Skye Bank Recorded N13bn Earnings In First Quarter

Akinsola Akinfemiwa - Managing Director/CEO

Skye Bank Plc has recorded gross earnings of N12.5 billion for the first quarter ended December 31, 2007.

This represents an increase of N3.8 billion over N8.7 billion recorded in the corresponding period last year. A statement from the bank said profit before tax also grew by N2.9 billion from N1.2 billion in the corresponding period of the previous financial year to N4.1 billion. This indicates an increase of 241.66 per cent.

Profit attributable to shareholders stood at N2.8 billion, showing an improvement of N1.98 billion or 242.42 per cent over N817.7 million recorded in the previous first quarter. This translates to earnings per share of 37.31 kobo.

The statement added that the profit could be traced to the bank’s conversion of 22.40 kobo of every naira earned during the period to profit from the previous 9.39 kobo. This stellar financial performance according to observers is a sign that the management could report better outing to the advantage of investors, than has been projected in the offer document for the rights and public offering.

The on-going N50 billion hybrid offer is geared towards positioning Skye Bank for improved service delivery. The bank is currently offering to the investing public a total of for 2.231 billion ordinary shares at N14.00 each; and 1.50 billion shares by way of rights to existing shareholders at N12.50 each. From the 1.785 billion ordinary shares of the offer that has been underwritten, the bank hopes to preferentially allot 446.139 million units at N14 each to identified investors. The offer is expected to close on February 20, 2007.

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According to the offer prospectus, the offer proceeds “will be used to deepen Skye Bank’s retail infrastructure in Nigeria, strengthen subsidiaries’ capital base to support business growth, expand Skye Bank’s capital, network of branches and fund its working capital.”

Mr. Kehinde Durosinmi-Etti, deputy managing director of the bank explained at a media parley on Monday in Lagos that the amount being sought would be sufficient for now, considering the business being currently undertaking by the bank. The offer, he noted, is being undertaken because the board and management believes hat “there is further need to grow and consolidate he gains so far recorded within the last two years of operation. There is a lot of demand in the economy for banks to support growth and development in terms of project finance, consumer lending and so on.”

The DMD noted that amount being sought is just enough for the kind of business the bank intends to do for now. “The issue of capital (raising) is a continuous one. There are various ways of raising capital, and as the business environment dictates, we will be raising more funds. We feel we should do it in phases; we should be a bit more strategic. We felt that this is the amount of money we should have and still compete well. It is adequate for now to finance growth expansion,” he stressed.