Skye Bank to raise up to $250m in share sale

Skye Bank Plc, the Nigerian lender that sold bonds last week, said it plans to raise as much as N50 billion ($250 million) by selling stock this year as it seeks to boost liquidity and fund operations, reports Bloomberg. “We are looking at the second to third quarter to raise the funds,” chief executive officer, Timothy Oguntayo, said in an interview on March 27 in Lagos. “Details will be announced after our annual meeting.” Nigeria, Africa’s largest economy and most- populous country, held weekend elections that were generally peaceful and transparent, an observer mission from the Commonwealth said.

Ballots cast by the 56 mil- lion eligible voters are still being counted. The successful holding of the vote could prompt an up- turn in business for banks, Oguntayo said. “The end of the election is expected to increase economic activity and projects that will require funding by banks,” he said. “Our loan growth will be muted, but moderate.”

Skye Bank advanced 1.7 percent to N2.45 by 1:41 p.m. in Lagos trading, valuing the lender at about N32.4 billion. Skye Bank, which sold N20 billion of 90-day bonds last week, needs additional liquidity, Oguntayo said. The lender said March 24 it will sell as much as N100 billion of short-term local debt over the next year to increase cash.

The Lagos-based lender joins banks including Access Bank Plc in raising capital amid measures imposed by the Central Bank of Nigeria to bolster the naira. The regulator in 2013 named eight lenders including Skye Bank as systemically important and said they needed capital adequacy ratios of at least 16 percent.

In 2014, the regulator removed some assets banks were able to count as capital to increase their ability to withstand shocks six years after a financial crisis led to the failure of several Nigerian lenders. Skye Bank has $6.8 billion of assets and capital adequacy of 18.5 percent, according to data compiled by Bloomberg and the lender’s website.