Billionaire businessman and Chairman of FBN Holdings, Femi Otedola, has expressed his strong support for the Federal Government’s proposed 70% windfall tax on foreign exchange gains of banks. In a statement released on Wednesday, Otedola highlighted the necessity of this measure to foster a fairer and more equitable economic environment.

Otedola criticized the banking sector for its estimated $50 million annual bill on maintaining private jets and an even higher bill on their purchase. He emphasized that windfall taxes are crucial for redistributing extraordinary profits gained under unusual circumstances, ensuring a fairer wealth distribution and contributing to essential public services such as healthcare, education, and infrastructure.

“The recent announcement of a windfall tax on the extraordinary profits earned by Nigerian banks is a significant first step towards achieving these goals,” Otedola stated. He explained that 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 US dollars. This extraordinary gain, he argued, should be redirected to fund critical infrastructure development and alleviate the cost-of-living crisis many Nigerians face.

Otedola expressed concern over the banking sector’s culture of extravagance, particularly the ownership and operation of private jets by some bank executives. He criticized this trend as a significant erosion of public trust in financial institutions and a diversion of resources away from vital areas such as operational efficiency, technological innovation, and customer service.

“Nigerian banks are spending an estimated $50 million annually just on maintaining private jets, with over $500 million going into purchasing nine private jets by four banks. This level of extravagance significantly erodes public trust in our financial institutions,” Otedola remarked. He called on banks to realign their financial priorities and invest in areas that directly improve customer services and enhance technological infrastructure.

Otedola also commended the recent recapitalization initiative in the banking sector, stating, “This move is designed to strengthen the banking sector’s capacity to support Nigeria’s broader economic development goals. Banks must focus on operational efficiency, technological innovation, and customer service, rather than executive extravagance.”

In July, the Senate amended the Finance Act to impose a 70% windfall tax on banks’ foreign exchange profits, with President Bola Ahmed Tinubu indicating that the revenue would be used to fund the N6.2 trillion supplementary budget.