SEC Raises Minimum Capital Requirements for Market Operators

The Securities and Exchange Commission (SEC) has unveiled a sweeping revision of minimum capital requirements across all categories of capital market operators. It said this is to bolster resilience and ensure long-term stability in Nigeria’s capital market.

The new framework, issued under the Investments and Securities Act, 2025, applies to both core and non-core operators, including market infrastructure institutions, consultants, fintech firms, virtual asset service providers, and commodity market intermediaries.

According to a circular dated January 16, 2026, operators must comply by June 2027.

Major Changes in Capital Requirements

• Broker-Dealers: Raised from ₦300 million (2015 level) to ₦2 billion. Currently, 60% of Nigeria’s 100 active stockbroking firms fall into this category.
• Brokers: Tripled from ₦200 million to ₦600 million.
• Dealers: Increased tenfold from ₦100 million to ₦1 billion.
• Fund & Portfolio Managers:
  • Large managers (AuM above ₦20 billion): ₦5 billion (up from ₦150 million).
  • Mid-tier managers: ₦2 billion (up from ₦150 million).
  • Any manager with AuM above ₦100 billion must hold 10% of NAV/AuM as capital.
• Private Equity Firms: Minimum capital set at ₦500 million.
• Venture Capital Firms: Minimum capital set at ₦200 million.
• Issuing Houses (Non-Underwriting): Raised from ₦200 million to ₦2 billion.
• Issuing Houses (With Underwriting): Raised from ₦200 million to ₦7 billion.
• Digital Asset Exchanges & Custodians: Minimum capital set at ₦2 billion, signaling formal oversight of the sector.

Rationale Behind the Review

The SEC explained that the revision was prompted by evolving market dynamics, the growing complexity of financial products, and the need to align capital adequacy with the risk profile of regulated activities.

According to the Commission, the new thresholds are designed to enhance investor confidence by ensuring that market participants maintain sufficient financial buffers to meet their obligations even during periods of volatility.

The regulator emphasized that the revised regime will strengthen the financial soundness and operational resilience of operators, promote overall market stability, and mitigate systemic risks.

By aligning capital requirements with the scope, scale, and complexity of operators’ activities, the SEC aims to reduce vulnerabilities that could arise from undercapitalisation within the financial system

Analysts expect the new regime to trigger consolidation, as smaller operators may struggle to meet the steep requirements. Some may downscale, merge, or seek foreign investment and strategic partnerships to remain viable.

Aruna Kebira, MD/CEO of Globalview Capital Limited, welcomed the policy, noting its alignment with the federal government’s vision of a $1 trillion economy by 2030.

He said: “The banking sector has recapitalised, the insurance sector is undergoing recapitalisation, and now it is the turn of capital market operators. The new requirements will allow broker-dealers to expand into West African markets and trade other stocks outside Nigeria. Definitely, the policy will drive liquidity and deepen the capital market.”

Similarly, Sola Oni, CEO of Sofunx Investment & Communications, described the increase as a significant step toward capital market development.

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