Uche Orji: SWF grows

Total assets of Nigeria’s sovereign wealth fund grew to 213.67 billion naira ($1.07 billion) in 2015, up by 20 percent compared with the previous year, its managing director said on Friday.

The agency recorded a comprehensive income increase of N26.3billion in 2015, compared to N15. 7 billion recorded in 2014.

Orji stated this on Friday in Abuja while addressing journalists on the audited financial results of NSIA for the 2015 financial year.

According to him, investment income of the authority stands at N 5. 8 billion, while its total assets which grew by 20 per cent also stands at N213. 6 billion at the end of 2015.

Nigeria  established the Sovereign Investment Authority (SIA) in 2011 with $1 billion of seed capital in an effort to manage oil export revenues.

President Muhammadu Buhari took office last May and has prioritised cracking down on corruption and mismanagement, particularly in the oil sector, which has deepened an economic crisis exacerbated by falling crude prices.

“Total assets recorded a growth of 20 percent to 213.66 billion naira at year end,” the fund’s managing director, Uche Orji, said in a report issued on Friday.

The total assets were up from 177.84 billion naira ($894.57 million) the previous year. And investment income grew by 47 percent to close at 5.8 billion naira ($29.18 million).

The report said 2015 was a “difficult year” but the SIA had “managed to protect its capital in a harsh and volatile market environment”.

The fund is divided into three parts, a ‘Stabilisation Fund’ to act as a buffer against economic turbulence, an Infrastructure Fund and a Future Generations fund.

In November officials announced that $250 million from liquid natural gas export proceeds would be injected into the wealth fund.

Orji said this additional capital was received in February 2016 and will be invested within the new fiscal year.

He said it would be invested using the existing deployment ratio of 40 percent in Infrastructure Fund, 40 percent in Future Generations Fund and 20 percent in Stabilisation Fund.

It is the first fresh money since the previous administration injected $1 billion in 2014.

Orji said that in 2015, the NSIA deepened investment in Nigeria-based private equity and fund managers.

”Private equities are people who seek opportunities in private markets and invest over time and get returns.

”This has been one of the most successful asset classes of investment in the world, the difference, however, is that they invest over three to four years and start giving returns.

”We believe it is one of those things that will help the Nigerian capital market develop significantly and will earn us significant amount of return.

”So, we unbounded four Nigeria-based portfolio managers in private equity, bringing our total commitments of private equity to 24,” he said.

The managing director said that one of the key things NSIA embarked upon in 2015 was the framework of co-investments to bring other investors to partner the authority to invest in projects.

‘’The first we arrived at is on real estate and we expect that it will be operational in the second half of this year.’’

He said that if successful, it would be used as strategy for other segments like power, agriculture and health care to help channel investments from outside into the country.

He identified the key sectors for infrastructure investment of the NSIA as agriculture, health care, power and real estate.