Business
Nigeria’s top banks rake in billions while keeping salaries tight
Nigeria’s leading banks are demonstrating an impressive combination of profitability and operational efficiency. Recent data indicates that the most lucrative financial institutions in the country are achieving strong earnings while keeping personnel costs remarkably low. This strategic approach seem to position the sector for sustainable growth, enhanced competitiveness, and better returns for investors, establishing a new benchmark for performance in Africa’s largest economy.
The banks in this category include GTCO Group, UBA Group, Zenith Bank Group, FBNH, Access Bank Group, Fidelity Bank, and Stanbic IBTC Group.
According to financial data released by NGX Group Limited for the year ending 2024, First Bank Nigeria Holding Company (FBNH) allocated N308.472 billion for personnel costs, marking a 75 percent increase from the N175.901 billion spent in the previous year.
Access Bank Group spent N381.414 billion on staff in 2024, representing a significant 127 percent rise from the N167,903 billion spent in 2023. Meanwhile, Stanbic IBTC’s expenditure on staff reached N243,689 billion in 2024, also a 127 percent increase from N166,807 billion in 2023. UBA Group committed N314,660 billion to personnel expenses in 2024, reflecting a 72 percent increase from N182,812 billion in 2023.
GTCO Group’s staff costs amounted to N85,397 billion in 2024, an 89 percent increase from N45.097 billion the previous year. By the end of 2024, NGX data revealed that Zenith Bank had allocated N204,170 billion for personnel expenses, 64 percent higher than N124,415 billion spent in 2023. Additionally, Fidelity Bank’s staff costs in 2024 were recorded at N73,450 billion, an 18 percent increase from N62,284 billion in 2023.
Despite these commendable figures, experts caution that a lack of balance can have detrimental effects. They warn that while some banks may lead in revenue and net income, disproportionately low personnel expenses could raise concerns about operational efficiency, automation trends, and the future of employee welfare in the sector.
Experts further enumerated the dangers of prioritizing profit over staff welfare.
According to them, when employees start to feel that their organization doesn’t value or respect them, their perception of the workplace quickly worsens. They may begin to feel disconnected, ignored, or even betrayed. This makes it harder for them to trust leadership or feel proud of where they work.
As a result, they noted, creativity and teamwork start to disappear. People no longer feel motivated to share new ideas or work closely with their teammates. Meetings feel awkward, projects slow down, and the energy that once fueled innovation dries up.
In this negative environment, they observed, ethical blind spots can start to form. People might ignore small mistakes or even bad behavior because they feel like no one cares. Over time, this can lead to bigger ethical problems that hurt the organization even more.
Employee retention also takes a hit. Good workers, feeling unappreciated and unhappy, start looking for new jobs elsewhere. The organization is left struggling to keep its best talent and has to spend more money and time hiring and training new people.
Meanwhile, customer loyalty weakens. As employees disengage and service quality drops, customers notice. Some start to leave, turning to competitors who can offer better experiences, causing customer churn to increase.
They noted that, with fewer ideas, fewer good workers, and unhappy customers, the overall risk to the organization grows. Problems that could have been spotted early are missed, small issues turn into big ones, and the company’s future becomes much less secure.
Commenting on the issue, former President of the Chartered Institute of Bankers of Nigeria (CIBN), Mazi Okechukwu Unegbu, told Business Hallmark in a telephone interview that many had long observed the growing imbalance and strained relationship between bank employees and their employers.
Unegbu noted that the increasing prioritization of profit over staff welfare was a major contributor to rising corruption and poor employee attitudes towards banks, ultimately leading to further operational challenges for the institutions.
“One of the main reasons corruption is on the rise in banks,” he explained, “is the lack of investment in staff training and loyalty-building initiatives. Training programs that once instilled commitment to the banking profession have been abandoned, and as a result, mistakes and unethical practices are becoming more common.”
He pointed out that basic errors, such as giving customers incorrect account balances, have become frequent, largely because employees are disengaged and demotivated.
Advising on the way forward, Unegbu recommended that banks should ensure that staff remuneration packages align with the realities of the economy and reflect genuine concern for employee well-being.
“If banks prioritize the welfare of their employees and reintroduce strong training programs, I believe the industry will gradually return to its former standards of excellence,” he concluded.
However, the recent audited financial statements submitted to the Nigerian Exchange (NGX) reveal strong performance by the leading banks, which together control at least two-thirds of the industry and are deemed systemically important due to their considerable influence. The results for 2024 indicate consistent growth in both profitability and asset bases, suggesting a positive industry trend and a stable outlook. Notably, profit growth in 2024 resulted from operational improvements rather than extraordinary factors such as foreign exchange (forex) revaluation gains, which had significantly inflated profits in 2023.
Summary of banks’ key performances:
United Bank for Africa (UBA): UBA maintained its top position with the largest asset base, increasing from ₦20.6 trillion in 2023 to ₦30 trillion in 2024. Pre-tax profit rose from ₦757.68 billion to ₦803.72 billion, while net profit increased from ₦607.7 billion to ₦766.6 billion.
Zenith Bank: Zenith experienced a substantial rise in profit before tax, increasing from ₦795.96 billion in 2023 to ₦1.32 trillion in 2024. Its net profit surpassed the trillion-naira threshold, climbing from ₦676.9 billion to ₦1.03 trillion, with total assets growing from ₦20.4 trillion to ₦29.96 trillion.
Guaranty Trust Holding Company (GTCO): GTCO showcased impressive performance with pre-tax profit more than doubling from ₦609.3 billion in 2023 to ₦1.27 trillion in 2024. Its net profit grew from ₦539.66 billion to ₦1.02 trillion, and total assets increased from ₦9.7 trillion to ₦14.8 trillion.
First Bank Holdings (First Holdco): This holding company reported a more than twofold increase in pre-tax profit from ₦356.15 billion in 2023 to ₦862.39 billion in 2024. Net profit soared from ₦308.4 billion to ₦736.7 billion, with total assets rising from ₦16.9 trillion to ₦26.5 trillion.
Stanbic IBTC Holdings: Known for its significant foreign ownership, Stanbic reported that profit before tax climbed from ₦172.91 billion in 2023 to ₦303.8 billion in 2024. Likewise, net profit grew from ₦140.62 billion to ₦225.3 billion, and total assets expanded from ₦5.15 trillion to ₦6.91 trillion.
Historical performance data also reveals similar upward trends:
Fidelity Bank: In the year ending December 2014, Fidelity Bank’s profit after tax saw a significant increase of 78.73%, reaching ₦13.8 billion compared to ₦7.72 billion in 2013. Profit before tax similarly rose by 72.33% to ₦15 billion.
Access Bank: During the same period, Access Bank boosted its revenue generation, with gross earnings increasing by 18.5% to ₦245 billion. Profit before tax grew by 21%, moving from ₦43 billion in 2013 to ₦52 billion in 2014.
These results illustrate a broader trend of increasing profitability and expanding balance sheets among Nigeria’s major banks, reinforcing confidence in the sector’s future stability and growth.
