Securities and Exchange Commission (SEC) has approved the transition to the T+1 settlement cycle for capital market transactions from June 1, 2026.

T+1 settlement is a financial rule requiring that securities trades (like stocks, bonds, and ETFs) be finalized and ownership transferred just one business day after the trade is executed. It replaces the older T+2 system, giving investors faster access to their funds and reducing overall market risk.

This is coming some months after Nigeria moved from the T+3 settlement cycle to the T+2 settlement cycle.

In a notice on Monday, the SEC, which is the apex capital market regulator in Nigeria, said it was authorising the new system to “promote an efficient, fair, and transparent capital market.”

Under the new arrangement, equities and commodities traded by investors at the market would be cleared and settled by the Central Securities Clearing System (CSCS) within one day.

The agency noted that the migration to a T+1 settlement cycle forms part of its ongoing market modernisation initiatives aimed at enhancing market efficiency and strengthening risk management. reducing counterparty exposure, improving liquidity, and aligning the Nigerian capital market with international standards and global best practices.

“Accordingly, all eligible trades executed in the Nigerian capital market shall settle one business day after the trade date (T+1),” a part of the statement noted.

It was stressed that “Friday, May 29, 2026, shall be the final trading day under the existing T+2 settlement cycle. Trades executed on Friday, May 29, 2026, and Monday, June 1, 2026, shall both settle on Tuesday, June 2, 2026. All trades executed from Monday, June 1, 2026, onward shall be subject to the T+1 settlement cycle.”

SEC tasked all capital market operators, securities exchanges, clearing and settlement infrastructure providers, custodians, registrars, issuers, and other relevant stakeholders to take all necessary measures to ensure full operational readiness and compliance with the new settlement framework.

“Market participants are expected to review and align their systems, processes, controls, and operational workflows ahead of the implementation date,” it further stated, promising to continue to engage stakeholders and monitor the implementation process to ensure an orderly and seamless transition.

The regulator said it remains committed to strengthening market integrity, enhancing investor confidence, and fostering the development of a modern. resilient and globally competitive Nigerian capital market.

Nigeria’s banking sector is losing an estimated N2.5 trillion in annual earnings due to the Central Bank of Nigeria’s high Cash Reserve Ratio (CRR) policy, according to a new report by Chapel Hill Denham.

The investment banking and research firm said the policy continues to impose significant constraints on bank profitability by requiring lenders to keep a large portion of customer deposits with the Central Bank without earning returns on them, effectively locking away funds that could otherwise support lending and income generation.

In its report titled “The Nigerian Banking Paradox: High Returns, Deep Discounts,” Chapel Hill Denham noted that although Nigerian banks rank among the highest return-on-equity performers in Africa, they remain undervalued compared to peers, largely due to regulatory constraints and macroeconomic uncertainty.

The firm identified the CRR regime as a key structural factor limiting the sector’s earnings potential, arguing that it reduces balance sheet efficiency and restricts credit creation to the real economy.

According to the report, banks are still required to pay interest on deposits while a significant portion of those funds remains sterilised at the apex bank.

Chapel Hill Denham stated that the current policy framework, which evolved in response to past financial sector instability and exchange rate pressures, may now be exerting a heavier drag on growth and profitability than originally intended.

“Our analysis reveals that Nigerian banks operate under a uniquely restrictive regulatory perimeter,” the report said, adding that the structure suppresses reported returns despite underlying profitability strength.

The report also compared Nigeria’s reserve requirements with other jurisdictions, noting that the country’s CRR remains significantly higher than several African and emerging markets.

While South Africa operates a 2.5 per cent CRR, Kenya maintains 4.25 per cent, Ghana 15 per cent, and Egypt 16 per cent, with Morocco reported to have reduced its reserve ratio to zero.

Analysts at the firm said a moderation of Nigeria’s CRR from 50 per cent to 30 per cent could release up to N8 trillion into the banking system and potentially boost annual pre-tax profits by about N800 billion.

They added that investors currently price Nigerian banks on the assumption that the tight monetary stance will persist, limiting valuation upside despite strong earnings performance.

At its February 2026 meeting, the Monetary Policy Committee of the Central Bank of Nigeria retained the CRR for Deposit Money Banks at 45 per cent, while Merchant Banks remained at 16 per cent, and public sector deposits outside the Treasury Single Account framework at 75 per cent, as part of efforts to sustain tight monetary conditions and manage liquidity pressures.

Lagos State Government has sanctioned 15 money lending firms over violations of operational guidelines and practices considered harmful to residents.

Ibrahim Layode, commissioner for Home Affairs, disclosed this during the 2026 Ministerial Press Briefing held in Ikeja.

Layode said the affected firms were penalised for engaging in sharp practices contrary to regulations guiding money lending operations in the state.

According to him, the government remains committed to enforcing strict compliance within the sector to curb fraudulent financial activities and protect Lagos residents from exploitation.

“The firms were sanctioned to ensure strict adherence to guidelines and to protect Lagosians from sharp practices by financial firms,” he said.

The commissioner described money lending as an important part of the economy, noting that it provides quick and accessible credit facilities to petty traders and small-scale business owners who often face difficulties obtaining loans from commercial banks due to stringent requirements.

“Moneylending business is one of the vital parts of the economy which allows people in the small-scale industry and petty traders to have stress-free access to quick loans to finance their businesses,” Layode said.

He explained that the Ministry of Home Affairs is responsible for processing applications, issuing and renewing licences for money lenders, as well as monitoring and supervising their operations across the state.

Layode added that the ministry regularly organises stakeholders’ forums to expose operators to global best practices and improve professionalism within the industry.

“We also conduct stakeholders’ forums for moneylender operators in order to bring them up to speed on the latest world best practices,” he said.

The commissioner further disclosed that the ministry collaborates with federal regulatory agencies, including the Federal Competition and Consumer Protection Commission (FCCPC) and the Special Control Unit Against Money Laundering (SCUML), to ensure compliance with financial and consumer protection regulations.

According to him, the ministry also profiles and monitors money lending firms to protect residents from fraudulent operators and dubious schemes.

“In addition, the Ministry registers, profiles and monitors the viability of such companies with a view to ensuring that while the money lenders are in business, the general public is also protected from being scammed by fraudulent people of questionable characters,” Layode said.

He noted that licensed money lenders have contributed significantly to the growth of micro and small businesses in Lagos by providing alternative sources of financing outside the conventional banking system.

“This partnership has greatly assisted small-scale business owners in Lagos to keep their petty businesses afloat without having to contend with high interest rates and clauses of the big commercial banks,” he added.

Layode revealed that between 2025 and 2026, the ministry received 112 new applications from money lending operators, while 214 existing licences were renewed.

On naturalisation and special immigrant status applications, the commissioner said the ministry, in collaboration with the Federal Ministry of Interior, continued to process applications from foreign nationals seeking Nigerian citizenship or permanent residency.

He explained that naturalisation is granted to foreigners who have resided continuously in Nigeria for at least 15 years and have established investment interests in their states of residence.

“The objective of the exercise is to grant citizenship rights to foreigners who have lived in the country continuously for fifteen years and above with investment interests in their states of residence,” he said.

Layode added that special immigrant status is granted to foreign nationals married to Nigerian citizens to promote integration and economic development.

According to him, applicants undergo screening and verification processes involving the Nigerian Immigration Service, Department of State Services, Nigeria Police, Lagos State Ministry of Justice and the Lagos State Internal Revenue Service.

He disclosed that 68 applications for naturalisation and special immigrant status were received during the period under review, while 20 applicants were screened and cross-examined for onward transmission to the Federal Ministry of Interior for final approval.