Access Bank’s Wigwe Takes 40% Pay Cut in Effort to Reduce OPEX

May 1, 2020
herbert wigwe Access Bank

By Dipo Olowookere

In an effort to reduce the operating expenses (OPEX) of the company, the Group Managing Director of Access Bank Plc, Mr Herbert Wigwe, has said he will agree to slash his salary by 40 percent.

Mr Wigwe, in a video making the rounds where he had a chat with employees of the financial institution, said he will expect other members of staff of the organisation to accept cuts in their salaries.

An analysis by Business Post showed that in the 2019 financial year, Access Bank spent about N76.9 billion as personnel costs, below FBN Holdings and Zenith Bank, which used N99.3 billion and N77.8 billion respectively for the same purpose in the same period.

While United Bank for Africa (UBA) Plc spent N76.9 billion as personnel expenses, Guaranty Trust Bank (GTBank) Plc spent N37.2 billion.

Business Post reports further that in the first three months of this year, Access Bank spent N19.6 billion on personnel costs, higher than N12.8 billion in the same period of last year.

Also, other operating expenses rose sharply to N63.6 billion in Q1 2020 from N37.4 billion in Q1 2019 and this and others contributed to the decline reported in the bank’s profit after tax (N40.9 billion versus N41.2 billion in Q1 2019).

Since the beginning of this year, the world has been battling with coronavirus disease and it has affected many businesses, including those in Nigeria.

For over a month, many employees of companies in Lagos, Abuja and Ogun State have been working from home due to lockdown declared in the three places to curb the spread of COVID-19.

Offices are expected to reopen for business from Monday, May 4, 2020 and they would be allowed operate from 8am to 3pm because of a 8pm to 6am curfew announced by the federal government.

This week, the Lagos State Governor, Mr Babajide Sanwo-Olu, stated that companies to be allowed to resume operations from next week should have about 60 percent of their workforce back to offices.

This means some employees may still have to work from home.

Worried about its huge operating costs, the Access Bank chief said management will carry out some measures, including pay cuts and massive retrenchment of staff.

“We basically have to make the adjustments the same way you sounded when we spoke 10 days ago with respect to basically cutting down cost.

“I will be the first to take the hit and I’m going to take the largest pay cut, which would be as much as 40 percent.

“The rest we would have to cascade right through the institution. Everybody may have to make some adjustments of some sort.” Mr Wigwe informed employees of the tier-one lender in a video-conferencing meeting.

On trimming the company’s workforce, he said 75 percent of the bank’s staff, most of whom are outsourced and are offering non-essential services would have to go.

“We probably don’t need as many security men as required, even to the fact that we are not going to have all our branches open between now and December.

“We don’t need all the tea girls. We don’t need all the cleaners. We don’t need all the tellers etc,” Mr Wigwe said in the video.

Dipo Olowookere

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

Mr Olowookere can be reached via [email protected]

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