NSIA to begin investment of $250m additional capital in 2016 FY
The Nigerian Sovereign Investment Authority (NSIA) will begin the In – vestment of the $250 million additional capital in the 2016 fiscal year using the existing deployment ratio of 40 per – cent in Infrastructure Fund, 40 percent in Future Generations Fund and 20 percent in Stabi – lisation Fund.
The National Economic Council, in November 2015, approved the $250 million additional allocation to the Authority from the $400m LNG dividend be invested in the Nigerian Sovereign Invest – ment Authority to increase its $1 billion capital.
Uche Orji, Managing Direc – tor, NSIA confirmed that the authority received the new allocation which brings total capital of the Authority to $1.25 billion in February 2016 and will be invested within the new fiscal year.
Meanwhile, the NSIA has announced some N10.58bn in – crease in total comprehensive income from N15.77bn in 2014 to N26.35bn in 2015.
Total assets increased by 20 percent from N177.83bn in 2014 to N213.67bn in 2015 while investment income grew by 47 per cent from N3.94bn in 2014 to N5.82bn.
Announcing the Authority’s audited results for 2015, which reflects the Fund’s fiscal position and investment activities for the year, Orji described 2015 as a very challenging year, indicating that 2016, as widely reported will remain challenging.
He said the NSIA operating environment was character – ized by high volatility and global market uncertainties as currency turmoil, dwindling oil prices and decelerating growth across markets created a difficult investment environment for the Authority, managers of the Nigeria’s $1..25 billion Sovereign Wealth Fund (SWF).
Orji however, stressed that despite all these challenges, the fund continues to show appre – ciable resilience owing to the fact that the management team had in the past taken steps to invest in various private equity investment funds.
This provided an avenue for the fund to tap into highgrowth sectors across SubSaharan Africa, he noted.
“2015 was a difficult year but the NSIA managed to pro – tect its capital in a harsh and volatile market environment where equities and binds in many leading economies suffered declines,” Orji stated.
“In particular, the decision to invest in Alternative Asset Classes proved beneficial in 2015 as this ensured that our portfolio was relatively im – mune from the market forces while traditional asset classes suffered significant declines.”
Orji was optimist that the NSIA shareholders which are the Federal and State Govern ments would get their first dividend by 2018 if the fund continues to make profit as it had done in the last three years.
“The law setting the NSIA stipulates that if we make re – turns consistently for five years after commencing operations, then we will have to pay divi – dend.
“So going by this, if we con – tinue along this line of profit – ability, then by 2018, we will be paying our first dividend to our shareholders,” he said. Speaking on the outlook for the 2016 fiscal year, he said the additional $250m capital which was approved for alloca – tion to the agency last year by the government had been re – ceived and would be invested this year.
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