By Peter Egwuatu

Skye Bank Plc has  announced a profit growth of 873 per cent and dividend increase of 100 per cent, triggering a huge scramble for the shares of the bank.

Skye Bank’s market shares at the Nigerian Stock Exchange (NSE) rose by the highest allowable daily percentage change of 10 percent with a gain of N2 to close at N8 per share on Tuesday as investors reacted positively to the earnings report.

Audited report and accounts of the bank for the year ended December 31, 2012 showed remarkable improvement in profitability as the bank harnessed its vast business base and increasingly efficient cost management to deliver impressive returns to shareholders.

The audited report, prepared in line with the International Financial Reporting Standards (IFRS) and approved by all financial services regulatory agencies, was presented to the investing public at the Nigerian Stock Exchange (NSE) yesterday.

Key extracts of the audited report showed that profit after tax leapt to N12.64 billion in 2012, representing a whooping increase of 872.6 per cent over N1.30 billion recorded in 2011. Profit before tax also jumped by 480.9 per cent from N2.84 billion in 2011 to N16.51 billion in 2012.

The bank maintained a steady top-line in 2012 with net interest income and net non-interest income of N44.50 billion and N22.60 billion respectively. On the basis of the impressive bottom-line, the board of the bank has recommended an increase in cash dividend per share from 25 kobo paid for 2011 business year to 50 kobo for 2012.

Commenting on the report, the Group Managing Director, Skye Bank Plc, Mr Kehinde Durosinmi-Etti, said the report reflected the commitment of the bank to its goal of quality and sustained growth and returns to shareholders.

He noted that the improvement in the intrinsic profitability of the bank underscored management’s grasp of competitive edges that the bank should build on as it progresses to its target of a leading top-tier bank.

According to him, “In a year of impactful regulatory interventions, including tight monetary policies, we recorded growth in most of our performance indicators. For instance, we grew our interest income by 35 percent from N74.9 billion to N101.0 billion, signaling an accretion in our volume of business transactions, while customer deposits grew by 22 percent from N645.5 billion to N790.1 billion.

The continuous focus on improved risk management practices yielded dividends as our impairment and provisions charge fell significantly, which positively impacted on our profit before tax of N16.5 billion, a significant growth of 481 percent from N2.8 billion reported in 2011.

“We also recorded a reduction in our operating expenses, from N42.3 billion last year to N40.2billion following the deliberate cost management and efficiency initiatives we commenced in the past few years, in spite of the high operating cost environment.”