Following the rising energy cost in the country, Group Managing Director (GMD) of GTCO, Segun Agbaje saiid his bank has reduced closing time from about 6pm to 4pm daily in a bid to save cost.
Agbaje who made this known during an interactive session with Business Editors in Lagos said rising energy cost, particularly diesel has affected all the sectors of the economy, and the bank has no option than to reduce its closing time to save cost.
This development, he said, is partly responsible for the rise in cost to income ratio of the bank, which has risen from 38.2 per cent in 2020 to 42.3 per cent in 2021.
The implication is that, while the bank spent 38.2 kobo for every N1 or 100 kobo made in 2020, it spent 42.3 kobo for every N1 or 100 kobo made in 2021.
He believes that other banks are likely going to follow the same path soon, as the rising energy cost bites harder.
As though the problem of rising energy cost is not enough, the increase in Cash Reserve Ratio (CRR) to 60 per cent has further made life more difficult for banks. He compared the CRR of Nigeria with a peer country Ghana which is 12 per cent.
The implication of the high CRR for Nigerian banks is that, money which would have raked in more interest profits is being sterilise with the Central Bank of Nigeria (CBN).
“I am not saying that the CBN do not have the right to use the CRR as a monetary tool, but the ratio at 60 per cent is rather too high” , he said.
