Nigeria’s Securities and Exchange Commission (SEC) has issued a directive requiring all capital market operators to submit board-approved plans for either recapitalization or license downgrade within six weeks after the June 30, 2027 compliance deadline.
Under the updated capital guidelines released on March 18, 2026, operators must present detailed implementation strategies covering their current capital position, required thresholds, funding approach, risk factors, and governance structure. The rule applies broadly to brokers, dealers, fund managers, custodians, exchanges, and digital asset firms. Failure to submit credible plans could attract sanctions, including license restrictions and regulatory delays, in line with the Investments and Securities Act 2025. Additionally, pending applications older than 12 months will lapse and require fresh submissions.
The directive follows a major increase in minimum capital requirements across the industry. Broker-dealers must now maintain ₦2 billion (up from ₦300 million), dealers ₦1 billion (from ₦100 million), registrars ₦2.5 billion (from ₦150 million), while underwriters and clearing firms require ₦5 billion, and composite exchanges ₦10 billion.
The Commission stressed that the recapitalization exercise is a long-term reform aimed at strengthening market stability and aligning Nigeria’s capital market with global standards. It also introduced stricter rules on what qualifies as regulatory capital, limiting it to high-quality, loss-absorbing assets such as paid-up shares and retained earnings, while excluding items like unrealized gains, borrowed funds, and client assets to ensure genuine financial strength.
