BUSINESS

Nigerian banks wastful, four of them bought private jets for $500 million – Otedola

Billionaire investor, Femi Otedola, has criticised the extravagant spendings of commercial banks while showing support for the federal government’s resolve to levy windfall tax on them. Windfall gains are extraordinary profits a bank or a commercial entity makes in strange circumstances outside of their own doings.

“A concerning trend has emerged where some bank chief executives prioritize personal gain over their duty to shareholders and customers. The core values of banking—trust, integrity, and service—must be upheld. I am particularly critical of the culture of flamboyance, especially the ownership and operation of private jets.

“Nigerian banks are spending an estimated $50 million annually just on maintaining private jets, with over $500 million gone into purchasing nine private jets by four banks. This level of extravagance significantly erodes public trust in our financial institutions and diverts crucial resources away from vital areas such as operational efficiency, technological innovation, and customer service,” the billionaire, who is currently the chairman of First Bank of Nigeria Holdings, said.

Otedola equally advocated necessary banking reforms that would make the commercial lenders focus on their core objectives.

“These reforms will empower our banking sector to play a pivotal role in driving Nigeria’s economic development, ultimately securing a prosperous future for all Nigerians,” the investor said.

“It is crucial for banks to focus on operational efficiency, technological innovation, and customer service, rather than executive extravagance,” he said.

Otedola said government needs revenue from the windfall tax for wealth redistribution in the society.

“The recent announcement of a windfall tax on the extraordinary profits earned by Nigerian banks is a significant first step towards achieving these goals. The consolidation of various foreign exchange rate systems into a single investors and exporters (I&E) window led to the depreciation of the Naira and substantial increases in the value of bank assets denominated in United State dollars”

 

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