The loyalty points determine how much % increase of that actual skill will be increased.
Skills are like EXP: points determines how much skills you have and those points are unkown and its important to remember that the boots you receive on your skill points and not on your skills ( a lvl 100 sword wont go to 150 sword with 50% bonus.. the bonus will be added on the skill points you have to be that lvl 100.. which will take you to lvl 102 or so.)
Example:
To be lvl 100 sword you need 1500 skill points.
+ 50% boost
= 2250 skill points.. lvl 102?, 103? idk until they announce it :P