Access Bank Plc has notified staff of its decision to cut salaries and temporarily downsize its workforce as part of management’s strategies to survive the economic effects of Coronavirus ( COVID-19).
Addressing members of staff via a video conference call tagged “employee town hall meeting” on Thursday, the Managing Director, Access Bank Plc, Mr Herbert Wigwe said he will be the first to take a 40 per cent cut and hinted that the same will apply to other management staff before cascading to other junior employees.
According to him, Access Bank has entered discussions with some outsourced services companies aimed at rationalizing about 70 per cent of its junior workforce especially cleaners, security men, tea girls, bank tellers among others.
Wigwe in a viral video from the town hall meeting said the bank will rationalize to the level that meets a customer service-oriented institution and meets the lender’s needs.
His words: ” I will be the first to take the hit and I am going to take the largest pay cut which will be as much as 40 per cent. The rest has to cascade right through the institution. Everybody had to make some adjustment of some sort.”
Wigwe acknowledged that this is not the best of times, and added that the bank’s management understands what people are going through but equally understands the higher calling of creating an institution “that can continue to provide for us.”
He further stated that Access Bank is considering keeping some branches partially closed till December and shall revert to what is normal when things do improve.
“We know it is a difficult decision. We appreciate the fact that it is going to hurt people, but we have to make that adjustment to ensure that we protect our franchise and make us stronger,” Wigwe said.
As a lockdown to contain the coronavirus hampers operations, the lender among other measures said the reduction in salaries is expected to start from May unless business conditions improve.
A top executive of the bank who attended the briefing but preferred anonymity because he was not authorized to speak for the bank told Nigerian Tribune that the management’s decision did not come as a surprise to the top executives of the financial institution considering that a good number of its staff had been “working from home” since the beginning of the lockdown.
Although Access Bank recorded a profit after tax of N40.9 billion in the first quarter which ended March 31st, 2020, the tier-1 bank incurred a total cost of N19.6 billion in personnel expenses. This represents a 53.5per cent jump compared to N12.8 billion in Q1 2019.
ALSO READ: We’re deporting Illegal miners to prevent community transmission of COVID-19 ― Osun govt
In the same vein, other operating expenses jumped sharply to N63.5 billion, marking a 69.8 per cent increase when compared to N37.4billion in Q1 2019.
This is according to the company’s financial statement for Q1 2020, which was released recently.
Access Bank, acquired rival Diamond Bank Plc last year and the acquisition swelled its staff strength to 6,898 at the end of 2019, according to a presentation on its website. The acquisition partly contributed to a 31 per cent increase in operating expenses, as 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.
and then