Senator Osita Izunaso has called for the continuous review of Nigeria’s capital market laws to ensure they remain responsive to emerging economic realities, technological innovation, and global investment trends. He said modernising the country’s regulatory framework is essential for attracting investment, strengthening market confidence, and supporting long-term economic growth.

Speaking on the importance of legislative reforms, Izunaso noted that the capital market is a critical driver of national development, providing businesses with access to long-term financing while creating wealth-building opportunities for investors. He stressed that outdated laws could limit market efficiency and reduce Nigeria’s competitiveness in the global financial system.

The senator explained that regular updates to capital market legislation would improve investor protection, enhance transparency, encourage innovation, and create a more resilient financial ecosystem. He also emphasised the need for regulations that can accommodate emerging financial technologies and evolving investment products.

According to him, a dynamic legal framework would help strengthen corporate governance, improve market integrity, and increase domestic and foreign investor confidence. He added that effective regulation is vital for sustaining economic expansion and supporting private sector development.

Financial experts have also advocated periodic reforms to Nigeria’s capital market laws, noting that evolving market conditions require regulatory systems that promote efficiency, accountability, and sustainable investment. They believe stronger legal and institutional frameworks will encourage greater participation in the capital market and deepen financial inclusion.

Stakeholders maintain that collaboration between lawmakers, regulators, financial institutions, and market operators will be essential to developing policies that support innovation while maintaining market stability and investor confidence.

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Domestic investors have contributed about 72 percent of the funds raised by Nigerian banks under the ongoing recapitalisation programme, according to the Central Bank of Nigeria (CBN).

The apex bank disclosed that financial institutions have continued to approach the capital market through various fundraising channels as they work to meet the March 31, 2026 deadline for the recapitalisation exercise.

As of February 2026, banks had raised a total of N4.05 trillion in verified and approved capital.

Domestic participation dominates fundraising

The Governor of the Central Bank of Nigeria, Olayemi Cardoso, said N2.90 trillion of the total funds raised came from domestic investors, while N1.15 trillion—representing about 28 percent—was sourced from foreign participation.

According to him, the figures demonstrate strong local investor participation in the capital strengthening exercise across the banking sector.

“In summary, 71.67 percent is domestic mobilisation and 28.33 percent is foreign participation. This balance represents a mix of domestic and foreign investment, signalling broad investor engagement and confidence in the sector,” Cardoso said.

Thirty banks meet capital requirements

The CBN also disclosed that many banks have already complied with the new minimum capital requirements as the deadline approaches.

In a statement issued by Hakama Sidi-Ali, the Acting Director of Corporate Communications at the CBN, the regulator said 30 banks had already met the new capital thresholds applicable to their licence categories.

According to the statement, 33 banks in total have raised additional capital through rights issues, initial public offerings and private placements as part of the recapitalisation programme.

“As of March 6, 2026, the recapitalisation exercise is progressing steadily. Thirty banks have met the new minimum capital requirements applicable to their respective licence authorisations,” the statement said.

The central bank added that the capital positions of the remaining banks are currently undergoing routine verification before final confirmation of compliance within the stipulated timeline.

Capital market activity rises

Industry observers say the recapitalisation drive has increased activity in Nigeria’s capital market since the programme was introduced.

Several banks have returned to the market to raise funds from existing shareholders and new investors through rights issues, public offers and private placements.

Market analysts believe that institutional investors such as pension funds, asset managers and other investment vehicles have played a key role in the strong domestic participation recorded so far.

Purpose of the recapitalisation programme

The CBN introduced the recapitalisation programme in 2024 to strengthen the resilience of Nigeria’s banking sector.

The policy requires banks to raise fresh capital to meet revised minimum thresholds based on their operating licence categories.

According to the regulator, the capital increase is designed to help banks absorb economic shocks more effectively and expand their ability to finance businesses and households.

Experts say stronger capital buffers will also improve financial system stability and increase banks’ capacity to support key sectors of the economy.

The programme represents one of the most significant capital strengthening exercises in Nigeria’s banking industry since the 2005 banking consolidation, which reduced the number of banks through mergers and acquisitions.

CBN maintains oversight

The central bank said the recapitalisation process is being closely monitored to ensure transparency, regulatory compliance and protection for depositors and investors.

“The Nigerian banking system remains stable and sound. The recapitalisation programme remains firmly on track and will further strengthen the capacity of the banking sector to support households, businesses and sustainable economic growth,” the CBN said.

The regulator added that it will continue to maintain supervisory engagement with financial institutions throughout the recapitalisation period to ensure full compliance with prudential standards.

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Accion Microfinance Bank Limited has successfully listed N2.02 billion Series 1 Commercial Paper (CP) on the FMDQ Securities Exchange, under its broader N5 billion Commercial Paper Programme.

The approval, granted by FMDQ’s Board Listings and Markets Committee, provides the bank with cost-efficient short-term funding to bolster its lending operations to micro-entrepreneurs and low-income earners across Nigeria.

The move reflects a growing trend among financial institutions to leverage Nigeria’s capital markets to access working capital amid rising borrowing costs in the commercial banking sector.

According to the official release, this Series 1 CP issuance was oversubscribed, signalling strong investor confidence in Accion MFB’s operational strategy and its commitment to financial inclusion.

“This CP issuance is not just about raising funds; it is about reinforcing our capacity to provide working capital, expand lending to small businesses, deepen financial innovation, and accelerate our digital transformation,” said Mr. Taiwo Joda, Managing Director of Accion MFB. He added that the proceeds will enable the bank to extend more credit to micro-entrepreneurs and small-scale businesses, a move that aligns with its mission to empower low-income communities.

Sponsored by FBNQuest Merchant Bank Limited, the issuance demonstrates the critical role merchant banks play in facilitating efficient access to capital. Mrs. Yetunde Falore, Head of Investment Banking at FBNQuest, stated: “We are proud to have guided this debut transaction. The oversubscription reflects investor confidence in Accion MFB and its financial inclusion mandate. By leveraging the capital market, institutions like Accion MFB can scale their impact effectively.”

In a parallel development, Payaza Africa Limited, a partner of MasterCard and Visa, is currently raising approximately N50 billion via Series 1 and 2 Commercial Papers under its N150 billion Commercial Paper Programme. Payaza has cumulatively raised over N70 billion through six CP series since its inception, with N32.53 billion fully repaid. The remaining balance is within the scheduled repayment timeline, reflecting disciplined financial management.

Experts highlight that CP issuances offer companies a cost-effective alternative to traditional bank loans, enabling them to meet operational and expansion needs while reducing reliance on high-interest borrowing. For microfinance banks like Accion, the proceeds enhance lending capacity to micro-entrepreneurs, contributing to broader financial inclusion and economic empowerment.

Financial analysts note that Nigeria’s commercial paper market is gaining traction as corporates increasingly seek agile, short-term financing solutions. The FMDQ Securities Exchange facilitates this by providing a regulated platform for CP issuances, attracting both institutional and retail investors. By participating in this market, firms can mobilize capital more efficiently than through conventional bank loans.

Accion MFB’s initiative is particularly significant given the challenges faced by small businesses in accessing affordable financing. Many micro-entrepreneurs and low-income earners are unable to meet collateral requirements for traditional loans, making microfinance institutions essential to bridging this gap. With the funds raised through the CP, Accion aims to scale its lending operations, supporting thousands of small businesses nationwide.

The issuance also underscores the synergy between technology-enabled capital markets and financial institutions seeking alternative funding sources. Digital platforms, streamlined processes, and transparent reporting mechanisms have made CPs an attractive avenue for both issuers and investors.

Looking ahead, analysts believe that increasing corporate participation in Nigeria’s CP market could improve liquidity, reduce borrowing costs, and enhance the capacity of microfinance banks to serve underserved communities. Such developments are expected to have a ripple effect, stimulating job creation, entrepreneurship, and economic growth at the grassroots level.

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