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IMPACT OF REWARD SYSTEM ON THE PERFORMANCE OF SELECTED MONEY DEPOSIT BANKS IN ANAMBRA STATE NIGERIA

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ABSTRACT

This study focuses on Impact of Reward System on Performance of Selected  Money Deposit Banks in Anambra State, Nigeria. The study sought to determine the effects of contingency pay on productivity in selected Money Deposit Banks in Anambra State, ascertain the extent to which employee recognition enhances employee performance in selected  Money  Deposit  Banks  in  Anambra   State,   determine  the  extent  of  the relationship between variable pay and customer satisfaction in selected Money Deposit Banks  in  Anambra  State,  identify  the  effects  of  career  opportunity  on  manpower development  in selected  Money  Deposit  Banks  in Anambra  State. The study had a population size of 1858, out of which a sample size of 369 was realised using Zigmund formula at 5% error tolerance and 95% level of confidence. Instruments used for data collection  were  primarily  questionnaires  and  interview.  Out  of  369  copies  of  the questionnaires  that  were  distributed,  350  copies  were  returned  while  19  were  not returned.  The  descriptive  survey  research  design  was  adopted  for  the  study.  The hypotheses  were tested using Pearson  Product Moment  Correlation  Coefficient  and Simple Linear Regression statistical tools. The findings indicated that contingency pay had significant effect on productivity (r = 0.652; t= 13.209; F= 174.480; p = 0.00 < 0.05). Employee recognition  had significantly enhanced  employee performance  (r  = 0.534;  t  =  12.589;  F=  158.495;  p=  0.000  <  0.05).      There  was  a  significant relationship between variable pay and customer satisfaction (r = 0.955; p= 0.000 < 0.05).  Career  opportunity  significantly  affected  manpower  development  in  Money Deposit Banks (r = 0.717;t = 20.524; F = 421.248; p = 0.000   < 0.05).  The study concluded that reward system is a vital tool for employees’ effectiveness and efficiency on their job. The study recommended that organizations should adopt contingency pay strategy, which will help to retain and attract talented  employees that will assist in promoting organizational productivity.

CHAPTER ONE INTRODUCTION

1.1      Background of the Study

Reward  system  is an important  tool that management  can use to channel  employee motivation in desired ways. In other words, reward systems seek to  attract people to join the organization to keep them coming to work, and motivate them to perform to high levels. The reward system consists of all organizations components – including people, processes,  rules and decision making activities  involved  in the allocation of compensation  and  benefits  to  employees  in  exchange  for  their  contribution  to  the organization (Puwanenthiren, 2011).Reward systems are ways of promoting individual and organizational  behaviour  needed  to  achieve  the organizational  strategy and the organization’s goals (Lawler, 1995; Kerr and Slocum, 2005).

In order for an organization  to meet its obligations  to shareholders,  employees  and society, its top management must develop a relationship between the organization and employees  that  will  fulfill  the  continually  changing  needs  of  both  parties.  At  a minimum the organization expects employees to perform reliably the tasks assigned to them  and  at  the  standards  set  for  them,  and  to  follow  the  rules  that  have  been established to govern the workplace. Management often expects more: that employees take initiative, supervise themselves, continue to learn new skills, and be responsive to business needs. At a minimum, employees expect their organization to provide fair pay, safe working conditions, and fair treatment. Like management, employees often expect more,  depending  on  the  strength  of  their  needs  for  security,  status,  involvement, challenge, power, and responsibility. Just how ambitious the expectations of each party are,  vary  from  organization  to  organization.   For  organizations  to   address  these expectations  an  understanding  of  employee  motivation  is  required  (Beer,  Spector, Lawrence, Mills, and Walton, 1984).

A  well  designed  and  functional  reward  system  is  an  efficient  way  to   increase employeework motivation. The appropriate type of reward is developed in accordance to  thecompany’s  reward  philosophy,  strategies  and  policy.  However,  it  might  be challengingto  find  the right way to combine  the  company’s  integrated  policies  and practices together with the employee’s contribution, skill and competence. (Armstrong,

1999).

Kerr and Slocum (2005) define the reward system as to who gets rewarded and why. They also suggest reward systems to be powerful means of influencing organisational culture, and that reward system is a primary method of achieving control. Also, with regards  to  reward  systems  they  state:  the  reward  system  defines  the  relationship between  the  organization  and  the  individual  member  by  specifying  the  terms  of exchange: It specifies the contributions expected  from members and expresses values and norms to which those in the organization must conform, as well as the response individuals can expect to receive as a result of their performance. (Kerr and Slocum,

2005). The reward system is a group of neural structures that are critically involved in mediating the effects of reinforcement. A reward is an appetitive stimulus given to a human  or  some  other  animal  to  alter  its  behavior.  Rewards  typically  serve  as reinforcers.  Messmer,  (2008) assert that a reward  system  is a  structured  method of evaluating and compensating employees based on their  performance. Reward system Procedures,   rules,   and   standards   associated    with   allocation   of   benefits   and compensation to employees (Kerr and slocum, 2005).

The current financial crisis the world is experiencing has made the reward system, with focus on bonuses and viable remuneration, a highly debated topic in media.  Reward systems are often used as a management tool for achieving desirable objectives. One of the most common purposes is to motivate employees to perform better (Ax, Christer and Kullven, 2006). When workers are motivated,  they are more likely to perform better.   Improved   worker   performance   quickens   the   achievement   of   corporate objectives.

Organizations are established to accomplish specific objectives. The organization that wishes   to   achieve   these   objectives   must   have   a   competitive   and   perhaps   a comprehensive  total reward  system  that is aligned  with the  organization’s  business strategy and that reflects the competitive reality of the labour market. In a world where people have become more and more demanding about their lives and surroundings, the reward  system  could  be used  to  motivate  employees  by satisfying  these  demands. However,  there  exists  a  lack  of  understanding  in  how  to  motivate  all those  high demanding individuals, making most of the reward systems sub-optimized. To create an optimal reward  system,  we need to better understand  what really motivates,  and what does not.

Individuals  working  for  organisations  are  all  different;  their  needs,  thoughts  and experiences are different and they are all motivated by different things. Thus, it would be  more  correct  if the  rewards  also  were  individualized.  It is important  for  every employer to find what motivates each employee. In a perfect world, the company has resources  to ensure that all employees  have a meaningful  job, but  this is far from reality. People want to feel that what they do make sense.  What  motivates  us will change  over  time.  What  was  seen  as  meaningful  25  years  ago  may  not  feel  as meaningful today. We are motivated by different things depending on where we are in our development. A young worker is likely to be keener on development possibilities, while an older one is more anxious about security and to be able to use his experience (Jagult, 2005).

Banks have been keen on growth and expansion and this has led to continuous war for talent to operate in subsidiaries in the regional market and to steer innovation.  In top demand are people who are technologically literate, globally astute and capable of not only developing but also executing strategy, setting off a scramble for staff among the top  firms.  However,  in as much  as banks  worked  to  get  people  with  the  greatest potentials to occupy positions, employee maintenance has become a challenge for many of them due to the high labour costs involved, constituting up to 60 per cent of the total costs (Cherotich, 2012).

In attempts to remain competitive and profitable, banks have resorted to cost reduction, the first casualty being the human capital investment  like cutting back  benefits and recruitment,   freezing   or   cutting   salary   increases,   promotion   and   development programmes  like training.  Unfortunately,  focus is on payrolls  to reduce the cost to income ratio with most banks aiming below 50 per cent level. Employees interpret the labour cost cutting measures as a breach of trust, making it more difficult for firms to retain key talent (Perry, Mesch, and Paarlberg, 2006). The outcomes of such an event are  reduced  staff  motivation  and  satisfaction  leading  to  low  output  levels,  loss  of morale,  lowered  organizational  commitment,  work  withdrawal  behaviours  such  as absenteeism and lateness, increased turnover, mistrust, uncertainty and insecurity.

This presupposes that, for organisations to achieve their goals, employees’ performance should be, at least optimum.  Workers have to be motivated to perform above average or encouraged to maintain high performance level.  Hence, in today’s business culture, rewards, recognition and an enjoyable workplace have become extremely important for

many reasons. Motivation is the key that gets people to do what they do. Armed with the  knowledge  of  what  is  most  important,  creative  solutions  and  the  appropriate financial resources can be devoted to addressing the key issue. Without this knowledge, too much well-meaning effort might be expended trying to fix things that are not all that important to employees (Kreitner and Kinicki, 1998). It is in the light of this that issues concerning the employees are considered the driving force of every organization and must be given the needed  attention,  as it  will affect their performance  and the organization  at  large.  One  of  the  key  issues  that  concern  every  worker  in  an organization has to do with the reward or compensation for their effort.

1.2      Statement of the Problem

The types of reward in most organizations usually are not performance based.  Thus they  are  not  linked  in  any  way  to  business  structure  and  employee  recruitment, retention, motivation, performance, feedback and satisfaction. Moreover, the recipients of  these  rewards  in  most  organizations  do  not  participate in the  planning  and  the implementation of the reward systems in organizations. Further, there are a number of loopholes  in  the  administration  of  the  various  ways  of  rewarding  employees  in organizations.  Again, most  organizations  view reward  system  as only the monetary compensation given to employees to compensate them for their performance, whereas rewards should be everything that goes into motivating the individual employee to give out his best.  The study will evaluate  the reward  systems of the banking system  in Nigeria  and  establish  whether  their  current  reward  systems  have  any  bearing  on corporate performance.

It is an undisputable fact that rewards can enhance workers’ performance and  hence improve corporate performance.  The extent to which a worker does his or  her work effectively and efficiently depends on the level of motivation received. It is known that individuals differ in likes and interest, as what motivate one may not motivate the other. Thus, the study wants to determine the components of reward system in the banking system of Nigeria and the extent to which the existing reward system has improved corporate performance.

Finally, among the empirical studies that dealt with reward system in organizations and its  relationship  with  factors  such  as  employee  motivation,  employee  performance, employee satisfaction and effect on quality of work done, showed  reward to have a positive  effect.  However,  different  rewards  seem  to  have  a  different  impact  on

employee  attitude,  satisfaction and performance.  However,  there are mixed  findings when it comes to individual rewards and their effect on performance.

1.3      Objectives of the Study

The main objective  of this study is to  determine  the  impact  of reward  system  on performance  in  selected  Money  Deposit  Banks  in  Anambra  State.  The  specific objectives were to:

1.        Determine  the effect  of contingency  pay on productivity  in selected  Money

Deposit Banks in Anambra State.

2.        Ascertain   the   extent   to   which   employee   recognition   enhance   employee performance in selected Money Deposit Banks in Anambra State.

3.        Determine  the  extent  of  the  relationship  between  variable  payand  customer satisfaction in selected Money Deposit Banks in Anambra State.

4.        Identify the effects of career opportunity on manpower development in selected

Money Deposit Banks in Anambra State.

1.4      Research Questions

The following questions guided the study:

1.        What  are  the  effects  of  contingencypay  on productivity  in  selected  Money

Deposit Banks in Anambra State?

2.        To What extent does employee recognition enhance employee performance in selected Money Deposit Banks in Anambra State?

3.        What  is  the  extent  of  the  relationship  between  variable  pay and  customer satisfaction in selected Money Deposit Banks in Anambra State?

4.        What  are  the  effects  of  career  opportunity  on  manpower  development  in selected Money Deposit Banks in Anambra Stat?

1.5      Research Hypotheses

The following Hypotheses were tested in order to achieve the stated objectives of this study:

H1(i):    Contingency  pay  has  significanteffect   on  productivity  in  selected   Money

Deposit Banks in Anambra State.

H1(ii):    Employee recognition significantly enhancesemployee performance in selected

Money Deposit Banks in Anambra State.

H1(iii):  There is a significant positive relationship between variablepay and customer satisfaction in selected Money Deposit Banks in Anambra State.

H1(iv):  Career opportunity affects manpower development in selected Money Deposit

Banks in Anambra State.

1.6      Significance of the Study

The study will benefit the bank employees and the bank management,  the  academic community and the general public.

The bank management  and the banking system  generally will be provided  with  an insight into the major components of rewards that motivates their staff. A well designed system  for rewarding  labour greatly has a bearing on the output of  employees  and therefore impact on the performance of the organization as a whole. Banks that seek to optimise their corporate objectives can anchor on total reward system.

Reward   represents   by  far  the  most  important   and  contentious   element   in   the employment relationship, and is of equal interest to the employer and employee.  Thus, the  findings  of this  work could  enhance  work  relationship  in the banking  system. Meeting the needs of employee can be a veritable tool to managing work conflict; with this study, employers will appreciate the core reward items that  solved the needs of their employees in Nigerian banking system.

When  banks  appreciate  reward  components  that  best  motivate  their  staff,   bank employees  will be better off in terms of job satisfaction.  Satisfied  employee can be more  productive  and  less  job  turnover  as  well.    To  the  employer,  these  factors represents   a  significant   part  of  business   costs;  it  is   increasingly   important   to employersas  it   affects its ability to recruit and retain  a quality labour force; to the employee it is fundamental to his standard of living and is a measure of the value of his services or performance.

The academic community will appreciate new findings and contribution to knowledge resulting  from  this study.  The students of management  will gain  knowledge  of the issues to influence individual as well as corporate performance in the banking system and other  corporate  world  generally.  The study will be  case in point that different industry workers can be motivated differently.

Generally, anybody who studies this work will understand the current issues on reward system and its effect on workers’ performance. The study will bring to the fore the fact

that “when you reward, you motivate; and when you reward effectively you motivate better to achieve your objectives”. Thus, the general public will be aware that the nature of reward has effect on the level of motivation obtainable from the worker. In other words, the general public may know that what motivates one  may not motivate the other.

1.7      Scope of the Study

The study focused on the banking system as one of the financial institutions in Nigeria. It is predicated on the assumption that good reward systems have bearings on corporate performance. It assessed the current systems and their limitations as well as advantages and  the  level  of  employee  involvement  in the  design  and  implementation  of  such reward  systems.  The  study  involved  all  cadres  of  employees  including,  branch managers,  sales,  mortgages,  loan  and  marketing  officers,  tellers,  accounts  clerks, auditors,  computer  specialists,  receptionists,  sales representatives,  and  marketers  of banks  and  their  products.  This  study  was  limited  to  the  effects  of  reward  on performance  among  banking  employees.  The  banks are First  Bank,  FCMB,  Zenith Bank, Keystone Bank and Union Bank Plc: the study was carried out at Anambra State and the time range for the study was from 2004 to 2014

1.8      Operational Definition of Terms

Recognition: Recognition refers to the respect an employee enjoys among colleagues in the organization, which is as a result of the status or value of his job.

Motivation: Is defined as the force or process, which causes individuals to act  in  a specific way.

Compensation:Compensation   is  what  employee  receives   in  exchange   for   their contribution to the organization.

Incentive:  Incentives are payments made to an employee or group of employees based on  the  amount  output  or  results  achieved  or  payments  made  for  the  purpose  of motivating employees’ performance.

Rewards:  Rewards are incentives that are promised and given to a worker for doing a job in an organisation.

Monetary Rewards:  Monetary rewards are financial rewards or direct cash payments which consist of performance pay, competency pay, gain sharing and profit sharing to workers for their performance or contribution in an organization.

Non-monetary Rewards:  Non-monetary rewards are non-cash rewards which consist of all intrinsic motivators such as achievement, responsibility, opportunity for growth and extrinsic motivators such as recognition, job enrichment and praise.

Premium  Pay: Premium pay is additional  pay provided  to employees  for  working certain types of hours or under certain types of conditions.   Example is working on weekends, holidays, vacation days or working during hours deemed less desirable. Benefits:   Benefits   are   programs   an   employer   uses   to   supplement   the   cash compensation that employees receive. These are health, income protection, savings and retirement programs, provision of security for employees and their families.

Work-life:  A specific  set of organizational  practices,  policies and programs  plus  a philosophy that actively supports efforts to help employees  achieve  success at both work and home.

Performance:  Performance  is  the  alignment  of  organization,  team  and  individual efforts  towards  the  achievement  of  business  goals  and  orgainsational  success.  It includes  establishing  expectations,  skill  demonstration,   assessment,  feedback  and continuous improvement.

Development:A  set of learning experiences designed to enhance employees’  applied

skills and competencies.

Career Opportunities:  Involves the plan for employees to advance their career goals. It may include advancement into a more responsible position in an organization.

Staff Engagement: Higher level of staff commitment, that is aligning self in totality to goals, mission/vision of the organization.

1.9      Background Information on the Nigerian Banking Environment

The history of the Nigeria banking system is replete with growth and burst cycles in the number of operating banks and their branches. Usually growth spurts are experienced when the policy environment  present strange  business  opportunities  in the banking sector or there is a sudden policy shift that makes it easy for ordinary business people to initiate a process that creates access to public funds in the name of bank deposits. The Central bank of Nigerian’s resolve to carry out reforms in the banking sector was borne out of the past of the nation’s banking industry. Between 1994 and 2003 a space of nine years, no fewer than 36 banks in the country closed shop due to insolvency. In 1995 four banks were closed down. But 1998 may go  down well in history as the saddest year for the banking industry as 26 banks closed shop that year.

Three terminally ill banks also closed shop in 2000. In 2002 and 2003 at least one bank collapsed.  The failed  banks  had  two  things  in common  – small size and  unethical practices. Of the 89 banks that were in existence as at July 2004, when  the banking sector reforms were announced, no fewer than 11 of them were in a state of distress. According to the CBN, between 69 and 79 of the banks were marginal or fringe players (Soludo, 2004). The decade 1995 and 2005 were particularly traumatic for the Nigerian banking  industry;  with  the  magnitude  of  distress  reaching  an unprecedented  level, thereby making it an issue of concern not only to the regulatory institutions but also to the policy analysts and the general public. Thus the need for a drastic overhaul of the industry was quite apparent. In furtherance of this general overhauling of the financial system, the Central Bank of Nigeria introduced major reform programmes that changed the banking landscape of the country in 2004. The main thrust of the 13-point reform agenda was the prescription of minimum shareholders’ funds of 25 billion. In view of the low financial base of these banks, they were encouraged to merge. Out of the 89 banks  that were in operation before the reform, more than 80 percent (75) of  them merged into 25 banks while 14 that could not finalize their consolidation  before the expiration of deadline were liquidated  (Elumilade,2010;  Afolabi,  2004).  In terms of Asset, the total asset of all the 89 banks operating  in  Nigeria  in 2004 prior to the consolidation was N3,753.28 billion (US$28.250 billion) and rose to N6400.78 billion (US$49.88 billon) indicating a growth rate of 70.54.16 per cent within one year after consolidation.   The  asset  size  of  an   average   bank  which  was  N42.172  billion (US$0.3174 billion) grew geometrically toN267.482 billion (US$2.0856 billion) within a year after the  consolidation exercise, a growth rate of 534.27percent.  This was an impressive  performance.  However, an assessment of the level of capitalisation of an average  bank prior to consolidation exercise indicates an equity base (Net worth) of N7.71  billion  (US$0.06168  billion)  rising  to  N38.83  billion  (US$0.31064  billion) in2006, indicating a growth rate of 404 percent. The leverage ratio measured in terms of equity to total asset also declined from 18.28 per cent in 2004 to 14.52 per cent in

2006 for an average bank. This ratio compares favourably with the CBN  minimum

level of 10 per cent. The post consolidation ratio is also better in term of its distribution among the banks compared with the pre-consolidation ratio where  more than 70 per cent of the equity and assets were concentrated in (the largest five banks) less than 5 percent of the existing banks. However, the intermediation activities of an average bank improved significantly by about 1,690 per cent from an average deposit base of N10.48 billion  (US$0.08384)  in 2004  to  N188.48  billion  (US$1.50784)  in 2006  (Somoye,

2008).  Analysis  of the role  of commercial  banking  sector  relative  to  the  economy enables appreciation of whether the banking industry will assume any appreciable level of importance in the aggregate economy as a result of consolidation.

The assets of commercial banks which stood at 32.89 per cent of the GDP in2004 rose marginally to 35.43 per cent in 2006. The degree of private sector credit  has been suggested to be a better indicator of bank contribution to private investment. In 2004, commercial banks channeled  24.08 percent of their lending  to the non-bank private sector, but this declined to 22.47 per cent by 2006. Likewise, the value of commercial bank credit relative to the GDP which was 2.73 per cent in 2004 rose marginally to 2.91 percent in 2006. There has not been any appreciable growth in terms of the growth in credit to the private sector because the commercial bank credit which has a growth rate of 26.6 percent between 2003 and 2004 grew marginally to30.8 percent in 2006 and declined to 27.82 percent a year after the consolidation.

The relative performance of the banking size in terms of asset size, private sector credit, relative to the economy have been very marginal such that it can be safely concluded that the consolidation exercise has not brought about any meaningful contribution with respect to some of these performance indicators. Since its creation in 1892, Nigerian banking sector has experienced very turbulent environment due to unstable policies and uncertainty. I n 2009 Central Bank of Nigeria carried out an audit of the banking sector in which nine banks failed. The failure of these banks necessitated the intervention of Central bank of Nigeria inform of bailed out because the banks that failed the audit had negative shareholders fund as a result of high percentage of non-performing loans. The failure  of  some  commercial  banks  to  meet  up  with  financial  performance  after consolidation  requires  a  rethink  to  evaluate  their  performance  using  non-financial measures, thus this study is designed to evaluate the performance of consolidated banks using non-financial measures. The objective of the study is to evaluate the performance of consolidated banks using non-financial measures.

1.10     Profile of Selected Banks

First Bank of Nigeria Plc

First Bank of Nigeria PLC is a Nigeria-based  bank that offers a range of  financial services. First Bank of Nigeria is a Nigerian bank and financial services firm. It is the country’s  third  biggest  bank.  First  Bank traces  its ancestry  back  to  the  first major

financial institution founded in Nigeria; hence the name. The current chairman is Prince AjibolaAfonja.  The bank is the largest retail lender in the nation, while  most banks gather funds from customers and loan it out to large corporations and multinationals, First Bank has created  a small market  for some of its retail  clients.  At the end of September 2011, the bank had assets totaling approximately US$18.6 billion (NGN: 2.9 trillion). The bank’s profit after tax, for the nine months ending 30 September 2011 was approximately US$270.2 million (NGN: 42.2 billion).  First Bank of Nigeria maintains a subsidiary in the United Kingdom, FBN Bank (UK), which has a branch in Paris. The bank also has representative offices  in South Africa and China. In October 2011, the bank acquired Banque International de Credit (BIC), a leading bank in the Democratic Republic of Congo (DRC).

The company was named  the best bank in Nigeria by Global Finance  Magazine  in September   2006.   The   firm’s   auditors   are   PricewaterhouseCoopers   (Chartered Accountants). The firm has solid short and long term ratings from Fitch and the Global Credit Rating Company partly due to its low exposure to  non-performing loans. The firm’s  compliance  with  financial  laws  has  also   strengthened  with  the  Economic Financial Crimes Commission giving it a strong rating.

In  June  2009,  Stephen  OlabisiOnasanya  was  appointed  Group  Managing  Director (CEO),  replacing  Sanusi  Lamido  Sanusi,  who  had been appointed  governor  of the Central Bank of Nigeria (www./First_Bank_of_Nigeria).

First City Monument Bank Plc

First City Monument Bank (FCMB) Ltd is a full service banking group, headquartered in Lagos, Nigeria, with the vision ‘to be the premier financial services group of African origin’. FCMB is a large financial services provider in Nigeria, offering retail banking, corporate banking and investment  banking services to  large corporations,  small and medium  enterprises,  as well as individuals.  As of  December  2011, the bank’s  total assets were valued at US$$3.65 billion (NGN: 593.3 billion), with shareholders’ equity of approximately US$772.2 million (NGN: 117.4 billion).

The entity from which the bank was founded City Securities Limited, was established in 1977. First City Monument Bank Ltd. was incorporated as a private limited liability company on 20 April 1982 and granted a banking licence on 11 August 1983. It was the first bank to be established in Nigeria without government or foreign support. On

15 July 2004, FCMB changed its status from a private limited liability company to  a public limited liability company and was listed on the Nigerian Stock Exchange (NSE)

by introduction on 21 December 2004. In November 2010, both FinBank and First City Monument Bank (FCMB) announced that FCMB has expressed interest in  acquiring shareholding   and   become   the  strategic   investor   in  FinBank,   another  Nigerian commercial bank that was undercapitalized.  In February 2012,  following  regulatory approval, FCMB acquired 100% shareholding and began integration of FinBank in its existing operations.

Subsidiaries

First  City  Monument  Bank  has  a  number  of  active  non-bank  subsidiaries,  which together with the bank, form the First City Group. Members of the group include the following companies:

1.        FCMB Capital Markets Limited – Investment banking & Advisory services – Lagos, Nigeria

2.        FCMB  (United  Kingdom)  Limited  –  Investment  banking  –  London,  United

Kingdom

3.        CSL Stockbrokers Limited – Stock brokerage services – Lagos, Nigeria

4.        Legacy Pension Fund Administrators – Pension Fund Administrators –  Abuja, Nigeria

5.        Credit Direct Limited – Microfinance lending – Lagos, Nigeria

(http://org/wiki/First_City_Monument_Bank).

Keystone Bank Plc

On 5 August 2011, Keystone Bank Limited (Keystone Bank or the bank) assumed the deposit liabilities, certain other liabilities and assets of Bank PHB Plc  following the revocation of Bank PHB’s operating License by the Central Bank of Nigeria (CBN). Keystone  Bank  is  a  technology  and  service-driven  bank  with  subsidiaries  in  the Gambia, Sierra Leone, Liberia and Uganda, and a vibrant and professional workforce, the bank operates with best practices and offers  leading solutions and services to its clients and associates. A leading financial services institution located in Nigeria, Bank PHB is strongly positioned  as  Africa’s fast emerging centre of innovative  financial solutions to a growing and diverse global customer base. The bank strategic intent is to build  a  diversified  franchise,  creating  superior  value  for  all  stakeholders  through unrivalled customer service experience, superior shareholder value, a conducive work environment, and commitment to corporate citizenship. Bank PHB has emerged as one of Africa’s fastest. Keystone Bank drives its current and future successes from a very solid vision and mission statements:

Vision:

To set the pace in financial services delivery, creating utmost value for our stakeholders

Mission:

To deliver consistent superior performance and be the preferred partner

Core Values – S. P. I. R. I. T.

Service Passion Innovation Resilience Integrity Team Work

Union Bank of Nigeria Plc

Union Bank of Nigeria’s rich history can be traced to 1917 when it was first established as Colonial Bank. In 1925 the bank became known as Barclays Bank DCO (Dominion, Colonial  and Overseas)  resulting  from its acquisition  by  Barclays  Bank.  Following Nigeria’s independence and the enactment of the Companies Act of 1968, the bank was incorporated as Barclays Bank of Nigeria Limited (BBNL, est. 1969). Between 1971 and 1979, the bank went through a series of changes including its listing on the NSE and  share  acquisitions/transfers  driven  by the Nigerian  Enterprises  Promotion  Acts (1972 and 1977); this resulted in its evolution into a new wholly Nigerian-owned entity. To reflect the new  ownership  structure,  and in compliance  with the Companies  and Allied Matters Act of 1990, it assumed the name Union Bank of Nigeria Plc. (UBN “the Bank” or “Union Bank”).

In 1993, in line with its privatization/commercialization drive, the Federal Government divested by selling its controlling shares (51.67%) to private  investors. Thus, Union Bank became fully owned by Nigerian citizens and organizations all within the private sector.  During  the  Central  Bank  of  Nigeria’s  banking  sector  consolidation  policy, Union Bank of Nigeria Plc acquired the former Universal Trust Bank Plc and Broad Bank Ltd. and absorbed its one-time subsidiary, Union Merchant Bank Ltd. On the 14th of August, 2009, the Central Bank of Nigeria (CBN) intervened in the management of the  Bank  by replacing  the  Executive  Management  Team  with  a  five-man  Interim Management Team to  stabilize and recapitalize the Bank. Full recapitalization of the Bank was  achieved  in December 2011 with the injection of $500million into Union Bank  by  Union  Global  Partners  Limited  (UGPL)  after  the  Asset  Management Company of Nigeria (AMCON) had provided capital in the sum of N46.93bn to bring the Bank’s Net Assets Value to zero.

Currently, the Bank is primarily owned by UGPL (65%) and AMCON (20%)  and a diverse group of shareholders that account for the balance (15%). UGPL, a consortium of  strategically  aligned  group  of  investors,  is the  Bank’s  core  investor  group  and consists of:

            African Capital Alliance

            ADC African Development Corporation

            Corsair Capital

            FMO (the Netherlands Development Finance Company)

            Chandler Corporation

            Standard Chartered Private Equity

Union  Bank  of  Nigeria  Plc.  has  an  asset  base  of  over  N826.7  Billion  Naira  and shareholders’  funds in excess of N183.1  Billion Naira. The bank’s  impressive track record over the years has secured its position as Nigeria’s most dependable bank. Union Bank   is   primarily   focused   on   commercial   and   retail   banking   in   the   Real

/Agriculture/Public Financing sectors.  Among the bank’s markets are retail, small and

medium sized enterprises, real estate, corporate/commercial,  correspondent,  and trade finance.  The bank also  offers investment  and financial  management,  trust  services, private  banking,  insurance  services,  and  pension  services.   The  bank’s  commercial clients include communications, agriculture, energy, public utilities, retailing, and other specialty industries

The Union Bank Group

Union Bank has subsidiaries and affiliate companies in Nigeria and across West Africa, providing  a  range  of  financial  services  and  products  through  the  following  major business segments: Retail & Corporate Banking, Mortgage and  Real Estate Services, Insurance,  Pension,  Stock  Brokerage  and  Asset  Management  Services.  The  Group operates an interlocking organizational structure- one that ensures effective oversight and  participation   in  the   decision-making   process   of  subsidiaries   or  associated companies,      thereby      helping to safe guard the Bank’s investment (http://www.unionbankng.com/index.php/about-us/history).

Zenith Bank Plc

Zenith Bank Plc was established in May 1990, and commenced operations in July of the same year as a commercial bank. The Bank became a public limited company on June 17, 2004 and was listed on the Nigerian Stock Exchange (NSE) on October 21,

2004  following  a  highly successful  Initial  Public  Offering  (IPO).  Zenith  Bank  Plc currently has a shareholder base of about one million and is Nigeria’s biggest bank by tier-1 capital. In 2013, the Bank listed $850 million worth of its shares at $6.80 each on the London Stock Exchange (LSE).

Headquartered in Lagos, Nigeria, Zenith Bank Plc has over 500 branches and business offices  in prime commercial  centres  in all states of the  federation  and  the Federal Capital Territory (FCT). In March 2007, Zenith Bank was licensed  by the Financial Services  Authority  (FSA)  of  the  United  Kingdom  to  establish  Zenith  Bank  (UK) Limited as the United Kingdom subsidiary of Zenith Bank Plc. Zenith Bank also has

subsidiaries  in:  Ghana,  Zenith  Bank  (Ghana)  Limited;  Sierra  Leone,  Zenith  Bank (Sierra Leone) Limited; Gambia, Zenith Bank (Gambia) Limited. The bank also has representative offices in South Africa and The People’s Republic of China. The Bank plans to take the Zenith brand to other African countries as well as the European and Asian markets.

Zenith Bank Plc blazed the trail in digital banking in Nigeria; scoring several firsts in the deployment of Information and Communication Technology (ICT) infrastructure to create innovative products that meet the needs of its teeming customers. The bank is verifiably a leader in the deployment of various channels of banking technology, and the  Zenith  brand  has  become  synonymous  with  the  deployment  of  state-of-the-art technologies in banking.

Driven by a culture of excellence and strict adherence to global best practices, the Bank has combined vision, skillful banking expertise, and cutting-edge technology to create products  and  services  that  anticipate   and  meet  customers’   expectations;   enable businesses to thrive and grow wealth for customers. Zenith Bank Plc, founded by Jim Ovia in 1990, has, since grown astronomically to become one of the leading financial institutions in Africa. Zenith Bank Plc currently ranks as the 6th biggest bank in the continent.   The   Bank   grew   its   shareholder’s   fund   of   N20million   in  1990   to N509.25billion as at year end 2013. Today, the Bank continues to thrive on the strong values,  brand  equity,  corporate  culture  of  professionalism  and  service  excellence which are the foundations upon which the bank was built



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IMPACT OF REWARD SYSTEM ON THE PERFORMANCE OF SELECTED MONEY DEPOSIT BANKS IN ANAMBRA STATE NIGERIA

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