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NSIA grows assets to ₦2.22trn in FY 2023

. Attributes consecutive growth to effective risk management, resource allocation  

By Tochukwu Bliss, Abuja

The Nigeria Sovereign Investment Authority (NSIA), yesterday, announced a ₦2.22 trillion in Net Assets for the 2023 financial year, a 119% growth over the ₦1.02 trillion reported in December 2022.

The Authority in its audited results for the 2023 financial year, said the financial performance underscores the resilience of the NSIA’s investment strategy and the quality of its earnings, despite the challenging global macro-economic, and geo-political landscape.

Indeed, NSIA said it recorded 11 consecutive years of continuous positive earnings with a cumulative annual growth rate of 117.3%.

Other highlights of the 2023 FY Financial Results include:

  • Total Operating Income increased from ₦101.1 billion in the previous year to ₦1.18 trillion, inclusive of foreign exchange gains during the period. This significant rise was attributed to the positive performance of the equities and fixed-income portfolios, as well as the positive performance of NSIA’s infrastructure investments.
  • Total Comprehensive Income closed at ₦1.18 trillion for 2023, a growth of 1,122% relative to ₦96.96 billion in 2022.
  • Total Comprehensive Income (excluding foreign exchange gains) rose from ₦21.39 billion in the previous year to ₦164.69 billion, marking a 670% increase attributable to the Authority’s robust strategic asset allocation and adherence to best-in-class enterprise risk management processes.

Commenting on the result, NSIA’s Managing Director & Chief Executive Officer, Mr. Aminu Umar-Sadiq, said: “Our excellent results in 2023 and consistent positive performance over a decade offer further proof of our robust strategic asset allocation, proficient execution of our infrastructure initiatives as well as effective risk management processes.

“We remain firmly committed to catalysing positive socio-economic outcomes through critical infrastructure investments; strategic partnerships that expand our impact across pivotal sectors; and solutions that not only deliver our mandate but simultaneously uphold environmental stewardship.

“Looking ahead, we re-affirm our focus on creating shared prosperity for current and future generations of Nigerians.”

We remain firmly committed to catalysing positive socio-economic outcomes through critical infrastructure investments; strategic partnerships that expand our impact across pivotal sectors; and solutions that not only deliver our mandate but simultaneously uphold environmental stewardship.

Group resilience

Notwithstanding national and international headwinds, amid soaring inflation, Naira devaluation, and rates hike by Central Banks, NSIA Group’s net earnings closed at ₦1.18 trillion, (Incl. ₦1.02 trillion foreign exchange gains) FY2023, a 1,122% rise over the ₦96.96 billion, (Incl. ₦75.6 billion FX gains) recorded in 2022.

According to Authority, several key highlights contributed to the Group’s (Subsidiaries) performance during the 2023 financial year. These include:

  • Capital growth and preservation through focus on risk-adjusted returns – involving optimising asset allocation and utilisation, retaining a significant portion of the assets under management in foreign-denominated investments, diversifying the portfolio to mitigate risk, and maintaining a defensive investment strategy.
  • Core operating income growth – delivering increased yields from short to medium-term investments, growing third-party mandates and other fiduciary activities, and strengthening earnings resilience by diversifying revenue sources.
  • Infrastructure revenue growth by optimising existing impactful investment platforms to enhance efficiency and performance.
  • Well-diversified asset allocation techniques – resulting in improved risk-adjusted earnings from the Authority’s externally managed investments.
  • Cost optimisation – entails achieving operational efficiency, business process automation, budgetary and cost controls through technology enhancements and innovation.

Future outlook

Projecting a dynamic economic landscape for 2024, influenced by various factors such as the Russia-Ukraine, and the Israel-Hamas wars, NSIA believes these conflicts are likely to continue impacting trade dynamics and geopolitical stability.

In addition, the delayed resolution of the conflict might lead to more economic disruptions, humanitarian issues, and the potential for wider conflicts in the Middle East, leading to global disruptions in supply chains and trade.

Furthermore, Central Banks in developed economies are expected to maintain vigilant measures to combat inflation, which could affect global liquidity and interest rates, while the ongoing trend of deglobalisation may reshape supply chains, cross-border investments, and market access.

The fast-paced integration of AI technology across multiple sectors holds the potential to enhance global productivity while also disrupting traditional job structures.

Amidst these complexities, NSIA notes that “strategic planning, effective risk and governance frameworks, and adaptability will be important.”

It added that “ESG, Sustainability, and Climate finance will continue to play a vital role in our investment approach and strategy going forward,” while it continues to drive direct investments across its five core thematic areas.

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