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Nigeria: Retrenchment Fever Grips Banks, Oil Companies
Since the CBN‘s intervention, several banks across board have embarked on extensive restructuring programmes aimed at instituting improved corporate governance, cost-cutting measures, and streamlining of internal functions for enhanced efficiency.
The restructuring being undertaken by the banks, particularly the ones bailed out by the CBN, is focused on cutting costs in order to improve liquidity and is the key factor responsible for the planned retrenchment in the banking sector.
In the same vein, the suspension of credit facilities to firms in the oil and gas sector by banks and the pressure mounted on them to pay their debts has forced many to scale down operations, resulting in planned job cuts in the sector.
Investigations revealed that though the five banks recently bailed out by the CBN - Oceanic International Bank Plc, Finbank Plc, Intercontinental Bank Plc, Union Bank of Nigeria Plc and Afribank Plc - will be worst hit by the expected retrenchment exercise, some of the five banks cleared by the CBN and several others whose audits are being rounded up are equally planning to lay off thousands of staff.