Zainab Ahmed, on Friday said the Federal Government has met all the conditions for a fresh loan of $1.5 billion from the World Bank.

The minister disclosed this on Bloomberg TV.

She said the multilateral financial institution is in the final stage of approving the loan. The minister explained that the loan will be discussed in the bank’s next meeting and possibly be approved in the same meeting.

In June, the Senate approved the borrowing plans but the World Bank pushed back demanding Nigeria fulfill the conditions attached to the $3.4 billion loan received from the International Monetary Fund (IMF) in May.

Some of the conditions were to increase revenue generation by upping VAT, the introduction of tariff reflective electricity bill, the removal of subsidy and the unification of the nation’s foreign exchange.

Most of which the Federal Government has done despite protests from most Nigerians who called the new policies anti-people given their current situation.

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Nigeria Realises Over N400 Billion from Company Income Tax in the Third Quarter of 2020

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tax relief

The Federal Government realised N416.01 billion from Company Income Tax (CIT) in the third quarter of the year, according to the latest report from the National Bureau of Statistics (NBS).

This was 3.48 percent higher than the N402.03 billion generated in the second quarter of the year and represents a decline of 20.13 percent year-on-year from N520.89 billion realised in the third quarter of 2019.

A breakdown of the report showed the professional services sector including the telecoms generated the highest amount of CIT at N55.52 billion during the quarter, while the manufacturing sector followed with N42.03 billion.

The banking and financial institutions realised N24.05 billion while the mining generated the least and closely followed by Textile and Garment Industry and Local Government Councils with N120.93 million, N167.51 million and N321.72 million generated, respectively.

The report added that out of the total amount realised during the quarter under review, a sum of N244.70 billion was generated as CIT locally. The federal government collected N70.34 billion as foreign CIT payment and the remain N100.97 billion was received as CIT from other payments.

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