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Banks Sack 2000 Workers in First Quarter 2020

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From Joy Okeke, Lagos

Data from the National Bureau of Statistics (NBS) has shown that Nigerian banks laid off 2,477 of their employees in the second quarter of 2020 due to economic disruption by the Covid-19.

The banking sector reduced its total headcount to 94, 498 as of June 2020 from 96, 975 in March of the same year.

Total banking sector employees was 103, 610 at the end of 2019.

The financial sector employees had taken to social media in the height of the Covid-19 lockdown to complain about the threat of mass sack and banks look to contain increasing overheads across the board.

 

Personal expenses makeup about 21 per cent of commercial banks operating income and are typically the first port of call for massive cuts.

According to the data, contract staff, which represented 43 per cent of total bank staff, constituted the most affected of the job cuts making up 2, 239 out of the 2, 477 losses recorded in the period.

The banks have since December 2019, laid off a total of 6, 408 contract staff. Staff designated as contract have always been an easy target for lay off as their contract do not provide them with the condition of service enjoyed by permanent staff.

In the wake of the Access Bank threat to downsize staff in April, the Central Bank of Nigeria (CBN) had to intervene to avert the mass sacking of staff.

The apex bank issued a statement confirming that it had agreed with banks to suspend the sacking of bank staff. 

The CBN maintained in the statement, “in order to help minimize and mitigate the negative impact of the COVID19 pandemic on families and livelihoods, no bank in Nigeria shall retrench or lay-off any staff of any cadre (including full-time and part-time).”

It directed the Money Deposit Banks to first get its approval before any staff is laid off in the event that it was absolutely necessary.

“To give effect to the above measure, the express approval of the Central Bank of Nigeria shall be required in the event that it becomes absolutely necessary to lay-off any such staff.”

However, the over 2000 staff laid off might have been effected under the approval of the central bank or carried out before the circular was made public.

Banks NPLs Raise to N1.21trn in 6 Months 

By Mathew Dadiya, Abuja

The Nigerian banking sector has recorded  a 14 per cent rise in Non-Performing Loans (NPLs) in the first half of 2020 ending a two-year consecutive decline in NPLs, since third quarter 2018.

The National Bureau of Statistics (NBS), in its latest report on the banking sector, noted that non-performing loans in Nigerian banks increased to N1.212 trillion at the end of June 2020, from N1.059 trillion recorded in December 2019, rising by N152.4 billion or 14.38 per cent in six months.

According to the report, at the end of the first half of 2020, Oil and Gas sector contributed the largest share to NPLs in Nigerian banks, recording a significant 22.2 per cent increase in NPLs from N219.91 billion recorded at the end of quarter four of 2019 to N268.79 billion in Q2 2020.

Construction sector recorded a 93.4 per cent increase, from N86.79 billion in Q2 2019 to N167.86 billion in Q2 2020.

One of the biggest contributors to NPLs in Nigerian banks was Commerce and Trade as it recorded a significant 17.5 per cent rise from N146 billion to N171.55 billion at the end of Q2 2020.

In spite of the rise in NPLs across critical sectors, some sectors including agriculture, transportation, power & energy, and education recorded a decline.

The recent upward trend in Non-Performing Loans is mostly attributed to non-payment of loans by bank obligors due to the covid-19 induced lockdowns. Nigerian banks have also seen their asset quality decline due to the fall in oil prices.

Earlier in the year banks cut a deal with the CBN as they were granted regulatory forbearance in the restructuring of loans. Over 33 per cent of industry loans are expected to be restructured as part of the deals signaling the spate of economic crunch that has hit the private sector.

A further deterioration in asset quality is likely to occur, particularly for vulnerable sectors like Oil and Gas, Manufacturing and Agriculture. This, however maybe mitigated by the planned restructuring of 33 percent of industry loans.

However, the CBN seems satisfied with the level of non-performing loan ratios as highlighted in its July Monetary Policy Committee (MPC).

“The Committee noted the decrease in NPLs ratio to 6.4 percent at end-June 2020 from 9.4 percent in the corresponding period of 2019, on account of increased recoveries, write-offs and disposals.

At N1.2 trillion Nigeria’s non-performing loans are still relatively low compared to previous years. 

But there are concerns that this may not be the true reflection of bad loans in the country considering the imminent recession and level economic crunch in the country.

Against the backdrop, pressure may start building on the banks, whose loan books have been hit by Nigeria’s shrinking economy, plunging currency, and foreign exchange shortages, following the slump in oil prices.

Business News

Budget Office Defends Tax Reform Acts, Seeks Due Process

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By Tony Obiechina, Abuja 

The Budget Office of the Federation has reaffirmed the integrity of Nigeria’s newly enacted Tax Reform Acts, cautioning against what it described as governance by speculation and unverified claims following allegations of post-passage alterations.

In a statement on Wednesday, the Budget Office said it had taken note of concerns raised by the Minority Caucus of the House of Representatives, stressing that the sanctity of the law is central to constitutional democracy and not a mere procedural formality.

According to the Office, any suggestion that a law could be altered after debate, passage, authentication, and presidential assent without due process would strike at the core of the Republic and undermine citizens’ right to be governed by transparent and stable laws.

However, it warned that democratic integrity is also endangered by the careless amplification of unverified claims. “A nation cannot be governed by insinuation or sustained on circulating documents of uncertain origin,” the statement noted, adding that public confidence, once shaken by speculation, is often difficult to restore.

The Budget Office emphasized that both government and citizens share a common interest in truth, clarity, and due process, noting that public finance depends heavily on trust in the legality and clarity of fiscal laws. It welcomed the decision of the National Assembly to investigate the allegations, describing institutional inquiry, not conjecture as the appropriate response to claims of illegality.

On public access to the law, the Office agreed that Nigerians and the business community are entitled to clear and authoritative texts of all laws they are required to obey. It clarified, however, that the authenticity of legislation is determined by certified legislative records and official publication processes, not by informal or viral reproductions.

The statement also underscored the importance of separation of powers, warning that claims suggesting Nigeria is being governed by “fake laws,” if not backed by established facts, risk eroding confidence in democratic institutions.

 At the same time, it stressed that legislative scrutiny should not be dismissed by the executive, noting that oversight is a constitutional duty, not an act of hostility.

From a fiscal perspective, the Budget Office said legal certainty is essential for revenue projections, macroeconomic stability, budget credibility, and investor confidence. While it is not the custodian of legislative records, it maintained that uncertainty around operative tax provisions directly affects economic planning.

To restore confidence, the Office proposed a set of measures, including the publication of verified reference texts in a single public repository, orderly access to Certified True Copies for stakeholders, clear public explanations where discrepancies are alleged, and strict alignment of all implementing regulations with authenticated legal texts.

Addressing calls for suspension of the tax reforms, the Budget Office cautioned against allowing prudence to slide into paralysis. It argued that properly implemented tax reform is necessary to reduce dependence on borrowing and inflationary financing, while easing indirect burdens on vulnerable citizens.

“Where clarification is required, it must be provided; where correction is required, it must be effected; where investigation is required, it must proceed,” the statement said, adding that governance and reform should not be stalled by unresolved conjecture.

The Office concluded by describing taxation as a democratic covenant that binds citizens and the state, insisting that compliance depends on transparency and trust. It called on political actors to protect institutions as much as positions, urging citizens and businesses to rely on verified sources and resist the spread of unauthenticated information.

The statement was signed by Tanimu Yakubu, Director-General of the Budget Office of the Federation, who reaffirmed the agency’s commitment to fiscal transparency, institutional integrity, and reforms that advance national prosperity while safeguarding citizens’ rights.

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Tinubu Congratulates Dangote on World Bank Appointment

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By Jennifer Enuma, Abuja

President Bola Tinubu has congratulated Alhaji Aliko Dangote, the President of Dangote Group, on his appointment to the World Bank’s Private Sector Investment Lab, a body tasked with promoting investment and job creation in emerging economies.

In a statement by Special Adviser on Media and Publicity, Bayo Onanauga, the President described the appointment as apt, given Dangote’s rich private sector experience, strategic investments, and many employment opportunities created through his Dangote Group.

The Dangote Group became one of Africa’s leading conglomerates through innovation and continuous investment.

Dangote Group’s business interests span cement, fertiliser, salt, sugar, oil, and gas. However, the $20 billion Dangote Petroleum Refinery and Petrochemicals remains Africa’s most daring project and most significant single private investment.

“President Tinubu urges Dangote to bring to bear on the World Bank appointment his transformative ideas and initiatives to impact the emerging markets across the world fully” the statement said.

The World Bank announced Dangote’s appointment on Wednesday, as part of a broader expansion of its Private Sector Investment Lab. The lab now enters a new phase aimed at scaling up solutions to attract private capital and create jobs in the developing world.

The CEO of Bayer AG, Bill Anderson, the Chair of Bharti Enterprises, Sunil Bharti Mittal, and the President and CEO of Hyatt Hotels Corporation, Mark Hoplamazian, are on the Private Sector Investment Lab with Dangote.

The World Bank said the expanded membership brings together business leaders with proven track records in generating employment in developing economies, supporting the Bank’s focus on job creation as a central pillar of global development.

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Business Analysis

Nigeria Customs Generates over N1.75trn Revenue in 2025

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By Joel Oladele, Abuja

The Nigeria Customs Service (NSC) has generated an impressive N1,751,502,252,298.05 in revenue during the first quarter of 2025.

The Comptroller-General (CG) of the Service, Bashir Adeniyi, disclosed this yesterday, during a press briefing in Abuja.

According to Adeniyi, the achievement not only surpasses the quarterly target but also marks a substantial increase compared to the same period last year, reflecting the effectiveness of recent reforms and the dedication of customs officers across the nation.

“This first quarter of 2025 has seen our officers working tirelessly at borders and ports across the nation.

I’m proud to report we’ve made real progress on multiple fronts—from increasing revenue collections to intercepting dangerous shipments,” Adeniyi stated.

He attributed this success to the reforms initiated under President Bola Tinubu’s administration and the guidance of the Honourable Minister of Finance and Coordinating Minister of the Economy, Olawale Edun.

The CG noted that the revenue collection for Q1 2025 exceeded the quarterly benchmark of N1,645,000,000,000.00 by N106.5 billion, achieving 106.47% of the target. This performance represents a remarkable 29.96% increase compared to the N1,347,705,251,658.31 collected in Q1 2024.

Adeniyi highlighted the month-by-month growth, noting that January’s collection of N647,880,245,243.67 surpassed its target by 18.12%, while February and March also showed positive trends.

 “I’m pleased to report the Service’s revenue collection for Q1 2025 totaled N1,751,502,252,298.05.

“Against our annual target of N6,580,000,000,000.00, the first quarter’s proportional benchmark stood at N1,645,000,000,000.00. I’m proud to announce we’ve exceeded this target by N106.5 billion, achieving 106.47% of our quarterly projection. This outstanding performance represents a substantial 29.96% increase  compared  to  the  same  period  in  2024,  where  we  collected N1,347,705,251,658.31.

“Our month-by-month analysis reveals even more encouraging details of this growth trajectory,” Adeniyi said.

In addition to revenue collection, Adeniyi said the NCS maintained robust anti-smuggling operations, recording 298 seizures with a total Duty Paid Value (DPV) of ₦7,698,557,347.67.

He stated that rice was the most seized commodity, with 135,474 bags intercepted, followed by petroleum products and narcotics.

“From rice to wildlife, these seizures show our targeted approach,” Adeniyi remarked, noting the NCS’s commitment to combating smuggling and protecting national revenue.

Adeniyi also highlighted key initiatives, including the expansion of the B’Odogwu customs clearance platform and the launch of the Authorized Economic Operators Programme, which aims to streamline processes for compliant businesses. The NCS’s Corporate Social Responsibility Programme, “Customs Cares,” was also launched, focusing on education, health, and environmental sustainability.

Despite these achievements, the CG noted that the NCS faced challenges, including exchange rate volatility and non-compliance issues. Adeniyi acknowledged the need for ongoing adaptation and collaboration with stakeholders to address these challenges effectively.

Looking ahead, the NCS aims to continue its modernization efforts and enhance service delivery, ensuring that it remains a critical institution in Nigeria’s economic and security landscape.

“Results speak louder than plans; faster clearances through B’Odogwu, trusted traders in the AEO program, and measurable food price relief from our exemptions. We’ll keep scaling what works,” he concluded.

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