Sterling Bank has announced a 7% salary increase for its more than 3,000 staff members, in a bid to help its employees cope with the rising cost of living. The news was shared in an internal memo earlier this month, marking a significant step as the bank responds to ongoing economic pressures affecting many Nigerians.
This salary adjustment is part of a broader trend among banks in Nigeria, which have been reevaluating employee compensation in light of inflation and increased living expenses. Last August, Sterling Bank had already introduced a cost-of-living adjustment (COLA) stipend of ₦75,000 for employees ranging from executive trainees to assistant banking officers. However, it remains unclear if this stipend will continue alongside the new salary structure.
While the specifics of the salary increases are not publicly available, insiders indicate that adjustments vary based on employee grade levels. Sterling Bank employs a tiered salary structure that allows for raises within existing grades without necessitating formal promotions. For example, executive trainees will see their monthly pay rise from ₦327,000 to ₦351,000, while senior executives will go from ₦500,000 to ₦527,000.
Chibuzo Ihentuge-Eric, an HR professional, explained that during economic downturns, companies often adjust salaries sideways within grade levels rather than promoting employees to higher ranks. This approach helps manage costs while still providing some relief to staff.
Despite the raise, some employees expressed disappointment. Many were hoping for increases more in line with those seen at other banks, like Union Bank and GTBank, which raised salaries by 40% late last year. One anonymous employee shared, “Considering inflation and the state of the economy, this feels underwhelming.”
Sterling Bank’s profit after tax for the period ending September 2024 was ₦27.4 billion, reflecting a robust 67% year-on-year increase. The bank is projecting ₦121.8 billion in gross earnings for the first quarter of 2025. However, its personnel expenses reached ₦22.6 billion, accounting for about 21.67% of total expenses.
If the new salary adjustments increase personnel costs by the usual 10%, this could raise the wage bill to approximately ₦24.86 billion, still one of the lowest among its peers. For context, Union Bank reported personnel expenses of ₦34 billion, while Fidelity Bank and FCMB reported even higher figures
While Sterling Bank’s 7% salary increase reflects an effort to support employees amid rising living costs, many staff members feel the adjustment falls short of their expectations. As competition for talent intensifies within the banking sector, the bank faces the challenge of balancing financial sustainability with employee satisfaction. This situation underscores the need for ongoing dialogue between management and staff to ensure that compensation remains competitive and responsive to economic realities.
