FTSE Russell’s reclassification for Nigeria signals renewed opportunity for global investors – NGX

The Nigerian Exchange Group (NGX) says the decision by FTSE Russell to restore Nigeria to frontier market status signals renewed opportunity for international investors.

On April 8, the FTSE, a global provider of stock market indices and data analytics, said Nigeria will be reclassified from “unclassified” to “frontier market” status in September 2026 after three years of downgrade.

Reacting to the development in a statement on Thursday, the NGX said the reclassification marks a significant milestone in Nigeria’s reintegration into global investment indices and will boost investor confidence and inflows.

The exchange said the decision was approved by FTSE Russell’s index governance board following recommendations from its equity country classification advisory committee and policy advisory board.

The organisation said the reclassification, expected to take effect from September 2026, was announced as part of the March 2026 interim review.

According to the exchange, the decision reflects sustained improvements in Nigeria’s market infrastructure, accessibility, and overall investability, driven largely by enhancements to its trading platform.

The NGX said improvements in trading systems, settlement processes, and transparency have contributed to a more efficient and accessible market environment for both domestic and international investors.

“According to the FTSE Quality of Markets assessment, Nigeria recorded “Pass” ratings across several core criteria, including regulatory oversight, capital repatriation, brokerage competitiveness, tax framework, and settlement efficiency, with a T+2 settlement cycle in operation. These gains reflect deliberate efforts to align market operations with global standards and improve the investor experience,” the bourse said.

“While acknowledging this progress, the review also highlighted areas for further development, including foreign exchange market depth, transaction cost efficiency, derivatives market availability, and certain custody and clearing mechanisms.

“Addressing these gaps will require continued coordination across regulators, market operators, and the broader financial ecosystem.”

However, NGX said the frontier market designation is expected to boost Nigeria’s visibility among global asset managers and index-tracking funds, potentially unlocking new capital inflows and broadening the market.

Commenting on the development, Temi Popoola, group managing director and chief executive officer of NGX, said the reclassification reflects deliberate efforts to strengthen the capital market ecosystem.

“This milestone reflects the strength of collaboration across Nigeria’s capital market ecosystem, but importantly, the deliberate efforts to strengthen the underlying market infrastructure that supports efficient trading, transparency, and investor access,” Popoola said.

He said the company would continue to work with regulators and stakeholders to deepen reforms, address identified gaps, and sustain momentum towards higher market classifications. (TheCable)