AMCON Burden Hits Bank Salaries

A new report has revealed that Nigerian commercial banks are paying their staff significantly less than their counterparts in other African countries—despite managing comparable asset sizes—largely due to the financial burden of regulatory levies such as those imposed by the Asset Management Corporation of Nigeria (AMCON).

- BY NIYI JACOBS

The report, published by Emerging & Frontiers Capital (EFC), a London-based equity research firm, highlights that salary levels in Nigerian Tier 1 banks have plummeted over the last decade, even as banks continue to expand their staff strength and maintain asset portfolios close to historical levels.

It states that while Nigerian banks used to lead the continent in per-employee compensation as recently as 2014, they now trail significantly behind East African peers in countries like Kenya, Tanzania, and Rwanda. Analysts blame this reversal on a combination of monetary policy constraints, high Cash Reserve Requirements (CRR), and a ballooning AMCON levy—now said to consume up to a third of bank wage bills.

"The AMCON levy is squeezing banks' operating margins. What used to go into payrolls and talent development is now diverted to settle systemic obligations from over a decade ago," said one Lagos-based banking analyst who spoke to BusinessNG on condition of anonymity.

According to the report, six leading Nigerian banks—Zenith Bank, GTCO, First Bank, Access Bank, UBA, and Stanbic IBTC—have seen average staff compensation shrink dramatically in USD terms since 2014. In that year, Nigerian banks paid up to five times more than regional peers such as Equity Group and KCB Group. But as of 2024, only Access Bank remained slightly ahead of the East African average.