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Kayode Tokede

A wave of criticism from domestic stockbrokers has followed FTSE Russell’s sudden pause on Nigeria’s return to the Frontier Market universe.

Upgraded just months ago in March with an effective date set for September, the country’s progress was abruptly frozen over its shift to a shorter T+1 settlement framework.

Market operators are now knocking the global index provider, calling the delay a setback that misreads a progressive operational upgrade as a market risk.

Commenting on the role of market infrastructure and operators in strengthening Nigeria’s capital market, Chairman, Association of Securities Dealing Houses of Nigeria (ASHON), Sehinde Adenagbe, said: “A strong capital market is built on the effectiveness of its ecosystem, the ability of market participants, institutions and infrastructure providers to work together in creating a seamless environment for capital formation and investment.

“The success of Nigeria’s recent banking sector recapitalisation exercise is a reflection of the growing capacity of the market to support large-scale transactions and connect businesses with the capital required for growth. The participation of institutional and domestic investors throughout this process further demonstrates the increasing confidence in the Nigerian capital market and the important role played by market operators in facilitating access, ensuring efficiency, and supporting investor participation.”

He added: “The depth and resilience of any market are shaped by several factors, including accessibility, transparency, strong corporate governance, effective regulation, and the professionalism of its operators. These foundations have continued to support the growth and credibility of Nigeria’s capital market. 

“As the market continues to evolve, sustained focus on improving market efficiency, strengthening investor confidence, and expanding opportunities for participation will remain critical to building a globally competitive capital market. Nigeria’s recent capital formation activities demonstrate the potential and capacity of the market to support economic development.”

Also commenting on the broader assessment of market development, Vice-President of Highcap Securities Limited, David Adonri, said: “Capital market quality cannot be assessed through a single operational criterion in isolation. The broader picture is equally important, market liquidity, capital formation, regulatory oversight, corporate governance, transparency, technological infrastructure and investor participation.

“Nigeria has made measurable progress across these dimensions. Recent reforms have strengthened market resilience, enhanced regulatory coordination and demonstrated the market’s ability to finance large-scale economic activity. Classification frameworks should therefore evaluate the market as a complete ecosystem rather than allowing one implementation issue to outweigh substantial structural improvements.”

Speaking on the growing role of domestic participation in Nigeria’s capital market, the Chief Executive Officer, Wyoming Capital & Partners, Tajudeen Olayinka, said: “One of the most significant developments in Nigeria’s capital market has been the increasing strength of domestic institutional and retail investors.

“The banking recapitalisation exercise showed that Nigerian investors were able to provide substantial long-term capital, reducing excessive dependence on foreign portfolio flows. A deep domestic investor base is a hallmark of resilient capital markets because it provides stability during periods of global volatility. While international accessibility remains important, the depth and sophistication of domestic capital should also be recognised as an important measure of market maturity.”

Commenting on the significance of recent market infrastructure reforms, the Chief Operating Officer, InvestData Consulting Limited, Ambrose Omordion, said: “Every major infrastructure reform requires a period of adjustment. The relevant question is not whether operational processes are changing, but whether those changes produce a more efficient, transparent and resilient market over time.

“Nigeria’s transition to T+1 should be assessed in the context of its long-term benefits, lower settlement risk, faster capital recycling, improved market efficiency and closer alignment with international standards. These are the attributes that ultimately enhance investor confidence and contribute to sustainable capital market development.”