Nigeria's T+1 Settlement Cycle Under FTSE Russell Review

FTSE Russell is reviewing Nigeria's plan to reclassify its market status following the Securities and Exchange Commission's (SEC) adoption of a T+1 settlement cycle. This reform is intended to attract foreign investment by aligning Nigeria's market with global standards.

However, it raises questions about operational challenges for international investors, particularly regarding foreign exchange and time zone differences. The T+1 cycle aims to reduce counterparty risk and improve liquidity by enabling quicker capital recycling.

Nigeria's capital market has successfully facilitated N3 trillion in capital raising for the banking sector, demonstrating resilience and depth in its local investment base. The transition to T+1 is not mandatory but aims to enhance the operational framework of Nigeria's post-trade ecosystem.

FTSE Russell's review is crucial for promoting transparency and maintaining investor confidence in Nigeria's regulatory market institutions.