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Barring any last minute hitch, the shareholders' funds of Skye Bank Plc. will shoot up by 17 per cent to N103 billion at the end of the year, as it has concluded arrangements to raise about N15 billion in fresh tier-one capital.

A source at the bank said the funds, which will be raised through special placement, has continued to generate considerable excitement among international investors, who have given their firm commitment to invest.

The source explained that the commitment is an eloquent testimony to the resilience of the Skye brand and the confidence of current and prospective investors in the capacity of the bank to efficiently pursue its growth agenda.

It would be recalled that the shareholders of the bank, at their last Annual General Meeting (AGM) in May, authorized its board to raise about N100 billion in equity and debt over the next two years.

This initial fund raising exercise, therefore, constitutes the equity part of the proposed funding program, while the balance will be sourced via long term debt which will be raised in the course of the two-year period.

The special placement will be offered at a price of N7, which is 9 per cent discount on the market price of N7.66 per share.

According to our sources, Skye Bank would consider raising additional capital on a periodic basis as a deliberate policy aimed at efficiently achieving its growth and expansion aspirations as various opportunities unfold within the local and international markets.

The former Group Managing Director of the bank, Mr. Akinsola Akinfemiwa, had disclosed early this year that Skye Bank might acquire any of the rescued banks. The bank, as we gathered, also plans to continue to operate as an international bank under the new banking model introduced by the Central Bank of Nigeria (CBN).

One of the primary objectives of the new leadership of the bank led by Mr. Kehinde Durosinmi-Etti is to position the institution as one of Nigeria's most efficiently run banks based on integrity, conservatism, best-practice governance, customer accessibility, robust risk management and continuous creation of shareholder value.

Skye Bank, which was a product of mergers during the banking sector consolidation of 2005, was one of the 10 banks that passed the joint examination conducted by the CBN and the NDIC last year.  The robust capacity of the bank to continue in business and meet sundry liabilities was aptly demonstrated in its capital adequacy ratio, which was 16.83 per cent at the end of the 2009 financial year, well above the regulatory minimum of 10 per cent.

Skye Bank announced gross earnings of N126.67 billion for the year ended December 31, 2009, a significant increase of 70 per cent as against N74.62 billion achieved in 2008. In addition, the bank's net interest income rose by 55 per cent, from N30.47 billion to N47.09 billion.

It declared an increase in operating income from N51.94 billion to N75.02 billion, up by 44 per cent. It also recorded profit before tax of N2.15 billion and profit after tax of N1.13 billion. The bank's loan portfolio increased by 29 per cent, from N246.39 billion to N317.76 billion in the previous financial year.

In the first quarter ended March, 31, 2010 the bank announced unaudited gross earnings of N24 billion and profit after taxation of N2.2 billion in spite of the widely acknowledged challenges of the local and global economies and the Nigerian banking industry in particular.  Its profit before taxation increased by 33 per cent to N2.8 billion from N2.1 billion declared at the end of 2009 financial year.