Ten bank directors have shared N6.96bn executive compensation, fees and sitting allowances. The amount represents an increase of 3.32 per cent from the N6.74bn the directors received in 2020.
United Bank for Africa Plc, Zenith Bank Plc, FBN Holdings and Guaranty Trust Holding Company Plc. Union Bank for Nigeria Plc, Stanbic IBTC Holdings Plc, FCMB Group Plc, Wema Bank Plc, Fidelity Bank Plc and Unity Bank Plc consist of the banks who shared the compensation allowance.
Extracts from audited financial results and accounts for the full year ended December 31, 2021, revealed that Zenith Bank, followed by Stanbic IBTC Holdings, reported the highest sitting allowances and compensation, while Unity Bank reported the least.
Zenith Bank in 2021 reported a total of N1.65bn executive compensation, fees and sitting allowances, an increase of 18.06 per cent from the N1.4bn reported in 2020.
The breakdown shows that Zenith Bank in 2021 paid its directors N1.09bn compensation from N992m in 2020, while its fees and sitting allowances rose significantly by 38.9 per cent to N568m in 2021 from N409m in 2020.
For Stanbic IBTC Holdings, the total sitting allowance and compensation to its directors rose by 19.9 per cent to N1.672m in 2021 from N1.394m reported in 2020.
Stanbic IBTC Holdings in its report said, “The group will continue to ensure its remuneration policies and practices remain competitive, drive performance and are aligned across the Group and with its values.”
FBN Holdings’ executive sitting allowances and compensation rose by 15.7 per cent to N162m in 2021 from N140m in 2020.
However, two notable Tier-1 banks reported a decline in executive compensations, fees and sitting allowances.
Specifically, GTCO and UBA reported 17.8 per cent and 6.3 per cent drops, respectively, in their executive compensation and sitting allowances.
For instance, as GTCO’s executive compensation dropped to N757.35m in 2021 from N921.36m in 2020, UBA’s executive compensation, fees and sitting allowances dropped from N762m in 2020 to N714m in 2021.
An analysis of other banks’ executive compensation, fees and sitting allowances shows that FCMB Group reported N828.12m in 2021, an increase of 22.9 per cent from N674.09m in 2020, while Union Bank of Nigeria Plc reported a 9.6 per cent drop in its directors’ sitting allowance and executive compensation to N525m in 2021 from N581m 2020.
As Wema Bank reported N297.84m executive compensation/fees for the second consecutive year, Unity Bank grew its sitting allowances by 3.9 per cent to N38.6m in 2021 from N37.15 in 2020.
In addition, Fidelity Bank reported N312m executive compensation, fees and sitting allowances in 2021, a decline of 41 per cent from N529m reported in 2020.
Reacting, the Chairman, of Progressive Shareholders Association of Nigeria, Boniface Okezie, said although it was important for banks to remunerate their directors properly, there was also the need to ensure this was not done recklessly.
According to him, there is a need for the Central Bank of Nigeria to beam its searchlight on banks’ total payment to directors, warning that it will be wrong for the directors to feed fat at the expense of depositors and other stakeholders.
Okezie said, “These are the issues the CBN needs to look at. The directors deserve to be well-remunerated but the CBN needs to put a peg on this. There is no point in directors feeding fat while the interests of other stakeholders are not well protected.”