Otedola urges banks to embrace windfall tax, cut lavish spending

Femi Otedola, chairman of FBN Holdings and Geregu Power Plc, has thrown his weight behind the new windfall tax policy of President Bola Tinubu’s administration.

The windfall tax policy is targeted at charging 70 percent of banks’ foreign exchange (FX) gains.

In a statement on Wednesday, Otedola condemned the lavish spending habits of some bank executives, highlighting their misuse of resources on private jets at the expense of shareholder and customer interests.

Otedola, a billionaire businessman with influence in the financial and power sectors, expressed concern over a growing trend of bank chief executives prioritising personal gain.

“A concerning trend has emerged where some bank chief executives prioritize personal gain over their duty to shareholders and customers,” he said. “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.”

According to Otedola, Nigerian banks spend an estimated $50 million annually on maintaining private jets, noting that over $500 million has been expended on 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,” he said.

Otedola emphasised the need for the banking sector to realign its financial priorities to regain public trust and fulfill its role in Nigeria’s economic development. He called for investments to be directed toward improving customer service and enhancing technological infrastructure.

Supporting the implementation of the windfall tax, Otedola highlighted its potential to create a more equitable economic environment. “Windfall taxes, which are levies on companies or individuals who receive substantial, unexpected profits, ensure a fairer distribution of wealth,” he said. “This allows those who benefit disproportionately to contribute more significantly to the broader societal good.”