Executive and non-executive directors of 10 banks received N17.79bn as sitting allowance and compensation in 2023, according to an analysis of the lenders’ financial statements.
The amount represents an increase of 2.2 per cent or N375.6m from N17.4bn the directors received in 2022.
The banks analysed were FBN Holdings and Guaranty Trust Holding Company, Zenith Bank and Stanbic IBTC.
Others include Sterling Bank, FCMB Group, Wema Bank, Fidelity Bank Plc, United Banks for Africa and Access Bank.
Some commercial banks in the country have increased the salaries and allowances of their employees, ranging between nine and 52 per cent 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 per cent and 50 per cent, 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.
However, an analysis of 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.
Zenith Bank 2023 spent N5.98bn in executive compensation, fees and sitting allowances, an increase of 9.92 per cent 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 per cent 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 per cent 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 per cent or N278m.
Only Access Bank cut its directors’ allowances by 37.2 per cent 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.”
The President of the Pragmatic Shareholders Association, Bisi Bakare, told The Punch that if the increase in directors’ emoluments positively affected all members of staff, it may not be a bad move.
“I’m not against it, but they should let us have the results because it would not be good for any bank that their directors’ remuneration would increase by almost 100 per cent but when you talk of gross earnings and other performance, it is static; even step back. Also, the increase in remuneration should go around. It should be for those in senior management and the junior staff.”
The immediate past National Coordinator of the Independent Shareholders Association of Nigeria, Dr Anthony Omojola, submitted, “We have to relate whatever is happening to the current event in the economy vis-à-vis the value of our currency. So, if the value of the naira has gone down seriously, as we have witnessed, then anyone who has the opportunity to increase their salaries should do so, but they should not overdo it.
“On the issue of salaries and emoluments for directors, I think there are a few things that they should keep in mind. If a company decides to raise directors’ emoluments, they should also consider what would be the return on investment.
“I have seen in some areas where the increase I feel is too much, but there is nothing one can do. Even when we talk, it is merely an observation, it doesn’t change whatever they want to do.”
He maintained that as long as the increase was done across the board, then it was okay.
“If there is a company that allows the salaries and allowances of its directors to go up, then, they should also consider the salaries of the staff generally. If that is taken into consideration, there is nothing wrong but if done arbitrarily, we will frown at it,” he concluded.
