Vanguard (Lagos)

30 March 2010

Nigeria: Equitorial Trust Bank Fires 150 Staff

Equatorial Bank yesterday fired 150 staff in a bid to restructure its operations for increased efficiency.

ETB is one of the eight banks rescued by the Central Bank of Nigeria (CBN) following the result of its special bank audit last year.

According to a source close to the bank, the retrenchment was in compliance with the directive of the CBN that the management of the rescued banks should reduce staff strength by 30 per cent.

The other rescued banks are Oceanic Bank, Intercontinental Bank, Finbank, Afribank, Bank PHB, Spring Bank, Union Bank.

In compliance with the directive of the apex bank, these banks have sacked about 10,000 staff between October and last month.

The 150 staff sacked by ETB is about five per cent of its almost 1,000 workforce.

One of the affected staff told Vanguard that the sack letter was distributed yesterday morning. But management of the bank is, however, silent on the gratuity of the sacked staff.

It was gathered that the sacked staff only said that the outstanding allowances are been compiled.

It would be recalled that following the sacking of the executive directors and one of the non-executive directors, shareholders of the bank pledged to rectify the lapases revealed the special bank audit of CBN including fresh capital injection.

A statement form the CBN to this effect stated "Following the special examination of all banks operating in the country, and the subsequent actions by the CBN, the shareholders of Equitorial Trust Bank Limited requested the permission of the CBN to be allowed to rectify lapses identified in the bank.

"In pursuance to that, the shareholders executed a Deed of Covenant, the specific terms and conditions of which included the following:

"i. The willingness of the shareholders to recapitalize the bank by way of injection of additional capital latest by June 30, 2010;

"ii. Restructuring, diversification and enlargement of the capital base of the bank either by way of a public offering of shares, securing a core investor or merger with a local bank within one (1) year period;

"iii. Addressing the corporate governance issues in the bank which were mainly ascribed to the previous Executive Management team in the bank;

"iv. Reconstitution of the Board of Directors of the bank through the retirement of two non-executive directors and the appointment of four new non-executive directors, including Dr. Mike Adenuga Jnr. (CON), an erstwhile member of the board, subject to the approval of the CBN; and "v.

Convening a general meeting of the bank's shareholders to ratify, through a resolution all the nominated appointments to the bank's board.

"Having reviewed the terms and conditions of the Deeds of Covenant, CBN has consented to the request aimed at further strengthening the bank. In granting these requests, CBN noted that the special examination had not raised issues of serious supervisory concern or criminal activity by any member of the Board of ETB.

"The CBN will closely monitor the implementation of the terms of the Covenant to ensure that the lapses are fully rectified and in the overall interest of the banking system."

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