According to Bloomberg, Access Bank Plc plans to cut salaries to avoid job losses as a lockdown to contain the coronavirus hampers the operations of the bank.
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.
The outbreak was declared a global pandemic by the World Health Organization (WHO) on 11 March. This is when an infectious disease is passing easily from person to person in many parts of the world at the same time.
More than three million people are known to have been infected worldwide, but the true figure is thought to be much higher as many of those with milder symptoms have not been tested and counted.