By Nkiruka Nnorom
The Nigeria Sovereign Investment Authority (NSIA), managers of Nigeria’s Sovereign Wealth Funds, SWF, has said it generated N26.3 billion income in 2015, a 67 per cent increase over N15.77 billion total comprehensive income declared in the previous year.
The Fund’s total assets for the period grew by 20 per cent to N213.66 billion, while its investment income stood at N5.8 billion during the one year period.
According to the Authority in a statement, $250 million of additional capital was approved for allocation to it in 2015, saying that the fund will be invested within the new fiscal year using the existing deployment ratio of 40 per cent in Infrastructure Fund, 40 per cent in Future Generations Fund and 20 per cent in Stabilisation Fund.
The Authority disclosed that it on-boarded five Private Equity (PE) fund managers during the year, adding that four of the PEs are Nigerian-based, thereby bringing its total commitments to PE fund managers to 24.
Within the year, it also strengthened its infrastructure intervention framework through co-investments collaborations with other institutional investors.
Commenting, Mr. Uche Orji, MD/CEO, NSIA, said despite the harsh and volatile market environment in 2015 which saw many significant endowments and SWFs suffering losses, NSIA maintained a flat absolute performance thereby protecting its capital.
“The NSIA made fewer, but more strategic investments in 2015. More importantly, NSIA has invested in various private equity investment funds to tap into the high-growth sectors across Sub-Saharan Africa. These represent NSIA’s commitment to invest in alternative assets that offer superior performance and are less correlated to broader public equity market volatility,” the NSIA boss stated.
According to him, “The 2015 fiscal year was characterized by high volatility and global market uncertainty. Currency turmoil, dwindling oil prices and decelerating growth across markets created a difficult investment environment for the Authority. Nonetheless, the overall results were positive”.
He said that though global market volatility is expected to continue in the new fiscal year, NSIA will maintain its strategy of a diversified portfolio to drive returns and mitigate market volatility.
“The outlook for the oil market will remain challenging. Nonetheless, NSIA will continue to explore other asset management opportunities on behalf of the Federation,” he said.
Orji further stated that the Authority would focus on increased investments in infrastructure fund as most of its projects come up to financial close.
He added that NSIA would increase its commitment to development of institutions that would enhance infrastructure investments in Nigeria.
While reviewing performance of the fund, Orji noted that the Authority focused on five key sectors for infrastructure investment, listing them to include agriculture, healthcare, motorways, power and real estate.
In his words: “Agriculture, healthcare, motorways, power and real estate are five out of the 15 investible sectors as contained in NSIA’s Infrastructure Rolling Plan for 2015.
“In the year under review, early works III (EW3) commenced as part of the preliminary construction activities on the second Niger Bridge project site.
Having successfully completed this undertaking in January 2016, coupled with the recent passing of the budget (which expressly contained allocations to the project), engagements toward facilitating financial close have been given added impetus. Once the Concession Agreement and supporting documents are executed, the project is expected to move to financial close,” Orji said.