Menu

Nigeria will regain its FTSE Frontier Market status in September 2026, after FTSE Russell confirmed that the country’s transition to a T+1 settlement cycle has not created material operational or funding challenges for international investors. The upgrade, approved by the FTSE Russell Index Governance Board, reverses Nigeria’s temporary “unclassified” designation and marks a significant step toward restoring the country’s visibility in global equity benchmarks.

FTSE Russell said the decision followed additional engagement with Nigerian market authorities and feedback from its Equity Country Classification Advisory Committee, which reported no settlement or prefunding issues since the adoption of T+1. The index provider had paused Nigeria’s reclassification earlier in the year over concerns that the shorter settlement cycle could force foreign investors to prefund trades, given the complexities of cross border FX conversions and approvals. Nigerian market operators, including the Chartered Institute of Stockbrokers, maintained that T+1 did not impose prefunding requirements.

The reinstatement reflects broader improvements in market infrastructure and accessibility, supported by enhancements to the Nigerian Exchange (NGX) trading and settlement systems. FTSE Russell’s Quality of Markets assessment recorded “Pass” ratings for regulatory oversight, capital repatriation, brokerage competitiveness, tax framework and settlement efficiency. The review also identified areas needing further development, including FX market depth, transaction cost efficiency, derivatives availability and certain custody and clearing mechanisms.

Temi Popoola, Group Managing Director/CEO of NGX Group, said the reclassification underscores the progress made in strengthening market infrastructure and transparency, adding that continued reforms will be essential to sustain momentum toward higher market classifications.

Nigeria’s return to the Frontier Market universe is expected to improve its profile among global asset managers and index tracking funds, potentially unlocking new foreign portfolio inflows and reinforcing efforts to deepen liquidity and investor participation in the capital market.