In a recent statement, Femi Otedola the chairman of FBN Holdings and billionaire businessman expressed his concerns through this revelation.
According to Otedola, bank executives’ lavish expenditures negatively impact the public’s faith in financial institutions and divert important resources from imperative areas like operational efficiency, customer service and technological innovation.
Therefore, he urged banks to prioritize their finances towards bolstering these aspects for an improved experience of customers benefitting through enhanced facilities/tools.
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“While there has been some advancement in banking sector reforms, it is crucial to tackle persistent problems in Nigeria’s banking industry.
A worrying pattern has developed where certain bank CEOs prioritize their self-interests rather than fulfilling obligations towards shareholders and clients.
The fundamental principles of trustworthiness, honesty, and service must be maintained within the banking system. I am especially critical about extravagant practices such as possessing and managing private jets,” expressed Otedola.
Additionally, he expressed his endorsement for the Federal Government’s initiative to levy a 70 percent windfall tax on foreign exchange gains made by banks.
The Finance Act was modified in July by the Senate to impose this tax on overseas currency profits earned by financial institutions. Its proceeds are earmarked towards financing the supplementary budget totalling N6.2 trillion intended for government expenditures.
According to Otedola, the implementation of a windfall tax is essential in promoting fairness and equality within the economy.
He emphasized that with such taxes in place, excessive profits can be taxed fairly thereby prompting those who accrue disproportionate gains to make more significant contributions towards society thus enabling an equal distribution of wealth.
He explained that the windfall taxes’ revenue may be used to fund vital public services like healthcare, education, and infrastructure.
This would benefit everyone in society by helping reduce social inequality. He regarded the recent imposition of a windfall tax on Nigerian banks as an important measure towards achieving these objectives.
Otedola emphasized that several manufacturing, telecoms and SME companies are encountering difficulties in meeting their corporate tax obligations owing to unfavorable equity. Therefore, it is crucial for the Government to intervene by providing support.
He urged banks to regain customer confidence by shifting their fiscal objectives and directing investments towards enhancing technological infrastructure as well as improving customer services directly.
