There are indications that total banking staff strength fell by 11.1 per cent between first quarter (Q1) and Q4 2021 to 93,090.
This, according to the Q1-Q4 2021 Selected Banking Sector (SBS) data published by the National Bureau of Statistics (NBS) last week, is attributed to a 7.6 per cent, 11.2 per cent, and 12.5 per cent reduction in senior, junior, and contract staff strengths.
However, the report noted that the number of executive staff rose by 23.9 per cent to 249 over the period, though still below 0.5 per cent of the industry’s total staff strength.
Some financial experts from Lagos-based Afrinvest (West) Africa Limited said the situation might not be unconnected to the re-alignment in banking staff composition, which is a deliberate strategy targeted at optimising value amid growing challenges in the business environment.
“We observed a strategic shift in banks’ staff composition between 2018 and 2021.
“Notwithstanding, this is not a cheering development when considered from the perspective of job creation as Nigeria’s unemployment rate is already at a disturbing level (Q4:2020 unemployment rate: 33.3 per cent),” the experts observed in an e-mailed note.
Based on Afrinvest’s analysis, the Nigerian banking sector rebounded strongly in 2021 from the pandemic shock the prior year, growing interest income on loans, net fee and commission income, and profit after tax (PAT) by 26.2 per cent (to N2.0 trillion), 59.2 per cent (to N713.2 billion), and 6.1 per cent (to N739.5 billion) sequentially as against 15.4 per cent, 18.2 per cent, and 16.3 per cent contractions in 2020.
According to the analysts, this impressive performance resonates with the strong 10.5 per cent growth of the financial institutions’ Gross Domestic Product (GDP) in 2021, outperforming the broader economy by 710 basis points (bps).
The NBS had disclosed that the total operating expenses of the banking industry surged by 22.3 per cent to N2.2 trillion in 2021.
This momentum deviated from the 2019 (up by 3.3 per cent) and 2020 (down by 3.0 per cent) pattern, and industry watchers believe it is not unconnected to the surge in average inflation rate to 17.0 per cent from 11.4 per cent and 13.2 per cent in 2019 and 2020, respectively.
In terms of credit disbursement to the private sector, total allocation surged by 244.5 percent to N267.1 trillion. Industry (37.1 per cent) and the services sector (36.8 per cent) accounted for a combined share of 73.9 per cent of the total disbursement, while government, trade and general commerce, agriculture, and construction received 9.2 per cent, 6.7 per cent, 5.4 per cent, and 4.8 per cent, respectively.
Afrinvest noted that disbursement to oil & gas (49.5 per cent) and manufacturing (44.3 per cent) dominated credit allocation to the industry sector, while general services (25.8 per cent) and finance, insurance and capital market (17.5 per cent) received the chunk of flows to the services sector.
In terms of payment channel performance, the e-channel accounted for 88.2 per cent and 97.7 per cent of the total volume and value of processed payments in 2021, relative to 92.7 per cent and 97.6 per cent in 2020.
Of the e-channels, the internet/web transfers (40.2 per cent), POS (27.9 per cent), and ATM (15.2 per cent) accounted for the highest volume of transactions, while Real Time Gross Settlement (RTGS) transfers (55.3 per cent), internet/web transfers (27.6 per cent), and NEFT transfers (6.3 per cent) dominated in terms of value transacted.
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