- Zenith, FBNH pay highest reward, allowances increase by 2.2% from 2022
Despite daunting challenges in the banking sector and the economy, an analysis of the financial statements of 10 Nigerian banks has revealed that their executive and non-executive directors received N17.79bn as sitting allowance and compensation in 2023.
According to the breakdown, the amount represents an increase of 2.2 percent or N375.6m from N17.4bn the directors received in 2022.
The affected banks are FBN Holdings, Guaranty Trust Holding Company, Zenith Bank, Stanbic IBTC and Sterling banks.
Others are FCMB Group, Wema Bank, Fidelity Bank Plc, United Banks for Africa and Access Bank.
An analysis of the audited financial results and accounts for the full year ended December 31, 2023, showed that Zenith Bank, followed by First Bank, reported the highest sitting allowances and compensation, while Wema Bank reported the lowest.
In 2023, Zenith Bank spent N5.98bn in executive compensation, fees and sitting allowances, an increase of 9.92 percent from the N5.4bn reported in 2022.
It said 14 directors got paid a minimum pay of N5m or above.
For FBN Holdings, a total of N3.41bn was paid as emoluments to directors, an increase of 9.1 percent from N3.1bn recorded in 2022.
Stanbic IBTC Bank got the highest allowance increase of N980m from N2.12bn payout in 2022 to N3.13bn last year.
FCMB’s directors’ allowances rose by 15.2 percent or N330m to N2.16bn, Fidelity Bank paid a total sum of N1.04bn as emoluments and UBA coughed out N1.86bn.
Also, GTCO spent N1.27bn on directors’ allowances, while Sterling Bank’s directors’ allowances went up by 54.2 percent or N278m.
Only Access Bank cut its directors’ allowances by 37.2 percent from N1.1bn in 2022 to N687m in 2023.
The tier-one bank said in its report, “The Company has established a remuneration policy that seeks to attract and retain the best talent in the countries in which it operates. To achieve this, the company seeks to position itself among the best-performing and best employee-rewarding companies in its industry in every market that it operates.
“This principle will act as a general guide for the determination of compensation in each country. The objective of the policy is to ensure that salary structures, including short- and long-term incentives, motivate sustained high performance and are linked to corporate performance.”
Some commercial banks in the country have reportedly increased the salaries and allowances of their employees, ranging between nine and 52 percent to help them cushion the effect of petrol subsidy removal and the rising cost of living.
A report by KPMG Nigeria revealed that Wema Bank increased the salaries of employees to cushion the impact of recent economic realities.
Guaranty Trust Bank Plc increased salaries for junior and contract staff, with cleaners earning between N70,000 and N80,000, and drivers earning between N140,000 and N150,000 per month.
Zenith Bank Plc also increased salaries across the board, ranging between 25 percent and 50 percent, depending on staff level, with cleaners and drivers now earning between N80, 000 and N120, 000.
These have led to an increase in the cost of wages and salaries.
Six leading banks in the country generated mouth-watering returns for their shareholders in the 2023 financial year.
Another analysis of the six banks’ audited 2023 results showed that cumulatively, they generated about N3.11 trillion profits before tax, a growth of 216.4 per cent from the N982.5 billion they recorded in the 2022 financial year.
The banks are Zenith Bank Plc, Access Holding Plc, and United Bank for Africa Plc, Guaranty Trust Holding Company Plc (GTCO), Stanbic IBTC Holdings Plc, and Wema Bank Plc.
Further findings revealed that the six banks generated N2.6 trillion profits after tax in 2023, a growth of 224.4 per cent from N807.65 billion reported in 2022.
Consequently, the six banks have proposed a total of N444.52 billion as dividends to their shareholders for the 2023 financial year.
Nigerian banks benefited tremendously from the foreign exchange unification policy of the Central Bank of Nigeria that impacted on bottom-line results in 2023.
In the period under review, Zenith Bank sustained its position as the most profitable bank in Nigeria, followed by UBA and Access Holdings.
Analysis of the audited results showed that while Zenith Bank generated N795.96 billion profits before tax in 2023, a growth of 179.6 per cent from N284.65 billion in 2022, UBA declared N757.68 billion profits before tax in 2023, an increase of 277.2 per cent from N200.88 billion in 2022.
On its part, Access Holdings announced N729 billion profits before tax in 2023, a growth off 334.76 per cent from N167.68 billion declared in 2022, to join Tier-1 banks with over N700 billion profits before tax threshold in 2023.
For GTCO, it announced N609.31 billion profits before tax in 2023, an increase of 184.5 percent from N214.15 billiion reported in 2022.
In addition, Stanbic IBTC closed 2023 with N172.91 billion profit before tax, a growth of 72 per cent from N100.27 billion in n2022, while Wema Bank declared to investing public N43.66 billion profit before tax in 2023, an increase of 193.4 per cent from N14.88 billion in 2022.
