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Tag: SKYE BANK

  • Skye Bank explains closure of Ejigbo branch

    Skye Bank explains closure of Ejigbo branch

    The management of Skye Bank Plc has explained why it closed its Ejigbo branch in Osun State.

    Head, Corporate Communications,  Rasheed Bolarinwa said the branch was  relocated to Ede, 25 kilometres away, following incessant robbery attacks.

    He said before it was finally shut in 2010, the branch was robbed five times.

    But the community’s monarch, the Ogiyan of Ejigbo, Oba Omowonuola Oyesosin,  alleged that the management wanted to sell the  building and land given to the bank by the community.

    In a statement explaining the closure of the branch, Bolarinwa was, however, silent on the monarch’s allegation.

    Skye Bank said: “The respected traditional ruler addressed a press conference the same day the bank received a letter of complaint from him, thereby foreclosing any form of amicable settlement before the media reports came out.

    ‘’The bank holds the traditional ruler in high esteem and would continue to explore peaceful avenues to resolve the issue.

    “The closure, a last resort, was the only course of action for the bank after the monarch could not give any assurance of improved security in the town after several engagements with the bank. The community was then advised of the nearest branch at Ede or Iwo.

    “The bank subsequently obtained the approval of the Central Bank of Nigeria (CBN) to close the branch on account of the prevailing security threat.

    ‘’In 2013, the community sought after two competing banks to occupy the facility. They took the banks straight to Skye Bank’s General Services Department (GSD), to negotiate an exchange.

    “This was in view of our assets (building and equipment) on ground. The community was eager to bring back a bank into the town. Their efforts proved abortive following their inability to provide evidence of improved security to the potential banks.

    “In late 2014, they approached Skye Bank with the possibility of returning to Ejigbo.”

    The bank said it has not done anything illegal or unconstitutional by considering the closure of a branch “where security breach and loss of assets, which undermine its continued operations, have become the order of the day.  The safety of our employees and assets remains the overriding factor in our business decisions, and this will continue to remain so.”

  • Skye Bank refreshes corporate identity

    Skye Bank has unveiled its ‘Skye is Big Enough’ campaign aimed at promoting the its new “Smart” unique selling proposition.

    The bank’s Executive Director, Corporate Services, Abimbola Izu said the campaign became necessary to align with evolving market trends as well as draw attention to the bank’s enormous capacity in ensuring customers convenience and maximum comfort at all times.

    “The entire world is under very serious economic stress and pressure, but in the midst of the pressure, we find opportunities to shine. Skye Bank is seizing the moment to reposition itself for the challenges and the opportunities that abound in the market place as we evolve,’’ she said.

    According to her, the essence of the campaign was to tell the customers that Skye is big enough to handle all forms of business transaction, as well as have smart, intelligent and innovative technologies that support the businesses of its customers.

    She said the lender was adopting all its platforms to convey its message. Also, the bank would soon commence an advertising campaign that highlights the new realities and its capabilities using the success stories of individuals. The excercise, she said, would ‘drive home the point that the Skye is Big Enough for anyone that is determined to succeed’.

    Izu said the bank’s acquisition of Mainstreet Bank last year, as a proof  of its determination to leapfrog into the league of bigger and stronger institutions that are major players in the evolving global economy.

    She noted that the acquisition also gives Skye Bank the leap in the electronic channel business, with a total ATM network of 849 for their customer convenience.

    “Our Skye Mobile channel is also going to be re-launched as we have revamped it. All these we have reworked just for customer’s convenience and comfort.”

     

  • Skye Bank seeks stay of execution over N450m damages

    Skye Bank seeks stay of execution over N450m damages

    The Skye Bank Plc has asked for stay of execution of judgment requesting it to pay the sum of N421, 384,000, as general damages and N25million as special damages to Tuns International Holdings by the Court of Appeal sitting in Akure. The bank is asking for stay of execution pending the final determination of the appeal lodged against judgment at the Supreme Court.

    The Court of Appeal sitting in Akure, Ondo State had earlier awarded the sum of N446, 384,000 as damages against Skye Bank Nigeria Plc, for breach of contract against Tuns International Holdings Ltd.

    In a lead judgment delivered by Justice Muhammed A, the court upheld the earlier judgment of Justice A.O. Ogunlade of Osun State High Court sitting in Osogbo which last year ordered Skye Bank to pay the Tuns holdings the sum of N421, 384,000, as general damages and N25million and special damages.

    The three member panel of Justices of the appellate court, while dismissing the appeal filed by Skye Bank, held that the trial court had the right to award both special and general damages to the respondent (Tuns International Holdings) for the injury it suffered in a business transaction with the appellant.

    Justice Ogunlade of Osun State High Court on March 14, 2014 awarded the damages, dissatisfied with the judgment, Skye Bank initially filled notice of appeal which was followed with 9 grounds of appeals from which two issues were formulated for the determination of Appeal Court.

    Both Justice Sontonye Denton West (JCA) and James Sheu Aribiyi (JCA) agreed with the judgment. It will be recalled that this is the third time that Skye Bank in a span of one month would be awarded damages against by the Court in favour of Tuns in different matters bothering on breach of Contract. The first one was N2.5billion while the second was N902 million, both judgments were delivered in May by Justice Denton West the presiding Judge of Appeal Court, Akure.

  • R-TAG: Skye Bank’s new deal for customers’ satisfaction

    R-TAG: Skye Bank’s new deal for customers’ satisfaction

    The Customer being king, is an age old mantra that continues to inspire global businesses, and propel shreud  CEOs  and business leaders to re-align their processes to deliver value to the customer. Smarting from its enlarged position since its acquisition of the erstwhile  Mainstreet Bank, Skye Bank looks set to reconfigure its business strategy and product offerings in a bold new customer- centric move labeled, ‘Retail Transformation and Growth,’ writes Emmanuel Udodinma

    For several months and at various fora, Skye Bank has been talking about streamlining operations to play big in the Retail (defined as Consumer and Small and Medium Enterprises) sector, a position made good after its recent acquisition of Mainstreet Bank.

    All doubts and misgivings were however laid to rest last week as the Bank formerly unveiled its Retail Transformation and Growth (R-TAG) strategy to its customers and the general public. The customer-public is without doubt a major stakeholder group, whose consumption pattern is a factor in determining  the success or otherwise of any enterprise.

    With R-TAG, Skye Bank has moved its approach to Retail Banking from a product-led, to a customer-focussed model with a clear identification of four primary focus-segments, namely: mass market, emerging middle class and mass affluent (for Consumer Banking) and SME’s.

    In a release after the launch, the bank explained the rational behind the R-TAG as a move, “designed to revolutionise retail banking business in the country and serve as a game-changing business model with focus on customer segments, using unique value-propositions, rather than the product-led approach commonly adopted by Retail organisations. This is the key to activating the bank’s new retail sales approach which is based on a ‘Pull’ strategy, supported by a positive customer experience across its key service touch points.”

    Just before the formal launch, the Group Managing Director/CEO, Mr. Timothy Oguntayo, said RTAG was conceived because of a desire to meet customers’ needs and that, it was the result of wide consultation.

    He said with R-TAG, the bank’s products are not only streamlined, but they are also  loaded with a lot of benefits because customers deserve a lot from the financial entity.

    He expressed confidence that the program will turn out to become a huge success and would lead others in the Nigerian market space. “We are confident it matches and surpasses competition” he said.

    For the Bank’s Executive Director, South-South, South-East and Retail Banking, Mrs. Ibiye Ekong, said it was the natural route to go. Perhaps alluding to the on-going integration of Mainstreet Bank and Skye Bank and the tie-in with R-TAG, Mrs. Ekong said, “That is not unusual because we have the network. Let us begin to work the network to deliver value to customers and ultimately to the organisation.

    “We have done classification of our branches, moved personnel around and engaged direct agents so that the footprints for retail customers are expanded,” she said.

    On how the bank adopted  the R-TAG strategy, she said: “After that phase, we came up with a transformation agenda that sought to find out from customers what products they would want.

    ‘’We entered into the process of working with experts; with IFC, we worked with some retail experts and other international companies on how to design structures that will deliver value. What you have seen today is the first phase of actualization of that objective.

    “We now have products clearly defined and streamlined. We used to have a long array of products and what you find is that people get confused, delivery becomes a problem; customers do not know how one translates to the other. We have been able to identify the product, clearly demarcated so that, from one level to the other you know what you are getting being a customer of the Bank,’’ Mrs. Ekong said.

    At the project launch in Lagos earlier in the month, Oguntayo, assured that the new business transformation agenda would bring about customised and needs-satisfying financial solutions in a manner that will exceed the expectations of customers.

    He pointed out that the trend in retail banking requires  the service provider knowing the needs of the customer beyond finances,  to include Lifestyle needs and designing appropriate solutions to meet those needs. He assured that Skye Bank is poised to serve as a dependable partner to its customers across the country.

    His words: “Our renewed drive and focus on retail banking is anchored on the premise of building a long-lasting relationship with our customers, based on trust as well as supporting the financial inclusion drive of the Central Bank of Nigeria, so as to bring a lot more people into the financial system and the formal economy.”

    This is the reason, he said the bank has instituted its ‘Reach for the Skye Millionaire Reward’ scheme as a product feature for its flagship savings product, designed to encourage the savings culture amongst the mass market segment.

    He said the current banking environment as well as the acquisition of Mainstreet Bank, which after integration will significantly increase the branch footprint of Skye, signifies a clear competitive advantage for Skye Bank to follow the Retail Banking model.

    In accordance with the CEO’s exposition, the Bank’s Head, Retail Banking Group, Ms. Nkolika Okoli, said, before now, serving the Retail market was based on a product approach but with R-TAG, the new strategy is now reversed with the customer as the main focus.

    “The reason for streamlining our Consumer Banking business into three primary focus areas, is to make it easier for customers to derive value and make it easier for the Bank to serve them.”

    She also said that the Bank is removing barriers to banking by paying savings’ customers the monthly interest due to them irrespective of the number of withdrawals made on their accounts, which is a move in support of the Central Bank of Nigeria’s (CBN) financial inclusion policy.

    In this regard, she said mass market current accounts would attract zero Cost on Transaction (COT) and free debit cards among other values.

    According to her:  “The R-TAG project has helped streamlined the bank’s product portfolio targeted at Individuals and SME customers, via the identification of primary-focus segments, with a maximum of two-products to serve each segment.

    The bank has also pioneered the issuance of free debit cards and cheque books to retail customers, as well as removal of all withdrawal barriers on savings account types as incentives to encourage adoption of financial services by customers of all classes thereby making banking affordable to all, Ms. Okoh stated.

    Skye Bank’s trading results, indicating an upward movement in Pre-tax profit, and the almost 46 percent rise in the bank’s equity price since early January, are clear signs that the investment public is taking cognisance of the bank’s strategic actions and stocking up on the it’s shares, more so now that the bank reresents a bigger, well managed and focussed entity, delivering better results to stakeholders.

  • Skye Bank launches new retail banking roadmap

    In a quest to reposition its Retail Banking business and make it the centre-piece of its business focus, Skye Bank Plc. has embarked on a comprehensive transformation of its retail offerings, focusing essentially on the needs of customers in its identified target segments, individuals and Small and Medium-sized Enterprises, SMEs.

    The Bank’s new Retail strategy code-named Project R-TAG, ‘Retail Transformation and Growth’, is designed to simplify Retail Banking business and serve as a game-changing business model with a focus on customer segments using unique value propositions rather than the product led approach commonly adopted by Retail organisations.

    Speaking at the launch of the project in Lagos, the Group Managing Director/Chief Executive Officer of the Bank, Mr. Timothy Oguntayo, assured that the new business transformation project would bring about customised and needs-satisfying financial solutions in a manner that will exceed the expectations of the customers.

    Oguntayo said the trend in retail banking involves knowing the needs of the customer beyond finances to include lifestyle needs and designing appropriate solutions to meet those needs, saying, ‘Skye Bank is poised to serve as a dependable partner to its customers across the country.’

    In her remark, the Executive Director, South South, South East and Retail Banking, Mrs. Ibiye Ekong, said amendments to the Bank’s existing retail products is to streamline and position them for better fit with the identified customer segments.

    Also speaking at the occasion, Head, Retail Banking Group, Nkolika Okoli, said the R-TAG project would help streamline the Bank’s product portfolio targeted at Individual and SME customers via the identification of primary focus segments, with a maximum of 2 products to serve each segment.

    Meanwhile, a businessman residing in Kaduna State, Mukaila B. Hamzat emerged the first winner of the Bank’s ‘Reach for the Skye Millionaire’ reward scheme. Mr. Hamzat, a former Mainstreet Bank savings account holder, now merged with Skye Bank, was selected during an electronic draw from over 400, 000 customers during the launch of the retail banking project.

    Three customers would emerge as millionaires each month during the monthly promo draws. The next draw event is scheduled for the first week of July.

  • Shareholders approve Skye Bank’s absorption of Mainstreet Bank

    Shareholders approve Skye Bank’s absorption of Mainstreet Bank

    Shareholders of Skye Bank Plc have given the final nod to the acquisition and absorption of Mainstreet Bank Limited, paving the way for the emergence of the enlarged Skye Bank Plc.

    At the court-ordered extra ordinary general meeting held immediately after the bank’s 9th annual general meeting yesterday in Lagos, shareholders considered and approved Skye Bank’ proposed scheme of external restructuring which deals with the acquisition and consolidation of the operations of Mainstreet Bank with Skye Bank Plc.

    The Asset Management Corporation of Nigeria (AMCON) had on December 19 transferred full ownership of Mainstreet Bank Limited to Skye Bank Plc. The transfer of full ownership took place after a completion meeting where AMCON divested its interest and transferred full ownership of the bridge bank to Skye Bank. Skye Bank had successfully paid 100 per cent of the acquisition value and received regulatory clearance as the new owner.

    Chairman, Skye Bank Plc, Mr. Tunde Ayeni, yesterday confirmed that the Securities and Exchange Commission (SEC), had given its clearance to the scheme.

    He explained that after the clearance of the scheme by SEC, an application was filed at the Federal High Court which directed that the meeting of the shareholders of the banks be convened and the scheme be presented for their consideration and approval.

    The Nation had reported that the full integration and switchover of the operations of Mainstreet Bank Limited to Skye Bank, including the adoption of the Skye Bank’s brand and flag in all Mainstreet Bank’s offices, would be completed this month.

    Highlighting the benefits of the acquisitions, group managing director, Skye Bank Plc, Mr. Timothy Oguntayo, said the business combination would create a platform where significant synergies could be obtained for the benefits of the shareholders, , employees, customers and the economy as a whole.

    He added that the combination would provide opportunity to reposition the enlarged Skye Bank as a tier 1 bank within the Nigerian financial services space based on the expected benefits arising from economies of scale and scope.

    “A business combination of this nature will potentially lead to revenue enhancements and cost savings for the enlarged Skye Bank with a wider customer base,” Oguntayo said.

  • Skye Bank appoints four executive directors

    The board of directors of Skye Bank Plc has announced the appointment of four new executive directors for the bank as part of the efforts to uphold the high standards, which have become the bank’s driving force for service excellence.

    The new executive directors are Mr. Bayo Sanni, Executive Director, Lagos Commercial Banking; Mr. Idris Yakubu, Executive Director, Abuja and Northern Region; Mrs. Markie  Idowu, Executive Director, Technology and Service Delivery Channels; and Mrs. Abimbola Izu, Executive Director, Corporate services. The appointments will take effect as from next month.

    Announcing the new board appointment in a statement yesterday, group managing director, Skye Bank Plc, Mr. Timothy Oguntayo, expressed confidence that the new directors would further strengthen and reposition the bank for improved performance.

    Sanni, who holds both Bachelor and Master’s degrees in finance from the University of Lagos, was, until now, the chief risk officer at FCMB where he quickly effected the reduction of the non-performing loans and the cost of risk for the institution.

    He started his banking career with Zenith Bank, and had worked in other leading financial institutions, including Citibank and Sterling Bank. His experience in these banks covered various aspects of banking including banking operations, corporate banking, commercial banking, compliance and risk management.

    Yakubu who holds a B.Sc Accounting degree from the University of Jos, also bagged his M.sc degree in Banking and Finance from the same institution, and an MBA degree from the Ahmadu Bello University, Zaria.

    With over 25 years of banking experience spanning Fidelity Bank (where he spent 19 years), Yakubu was until his present appointment, the Regional Director, Abuja and Northern Business, Fidelity Bank, where he significantly grew the business both in size and profitability. His experience covers commercial, consumer, retail banking and public sector. He also has significant experience in corporate banking, financial control and tax planning services.

    Izu holds the LL.B and LL.M degree from the University of Ife and University of Warwick, Coventry, England and was admitted to the Nigerian Bar in 1987. A multiple award winner as an intellectual prodigy, she is also an alumnus of the Lagos Business School.

    A seasoned legal luminary with several years experience in law practice both in private legal practice and in the banking industry, she started her legal career with Bentley, Edu& Co, moving on to AfeBabalola& Co, and Olaniwun Ajayi & Co.

    She started her banking career in with the legacy Bond Bank as pioneer company secretary and legal adviser. She later became the company secretary and legal adviser  for Skye Bank, and was at various times, also anchored  the Corporate Communications department of the bank, during  which time she led the team in establishing Skye Bank as a household name and a foremost brand in the financials services industry, from a zero brand position.

    She currently oversees the Corporate Services directorate which includes Company Secretariat, Legal services, General Services Department, Corporate Communications, and Sustainability and Consumer Protection Department.

    Idowu holds a First Class degree in Computer Sciences from the University of Benin, and a Masters degree in Software Engineering from Aston University, Birmingham, and MBA degree from the Lagos Business School.

    She has over 26 years banking experience spanning Commercial Banking, Corporate Banking, Private Banking, and Strategic Planning. She had worked as Head, Corporate Banking Group where she positioned the Bank as a major player in the upstream oil and gas and telecoms sectors. Since assuming duty as Head, Technology and Service Delivery Channels, she has significantly improved the bank’s service delivery via electronic and IT platforms.

     

  • Skye Bank: N6b Q1 PBT pointer to healthy growth

    Skye Bank: N6b Q1 PBT pointer to healthy growth

    The benefits of the new status of Skye Bank, following its acquisition of Mainstreet Bank, have started manifesting. Its N6billion Q1 profit is a pointer to this fact, writes Alvin Afadama.

    Skye Bank’s acquisition of Mainstreet Bank is beginning to yield appreciable results as the consolidated result for the first quarter ending March 31, 2015 has  shown a significant rise in earnings and profit, thus justifying its decision to acquire the new bank.

    The expanded business activities is immediately reflected in the sharp rise in gross earnings which rose to N42.3 billion in the first quarter of 2015 from N34.3 billion in 2014, appreciating by 23 per cent.

    The bank announced pre-tax profits of N6.2 billion, representing an increase of 82 per cent over the N3.4 billion recorded during the same period in 2014.

    The bank’s bottom-line followed the growth trajectory as net profit or profit after tax sprang up to N5 billion during the review period compared to N2.7 billion achieved during the corresponding period in 2014, an 85 per cent rise.

    In marginal terms, pretax profit margin for the period rose to 14.7 percent from less than 10 percent in the corresponding quarter. In percentage terms, this is over 49 percentage points from the equivalent quarter.

    What this means is that where the bank used to translate every one hundred naira put in the business to N9.9, in the quarter under review, it made N14.7.

    The result is a strong indication of a more efficient bank that promises to consolidate on the gains.

    The rapid improvement in the fee based transaction of the bank is evident of the bank’s strategy of leveraging the fee and commission income opportunities in the Nigerian economy. Fees and commissions rose to a whopping N10.2 billion from the previous figureof N6.2 billion in the corresponding period in 2014, a 65 percent improvement.Fees and commissions are complementary to the bank’s interest earning assets.

    The bank’s Group Managing Director and Chief Executive Officer (CEO)Timothy Oguntayo, while commenting on the results said that Skye Bank was set to deliver superior value and returns to shareholders as the bank enters its new strategic growth phase.

    Oguntayo said the bank would leverage the acquisition of Mainstreet Bank Limited to take its services closer to its current and prospective customers and expand its bouquet of value adding offerings to meet the diverse needs of its various stakeholders.

    The IFRS compliant result also shows the bank’s total assets hitting N1.43 trillion as against N1.42 trillion during the same period in 2013. Similarly, its total liabilities, including total deposits, stood at N1.3 trillion as against N1.2 trillion in the preceding year.

    The shareholders’ fund also rose to N137.3 billion from N132 billion in the period.

    Upon releasing the results last Thursday, investors rewarded the bank by helping to shore up the bank’s stock price to N2.7 as at the close of trading on the NSE. It was a clear 10 kobo appreciation over the previous day when the stock traded at N2.60.

    The rise on Thursday represents a 46 percent rise in the Bank’s stock price since early January, a sign that the investment public is taking note of the Bank’s strategic actions and are stocking up on the Bank stocks.

    Analysts had predicted the positive growth trajectoryin the Bank’s financial as reflected in the 2014 Full year results.

    The Bank’s 2014 Full Year results which had a significant appropriation to retained earnings, suggests a willingness to deploy resources to growth segments of the Bank’s business.

    The results submitted to the Nigerian Stock Exchange (NSE) last week revealed that the bank yanked up retained earnings in the year under review from N19.73 billion in the 2013 financial year to N33.7 billion, a 70.6 percent growth.

    The huge commitment to reserves may not be unconnected to the Bank’s tier one ambitions which requires significant investments, analysts insist.

    The first quarter results already confirms this suggestions as it has begun consolidating gains from last year towards playing big in Nigeria’s highly competitive but highly rewarding retail sector.

    That playbook can be read from the Mainstreet acquisition, which the bank plans to fully integrate by June this year. By subsuming Mainstreet, analysts say Skye Bank would figure among the first four banks in the country. Rightly so because it would vault the number of branches to about 450 branches across the country.

    When integration is complete, the consolidated bank should be able to configure competencies towards cost leadership, business optimisation, stronger profit and greater ability to offer business convenience to retail and commercial customers across all geographies, analysts say.

    The bank had in a statement after the acquisition said the move, will bring valuable synergies from the mutual focus areas of commercial and retail banking of the two entities in a larger Skye Bank. The bank noted that its focus is on retail and commercial banking, which are also the main focus areas of Mainstreet Bank Limited.

    Financial analysts are also convinced that the bank will automatically leapfrog other banks in the tier 2 category to become a major tier-1 player in the banking industry.

    The 2014 Financial results indicate that Operating income was up marginally to N69.33 billion from N68.5 billion, which goes to speak of the bank’s improving ability in efficient cost management. This was on the back of a 2.4% rise in interest income from N105.3 billion to N107.85 billion.

    Though interest income rose only in marginal terms, it, nonetheless, shows that the bank is succeeding in its maturity transformation function. This much is demonstrated in the loan deposit metric, which slowed in the period under review.

    A slow down in this metric is indicative of a cautious approach towards credit risk.

    Interest income is an indicator that helps explain how well a bank is doing in its maturity transformation quest.

    According to figures in the full year result, bank grew assets over the 2013 full year by27% from N1.12 trillion to N1.42 trillion, helping to provide a stronger cover for deposit liabilities. The metric improved to 1.5 from 1.3. This is as the bank grew deposits 15.7% to N952.3 billion from N823.3 billion.

    A robust deposit base indicates a bank’s strong marketing ability, especially in attracting and mobilising deposits. Deposit mobilisation is a key indicator of a bank’s growth prospects given the emergence of a very choosy class of emerging middle class in Nigeria.

    The group’s liabilities consisting of deposit base and other accruals rose to N1.29 trillion during the period compared to N995 billion achieved a year ago.

    Of that performance, Oguntayo, said in spite of the challenging operating environment, the bank carefully grew its risk assets portfolio, attained a 15.7% growth in deposits, supported customers in critical and productive sectors of the economy, and declared a fairly decent profit.

    Oguntayo said the recent acquisition of Maintreet Bank Limited, which has resulted into a much larger franchise of over 450 branches, provides the bank with enhanced capacity to provide easier access to its teeming customers, and explore various opportunities in diverse segments of the economy.

    Oguntayo assured those who have kept their investment with the bank, along with other stakeholders that the synergies and economies of scale expected from the Mainstreet acquisition will begin to manifest from the current financial year, while promising current and potential customers of consistent quality service on all electronic platforms and in the business locations.

     

  • Skye Bank’s 70 per cent growth buoyed by new acquisition

    Skye Bank’s 70 per cent growth buoyed by new acquisition

    The acquisition by Skye Bank of Mainstreet Bank, has repositioned the entity to being a key player with the status of tier-1 bank, reports, Alvin Afadama.

    The operating business environment in the country is not as conducive  as it should be given the depressed naira and spiraling cost of doing business. The unfriendly business environment is made worse by the hefty transactions costs of a take-over target, coupled with integration bills which constitute depressants to a bank’s bottom line.

    However, Skye Bank waded through these stormy waters unscathed, even increasing retained earnings for future growth as its 2014 full year results have shown.

    The results submitted to the Nigerian Stock Exchange (NSE) last week revealed that the bank upped retained earnings in the year under review from N19.73 billion in the 2013 financial year to N33.7 billion, representing a 70.6 per cent growth.

    In combination with equity and share premium, the bank’s total equity swelled to N132.26 billion from N121.4 billion, indicating a 9 per cent rise. An increasing and robust equity base is a necessary condition for protecting and growing depositors funds. It is the pillar upon which modern banking rests.

    It may seem curious why a bank that recently made an audacious but significant acquisition of  Mainstreet Bank for N126 billion, made such an appreciable return and beefed  up shareholders’ funds. The fact that the bank is positioning to play in the tier one space may well be the reason.

    It confirms suggestions that the bank is on the verge of making significant investments to consolidate its gains last year and define its playing field in the new financial year. It’s about deepening its root in the retail market, which is estimated at about $700 billion.

    That much can be read from the Mainstreet Bank’s acquisition, which is expected to be fully integrated with the parent bank by June. By subsuming Mainstreet, Analysts say Skye Bank would feature among the first four banks in the country. This is so because the new entity  would  boast of about 450 branches across the country.

    Commenting during the early stages of the acquisition, the Chief  Executive Officer (CEO), Proshare, Olufemi Awoyemi, said: “The acquisition will clearly improve the industry positioning of Skye Bank to between seventh and eighth position, depending on the applied parameters.

    “Specifically, and using their 2013 audited financial statements, the combined entity will rank eighth  in terms of  Profit Before Tax (PBT), Total Assets and Deposits.”

    The newly acquired competences will allow the bank achieve cost reduction, business optimisation, stronger profit and greater ability to offer business convenience to retail and commercial customers across all geographies, analysts have posited.

    The bank had in a statement after the acquisition, said the move, will bring valuable synergies from the mutual-focussed areas of commercial and retail banking of the two entities in a larger Skye Bank. The bank noted that its focus is on retail and commercial banking, which are also the target areas of Mainstreet Bank Limited.

    Financial analysts are also convinced that the bank will automatically leapfrog other banks in the tier-2 category  to become a major tier-1 player in the  banking industry.

    The 2014 Financial results indicate that Operating income was up marginally to N69.33 billion from N68.5 billion, which goes to speak of the bank’s improving ability in efficient cost management. This was on the back of a 2.4% rise in interest income from N105.3 billion to N107.85 billion.

    Though interest income rose only in marginal terms, it nonetheless shows that the bank is succeeding in its maturity transformation function. This much is demonstrated in the loan deposit metric, which slowed in the period under review.

    Interest income is an indicator that helps explain how well a bank is doing in its maturity transformation quest.

    The bank’s headline and bottom-line profits in the period under review were temperedby impairment charges, regulatory payments and higher operating cost, including cost of acquisition Mainstreet Bank (N126 billion) among other costs. These muscled-down pre-tax profit 46.7% from N19.65 billion to N9.74 billion.

    Because these depressing cots would have been trounced, the bank would likely see improved headline and bottom line profit in the first quarter of 2015 as the profits of Mainstreet Bank would be reflected in the books of the integrated Skye Bank.

    The bank has over the last year grew assets 27% from N1.12 trillion to N1.42 trillion, helping to provide a stronger cover for deposit liabilities. The metric improved to 1.5 from 1.3. This is as the bank has grown deposits 15.7% to N952.3 billion from N823.3 billion.

    A robust deposit base is an indication of a bank’s strong marketing ability especially in the area of attracting and mobilising deposits. Deposit mobilisation is a key indicator of a bank’s growth prospects given the emergence of a very choosy class of emerging middle class in Nigeria.

    The Group’s Liabilities consisting of deposit base and other accruals rose to N1.29 trillion during the period compared to N995 billion achieved a year ago.

    Speaking on the results, the bank’s Group Managing Director/Chief Executive Officer, Mr. Timothy Oguntayo, said in spite of the challenging operating environment, the bank carefully grew its risk assets portfolio, attained a 15.7 per cent growth in deposits, supported customers in critical and productive sectors of the economy, and declared a fairly decent profit.

    Oguntayo said the recent acquisition of Maintreet Bank Limited, which has resulted into a much larger franchise of over 450 branches, provides the bank with enhanced capacity to provide easier access to its teeming customers, and explore various opportunities in diverse segments of the Nigerian Economy.

    The results definitely portray some cheery news for investors who have watched their investment grow in the last financial year.

    The stock price has grown 28.8 per cent since mid-February to N2.46 from N1.91.The bank has consistently figured as the third least risky stock. The bank’s stock was the safest banking stock on (NSE) for the week ended February 27th. This happened at a time when most stocks took a hit following the N793.17 billion portfolio outflow from the Exchange.

    Oguntayo assured those who have kept their investment with the bank, along with other stakeholders that the synergies and economies of scale expected from the Mainstreet acquisition will begin to manifest from the current financial year, while promising current and potential customers of consistent quality service on all electronic platforms and in the business locations.

    At the expiration of the June timeline for integration, Nigeria’s banking space may very well welcome a change in the competitive dynamics as Skye Banks joins the elite group of  other first tier banks.

    Integration would consist of fusing IT infrastructure, Risk Management, Human Resources, Operations, and Strategy, sources close to the transaction say.

    Skye Bank will begin to play in this elite group structuring ticket transactions  needed to vault the Nigerian economy, achieve a wider spread to better serve it customers’ needs, while ramping up margins that come from a larger volume of transactions.

     

  • Skye Bank declares 661m bonus shares as total assets hit N1.4tr

    Skye Bank declares 661m bonus shares as total assets hit N1.4tr

    The board of Skye Bank Plc has recommended distribution of a total of 660.9 million ordinary shares of 50 kobo each as bonus shares to shareholders as the bank grew its balance sheet by about 27 per cent to N1.42 trillion in 2014.

    According to the recommendation released yesterday, shareholders would receive a bonus share for every 20 ordinary shares held by the close of register for the scrip issue. The bonus shares indirectly gave some N1.43 billion to shareholders, according to current valuation of the stock.

    Key extracts of the audited report and accounts of Skye Bank for the year ended December 31, 2014 showed that group total assets rose by 26.8 per cent from N1.12 trillion in 2013 to N1.42 trillion in 2014. Total liabilities also rose by 29.6 per cent to N1.29 trillion in 2014 as against N995 billion recorded in 2013. Loans and advances portfolio grew by 18.4 per cent from N549.9 billion to N651.3 billion. Total equity also increased modestly by 8.9 per cent to N132.3 billion in 2014 as against N121.4 billion in 2013.

    However, the bank’s top-line recorded marginal growth of 3.3 per cent from N132.4 billion in 2013 to N136.7 billion in 2014. Profit before tax meanwhile declined from N19.6 billion to N10.5 billion while profit after tax dropped to N9.7 billion in 2014 as against N18.5 billion reported in 2013. The bank meanwhile grew retained earnings by 71.1 per cent to N33.7 billion in 2014 as against N19.7 billion recorded in 2013.

    The bank indicated that the decline in profit was due to some developments during the year, including elevated impairment charges, regulatory payments, and higher operating cost. It however noted that substantial profit retention underlined the group’s pursuit of growth in a stable, strategic and an enduring manner.

    Commenting on the earnings report, group managing director, Skye Bank Plc, Mr. Timothy Oguntayo said the bank braced the challenging operating environment to carefully grow its risk assets portfolio while attaining a 15.7 per cent growth in deposits.

    He described the performance in 2014 as fairly decent adding that the bank has continued to support customers in critical and productive sectors of the economy.

    Oguntayo pointed out that the recent acquisition of Mainstreet Bank Limited, which has resulted into a much larger franchise of over 450 branches, provides the bank with enhanced capacity to provide easier access to its teeming customers, and explore various opportunities in diverse segments of the Nigerian economy.

    He assured shareholders and other stakeholders that the synergies and economies of scale expected from the acquisition will begin to manifest from the current financial year, while promising current and potential customers of consistent quality service on all electronic platforms and in the business locations.