NSIA’s portfolio structured to provide positive long-term performance – MD

…Resilient against global economic headwinds

The Managing Director of the Nigeria Sovereign Investment Authority (NSIA) Aminu Umar-Sadiq has said that the NSIA’s portfolio has been structured to provide consistent, positive long-term performance.

He highlighted that the current global economic volatility due to tariff war would not have a negative impact on its operations.

Umar-Sadiq who gave the assurance on Wednesday in Abuja at the Authority’s 2024 Earnings presentation to journalists, stressed that the NSIA’s assets have been strategically allocated to insure the Authority from any eventualities.

According to him, the Authority has been the most resilient compared to its peers during downward market trends.

ALSO READ: Bauchi gov approves N872m PHC counterpart fund for 2025

He said, “For over a decade, NSIA successfully built and nurtured a diverse portfolio of subsidiaries across various sectors that contribute meaningfully to the national economy.

“Our approach is rooted in strong governance, robust risk management, and a strong operational focus.

“These have enabled us to optimize performance while adhering to our long-term strategic objectives”.

Documents made available by the NSIA show that its diversified earnings total assets increased by 96 percent to N4.42 trillion in December 2024 from N2.26 trillion in December 2023 reflecting steady asset growth aligned with equity strength.

This, it stated, was due to increased returns from associates and joint venture entities, net gains on collaterised securities, and net FX gains due to naira depreciation.

Umar-Sadiq said, “If you look at our strategic assets’ allocation on the stabilization and the future generations fund side, you will see it is defensive.

“We have allocations to private equity, we have allocations to hedge funds, and we have allocations to real estate, inflation-linked funds.

“And so, whilst on the upside, where the markets are roaring, we may not be fully optimizing, what it does is that it protects us on the downside, which is very, very important, because if you look at the mandate of our sovereign wealth fund, it is largely a savings mandate.

“So, irrespective of the on goings on the macro side, based on our strategic assets’ allocation on the stabilization and future generations fund side, you will see stable income growth.”

The NSIA Managing Director disclosed that the Authority received a total of $1.82 billion in net government contributions since it was established in 2011.

He explained that “these funds have been efficiently utilized by NSIA resulting in a Net Asset Value (NAV) of $2.84 billion as at December, 2024.”

NSIA share ownership shows that the Federal government has 46.5 percent, States 34.8 percent, Local Government Areas 18. 2 percent while the Federal Capital Territory (FCT) has 0.5 percent respectively.

In the 2024 Global Sovereign Wealth Funds (SWF) Governance, Sustainability and Resilience ranking, NSIA scored 90 percent, ranking second alongside Australia, Spain and Germany.

The MD said, “For over a decade, NSIA has successfully executed more than 150 Investments in a wide range of projects across the African Continent, demonstrating its commitment throughout the region”.

On infrastructure, Umar-Sadiq said Nigeria would need a significant amount of capital to bridge its infrastructure gap.

Experts say Nigeria needs $3 trillion investments over the next 30 years to bridge the country’s infrastructure gap.

He explained, “What we cannot deny is the modesty of our capital relative to that deficit. You know, over the last five years through PIDF, we worked very closely with the government to deliver Second Niger Bridge, the Lagos-Ibadan Expressway, and the portions of Abuja, Kaduna, Zaria and Kano. Each of those roads taken by them is almost the size of the Nigeria infrastructure fund.

“Our role is to find a way to make our modest capital go far and that is where a capital mobilization strategy is key.

“You know, because we have to find a way of doing the brain work, conceptualizing, developing, capitalizing, modestly, finding the right management team, setting the strategies, okay? And then having each of those platforms raises more money in order to execute upon those projects.

“If we decide to do large-scale direct projects, then we can’t go beyond two projects.

“The reason why we have a portfolio that we are all proud of now is because we have taken that time to essentially be project sponsors. You understand? Now, of course, it’s a very difficult terrain right now for a number of reasons.

“I think what is truly special about our infrastructure programme is that irrespective of whatever challenges that we face, we have the creativity and the inventiveness to pivot. And you have seen that in our 2024 results, you saw that in our 2023 results.”

In its audited 2024 financial statement, the NSIA witnessed a 59 percent increase in Total Comprehensive Income (TCI), which rose to ₦1.89 trillion in 2024, up from ₦1.18 trillion in 2023.

President Donald Trump of US started a tariff war when he slammed higher tariffs on other countries goods and services leading to reciprocal tariffs on the U.S leading to volatility in the global economy.

NSIA was created by an Act of the National Assembly signed into law by the President on 26th, May 2011.

 

NIGERIAN TRIBUNE