The Securities and Exchange Commission (SEC) has fixed 5:00 p.m. on the first business day after a transaction (T+1) as the settlement deadline for equities and commodities traded and settled through the Central Securities Clearing System (CSCS) in the capital market.
The Commission made the clarification in a circular issued on Wednesday to capital market operators and other market participants as part of the implementation of the T+1 settlement cycle in the Nigerian capital market.
Consequently, SEC said henceforth all transactions in the affected securities must be fully paid by 5:00 p.m. on the first business day after a transaction (T+1) to ensure compliance with the standard Delivery versus Payment (DvP) settlement procedure.
Where a broker/dealer’s trading account is not adequately funded to meet its settlement obligation within the prescribed period, the Commission warned that the default would be managed in line with the CSCS Default Management Procedure and the applicable transaction settlement guidelines of the relevant exchange.
Also, the Commission clarified that foreign portfolio investors were not required to pre-fund their accounts for trades in the Nigerian capital market.
However, the apex capital market regulator said capital market operators facilitating transactions on behalf of foreign portfolio investors must establish and maintain appropriate controls and processes to ensure timely funding and completion of settlements within the prescribed timeframe.
The Commission said the clarification followed earlier circulars on the implementation of the T+2 settlement cycle for equities transactions, issued on June 3, 2025, and the transition to the T+1 settlement cycle, issued on May 15, 2026.
“The T+1 cycle means that eligible securities transactions are settled one business day after the trade date, reducing the period between execution and final settlement,” the Commission explained.
The SEC said the transition represents a significant milestone in its efforts to build a more efficient, resilient and internationally aligned trading and post-trade environment.
The shorter settlement cycle, it added, would improve settlement efficiency, reduce counterparty risk, enhance liquidity and strengthen the competitiveness of the Nigerian capital market.
Besides, the Commission said the reforms would ultimately improve the attractiveness of the Nigerian market to both domestic and international investors.
