SEC Overhauls Capital Rules For Nigerian Market Operators

The Nigerian capital market is bracing for sweeping changes after the Securities and Exchange Commission (SEC) unveiled a bold overhaul of minimum capital requirements for all regulated market operators. Announced in a circular on January 15, 2026, and reinforced by a public statement the following day, the new framework marks the most significant regulatory shift in the sector in over a decade, replacing the long-standing 2015 capital regime.

According to The Nation, the SEC’s revised rules target strengthening the financial backbone of the country’s capital market, improving resilience, and aligning with the evolving risk profiles of increasingly complex market activities. The Commission emphasized that these changes are designed to promote market stability, better protect investors, and foster the orderly development of emerging market segments, including digital assets and commodities.

Under the new regime, capital requirements have soared across the board. Brokerage firms executing client trades must now maintain a minimum capital base of ₦600 million, a threefold jump from the previous ₦200 million. Dealers focused on proprietary trading are required to hold at least ₦1 billion, up from ₦100 million. Firms that combine brokerage, trading, and advisory services—known as broker-dealers—face perhaps the steepest increase, with a new threshold of ₦2 billion, nearly seven times the prior requirement. These figures were confirmed in a January 16 circular and detailed by BusinessDay.

Fund and portfolio managers are also affected. Top-tier managers overseeing assets above ₦20 billion must now secure at least ₦5 billion in capital, a dramatic rise from ₦150 million. Limited-scope managers are expected to meet a ₦2 billion threshold. For private equity and venture capital funds, the new requirements stand at ₦500 million and ₦200 million, respectively. The SEC has also introduced a new rule: any firm managing assets above ₦100 billion must now maintain at least 10% of assets under management as capital.

Other market operators face similar hikes. Issuing houses providing full underwriting services must now hold ₦7 billion, while advisory-only issuing houses need at least ₦2 billion. Registrars are required to have ₦2.5 billion, rating agencies ₦500 million, trustees ₦2 billion, and underwriters ₦5 billion. Even individual investment advisers—historically low-capital operations—must now meet a ₦10 million threshold.

Infrastructure players and exchanges have not been left out. Composite securities exchanges and central counterparties must each maintain ₦10 billion, while clearinghouses are required to hold ₦5 billion. Non-composite exchanges, focusing on a single type of asset, have a minimum capital requirement of ₦5 billion. These measures, the SEC insists, are crucial for safeguarding systemic stability in Nigeria’s capital markets.

Financial technology (FinTech) operators and digital asset service providers are among the most affected by the new rules. Robo-advisers—traditionally considered low-risk—must now hold ₦100 million, up from ₦10 million. Digital asset exchanges and custodians each require ₦2 billion, while other digital asset platforms face thresholds ranging from ₦500 million to ₦1 billion. Tokenisation platforms and intermediaries, which have gained traction in recent years, are now formally regulated under the new capital framework.

Commodity market intermediaries and capital market consultants also face stiffer requirements. Warehousing operators must hold ₦500 million, and collateral management firms operating at national or international levels require the same. For capital market consultants, corporate entities must meet ₦25 million, individual consultants ₦2 million, and partnerships ₦10 million.

The SEC has set a compliance deadline of June 30, 2027, giving market operators an 18-month window to meet the new thresholds. The Commission has issued a stern warning that failure to comply within the stipulated timeline could attract regulatory sanctions, including suspension or withdrawal of registration. However, entities seeking transitional arrangements may apply for special consideration, and the SEC has promised further guidance on compliance processes.

In its official statement, the SEC asserted, “The revised capital regime is a necessary step to foster a more robust, competitive and globally aligned capital market in Nigeria.” The Commission argued that ensuring market participants have the financial strength to withstand shocks and deliver on their obligations would contribute to the long-term growth and sustainability of the financial ecosystem. The changes, the SEC said, reflect broader efforts to modernize Nigeria’s regulatory environment under the Investments and Securities Act, 2025, and position the capital market to meet the demands of more sophisticated financial activities.

The industry’s reaction has been swift. The Association of Securities Dealing Houses of Nigeria (ASHON), which represents all stockbroking houses in the country, responded on January 16 by seeking a downward review of the new minimum capital requirements. In a statement quoted by Premium Times, ASHON said, “As the umbrella trade association representing all Stockbroking Houses in Nigeria, the Association of Securities Dealing Houses of Nigeria (ASHON) we want to say that we cannot run away from this capitalization review.” The association clarified that it is not challenging the SEC’s directive but aims to facilitate a smooth, orderly, and considerate recapitalisation process for its members.

ASHON further noted that it has begun consultations and engagements to ensure members are well-positioned to comply before the deadline, while also mobilizing for a downward review of the new capitalization. The association pledged to continue engaging with stakeholders and to keep its members informed of further developments, urging cooperation and patience during the process.

The new rules are expected to drive consolidation across the sector. Smaller operators, who may struggle to meet the steep thresholds, could be forced to downsize, merge, or exit the market altogether. Some may seek foreign investment or strategic partnerships to shore up their capital base. While this may reduce the number of participants, the SEC and industry analysts argue that it will ultimately increase the overall quality, governance, and resilience of those that remain.

For investors, these reforms translate to stronger protection. Firms with higher capital buffers are better positioned to withstand market shocks and safeguard client assets. The SEC’s goal, as articulated in its public communications, is clear: fewer firms, but with stronger governance and balance sheets.

As the June 2027 deadline approaches, Nigeria’s capital market is poised for a period of adjustment. The coming months will likely see a flurry of activity as firms scramble to raise capital, seek partnerships, or lobby for regulatory adjustments. The SEC’s reforms, while controversial in some quarters, signal a decisive step toward a more stable, transparent, and globally competitive Nigerian capital market.

With the clock ticking toward full implementation, the industry must now adapt to a new normal—one defined by higher standards, greater resilience, and the promise of a safer investment environment for all participants.