Shareholders of Skye Bank Plc have endorsed the plan by the bank to raise additional capital of up to N50bn.

A statement by the bank explained that the shareholders gave the approval on Wednesday during the bank’s seventh Annual General Meeting in Lagos.

They also approved the bank’s plan to raise the money from the capital market as well as from local, foreign and other investors, whether by private placement, public  or rights offer and issuing ordinary shares for such equity.

The bank said the additional fund was needed to strengthen its balance sheet and support its business expansion.

The Group Managing Director/Chief Executive Officer, Skye Bank, Mr. Kehinde Durosinmi-Etti, said the bank would raise tier 2 capital before the end of the third quarter and seek additional funds through tier 1 issue in the nearest future.

He said the bank had been growing and needed to shore up its capital base.

According to him, given the way the bank has optimised its capital, additional funds will lead to better value creation for all stakeholders.

Skye Bank’s results for the year ended December 31, 2012 showed that profit after tax leapt to N12.64bn, representing an increase of 872.6 per cent over the N1.30bn recorded in 2011. Its profit before tax also rose by 480.9 per cent from N2.84bn in 2011 to N16.51bn in the year under consideration.

 The bank maintained a steady top-line in 2012 with net interest income and net non-interest income of N44.50bn and N22.60bn, respectively.

The statement added that on the basis of the impressive bottom line, the board had recommended an increase in dividend per share from 25 kobo paid for the 2011 business year to 50 kobo for 2012.

Earlier this week, the bank’s management had announced plans to invest up to $150m in the power sector before the end of the year.

Durosinmi-Etti said  about 17 per cent of the loan portfolio would also be invested in the upstream oil and gas sector, adding that it  might also be involved in the purchase of  some banks put up for sale, and that if any of them was worth buying, Skye Bank might consider it.

“The bank plans to invest between $100m and $150m in power by the end of the next quarter; also, we will be investing about 17 per cent of our loan portfoilio in the upstream oil and gas sector,” he said.

He explained that the bank was involved in various activities aimed at building its brand and improving its customer base, adding that it had also been involved in various efforts aimed at strengthening service platforms in its branches.

Source: Punch (by Udeme Ekwere)