ALEX OTTI'S FAILED GUBER AMBITION COST 1000 DIAMOND BANK STAFFERS THEIR JOB

The failed governorship ambition of former MD of Diamond Bank, Alex Otti has cost about 1000 employees of the Bank their job. The development came about as report filtered in today that  Diamond Banks Plc. has sacked over 1,000 workers because the financial institution is broke and it cannot pay the workers.

Other reports claim that the tighter CBN monetary policy may also be a factor leading to the sacking of its employees. While others say that the regulatory measures introduced by the Central Bank of Nigeria aimed at protecting the economy, has started affecting the banks’ profitability. According to reliable sources, the bank is also planning to reduce the number of new branches to be opened this year as a measure of combating its present predicament.

Inside source attribute the banks dwindling fortune to the political escapades of its former managing directors Mr Alex Otti who took out huge loans from the bank to fund his political campaigns for a gubernatorial seat in Abia State. Alex who ran under APGA, lost the election to the PDP.

The development has also affected the profit of the company, the 2015 first-quarter pre-tax profit of the bank fell by 9.5 per cent to 8.36 billion naira ($42 million) from a year earlier. The bank did not disclose why profit for the period end-March fell but said in a statement that revenue climbed 5.8 per cent during the period to 40.48 billion naira. The banks profit after tax also fell by 10.72 per cent to N25.48 billion in 2014, compared with N28.54 billion in 2013 as regulatory induced costs continue to suppress profit.

Its operating expenses also increased by 19.89 per cent to N92.86 billion in 2014 from N77.40 billion in 2013. Cost-to-income ratio, which measures the ability of a bank in cutting costs while boosting profit, reduced to 72.30 per cent in 2014 as against 66.57 per cent in 2013