In response to the increasing cost of living issue, Guarantee Trust Bank (GTBank), Nigeria’s most economical commercial bank, surreptitiously increased employee pay by 40% in September 2024.
An Associate Banking Officer (ABO) who currently makes ₦720,000 ($442), stated that he wasn’t expecting any increment before the sudden shock in the hike. In GTBank’s employment structure, which has fewer staff levels than other Tier-1 banks, an ABO is only one level above entry-level employees.
The bank, which takes pride in having a low cost-to-income ratio, made ₦1 in 2023 with just ₦0.29 spent, maintaining its position as the most profitable Tier-1 bank in Nigeria. Given that, based on last year’s figures, GTBank would now spend ₦0.30 to make ₦1, the pay increase will have little effect on the bank’s status among Tier-1 banks.
The bank paid at least three times less on salaries in 2023 than other Tier-1 banks, spending ₦45.1 billion ($27.7 million)*. According to the 2023 financial reports of all Tier-1 banks, GTBank still has the lowest salary bill among them, even after nearly halving its salary increases, bringing its total personnel cost to ₦63.1 billion ($38.7 million).
An inquiry for comments was not immediately answered by GTBank.
Nigerians are under a lot of strain as a result of President Tinubu’s economic reforms, which include two currency devaluations and the elimination of gasoline subsidies. The naira has lost almost 70% of its value about the dollar, and inflation has increased to 30%.
GTBank’s pay increase could have been implemented to stop competing banks from stealing staff as the bank responds to these economic shifts.
When some personnel departed GTBank for other banks and nations in 2022, the bank boosted the pay of its tech team. According to someone with intimate knowledge of the bank’s pay scale, a technology employee on the same level as an ABO makes about ₦1 million ($613), which is still higher than other employees in other divisions.
All 3,300 GTBank employees were impacted by the pay increase, which broke with the banking industry’s custom of granting such bonuses primarily to head office employees. For GTBank employees, this is the second pay raise in two years, but the first in 2024.
*Current exchange rate: $1 = ₦1630
