Nigeria’s Securities and Exchange Commission (SEC) has issued a firm directive to capital market operators, mandating the submission of board-approved recapitalisation or licence downgrade plans within six weeks, as part of sweeping regulatory reforms.
The requirement, outlined in revised minimum capital guidelines released on March 18, 2026, compels all operators to present detailed and actionable strategies ahead of the June 30, 2027 compliance deadline.
According to the Commission, “All CMOs are required to submit their recapitalization or downgrade plans within six weeks, with clear timelines and execution strategies.”
It added that each submission must clearly outline the operator’s current capital position, minimum capital requirements, funding strategy, risk considerations, and governance framework.
The SEC warned that failure to provide credible plans could attract regulatory sanctions, including licence restrictions and delays under the Investment and Securities Act (ISA) 2025 framework.
“Operators that fail to provide credible plans risk sanctions, including licence restrictions and regulatory delays under the ISA 2025 framework,” the Commission stated, noting that pending applications are not exempt. It further cautioned that applications older than 12 months would lapse and require fresh filings.
The directive applies across the entire capital market ecosystem, including brokers, dealers, fund managers, custodians, exchanges, and digital asset operators, underscoring the urgency of compliance.
The move follows the Commission’s recent decision to significantly raise minimum capital thresholds — one of the most far-reaching regulatory shifts in the sector in recent years.
Under the new structure, broker-dealers must now maintain a minimum capital base of N2 billion, up from N300 million, while dealers are required to meet N1 billion, compared to the previous N100 million benchmark.
Registrars will now require N2.5 billion, a sharp increase from N150 million, while underwriters and clearing firms are set at N5 billion. Composite exchanges face the highest threshold, with a new requirement of N10 billion.
The SEC emphasised that the recapitalisation drive is not a one-off exercise but a long-term structural reform designed to strengthen market resilience, enhance investor confidence, and align Nigeria’s capital market with global standards.
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