Nigeria’s Securities and Exchange Commission has set 5:00 p.m. on the first working day after a trade as the cut-off for completing settlement in eligible equity and commodity transactions, warning brokers and dealers that funding shortfalls could trigger default action.
Key takeaways
- The directive applies to capital-market operators across Nigeria.
- It is part of the country’s T+1 settlement regime, introduced on June 1, 2016.
- Transactions covered by the framework must be settled one business day after execution.
- Accounts without enough money to meet obligations will be handled under the CSCS Default Management Procedure.
Settlement deadline clarified
The SEC announced the requirement in a Wednesday circular addressed to all operators in Nigeria’s capital market. The specified deadline is 5:00 p.m. on T+1, meaning the first business day following the trading date.
The Commission said the clarification supports the continued operation of the T+1 settlement cycle. Under that arrangement, eligible securities trades are completed one working day after they are carried out, reducing the time between execution and final settlement.
Consequences of insufficient funds
The regulator said every transaction covered by the rule must be fully funded by the stated T+1 deadline. A broker or dealer whose trading account does not contain sufficient funds to discharge its settlement responsibilities will be placed under default procedures.
Such cases will be managed in accordance with the Default Management Procedure of the Central Securities Clearing System, or CSCS.
