The Nigerian Sovereign Investment Authority (NSIA) managers of the nation’s sovereign fund, has pledged to release funds as part of its equity stake in the second Niger bridge, even as it revealed that it earned N2.5 billion in profits at the end of the half year 2014 period.
“We are in the process of paying money to Julius Berger as part of early works for the bridge,” said Uche Orji, the managing director, NSIA.
“The SWF made net profits of N2.5 billion as at June, 2014, while our expenses were flattish to down,” Orji said.
The profits are 370 percent higher than the N525 million profits realised by the NSIA in the 15 month period to December 2013.
Half of the profits are realised gains, while the rest are unrealised gains from the investment portfolio, based on the market’s performance, according to Orji.
The Julius Berger-NSIA Motorways Investment Company (JB-NMIC) Consortium is the preferred bidder for the development of the Second River Niger Bridge Project.
The NSIA invests with three funds which are the Future Generations Fund to which it allocates 40 percent of its assets; Nigerian Infrastructure Fund (40 percent) and Stabilisation Fund (20 percent).
The Nigeria Infrastructure Fund (NIF) focuses entirely on domestic investments in selected infrastructure sectors.
“The Nigeria Infrastructure Fund (NIF), NSIA is focused on investing in critical infrastructure that would attract and support Foreign Direct Investment, promote economic diversification and enhance growth,” The NSIA said in a statement in its 2013 FY financial report.
The NSIA has funded three commitments in the infrastructure fund namely: the Nigeria Mortgage Refinancing Company, in which it holds 22.7 per cent stake, fund for agriculture finance and the second Niger Bridge.
Speaking on the future generations funds (FGF), Orji said four hedge fund managers were allocated 25 per cent of the agency’s assets, across various strategies including global, macro and long-short equities.
The FGF has an investment horizon of about 20 years.
Orji said the near term view is positive for the market in 2014, with 80 percent of the FGF asset allocation in growth assets, 15 percent in inflation hedge assets and 5 percent in deflation hedge assets.
Within the growth asset category, the NSIA has allocated 25 percent to equities, split 15 percent to emerging markets and 10 percent to developed markets.
‘‘We have also allocated 25 percent to absolute return funds, another 25 percent to private equity funds and 5 percent to other diversifiers. Within the inflation protection assets, we have allocated 10 percent to real assets and 5 percent to commodities. And finally we have retained 5 percent in cash as deflation protection for the portfolio,’’ he said.
The Private Equity (PE) fund would also be fully allocated by December, according to Orji.
While there was no direct exposure to Nigerian equities for the period, there was a little indirect exposure through investments in Emerging Markets (EM) fund managers with Nigerian assets in their portfolios.
‘’We are not considering direct exposure to Nigerian equities for now,’’ Orji said.
