Nigeria’s T+1 Settlement Reform and FTSE Russell’s Pushback

T+1 settlement refers to trade date plus one business day.
If you buy or sell a stock on Monday, the transaction settles on Tuesday: money moves, and ownership is finalized.

This reform reduces market and counterparty risk, improves efficiency, and aligns Nigeria with global best practice. Major markets such as the US, Canada, Mexico, India, and China have already transitioned to T+1.

Surprisingly, European markets remain on T+2 and plan their transition only in October 2027.

Why FTSE Russell Is Holding Back

Nigeria’s move to T+1 has triggered resistance from FTSE Russell, which is delaying reclassification of Nigeria’s market. According to Akinbamidele Akintola (Otunba Delz), the index provider wants Nigeria to create separate settlement rules: one for domestic investors and another for foreign portfolio investors.

Their concern is FX settlement risk. They want to avoid carrying that risk for 24 hours, preferring Nigeria to hedge it for them. In essence, they want profits without exposure.

Local vs Foreign Investor Treatment

Under T+1, local investors must pre‑fund trades. Foreign investors, however, want exemptions that allow them to continue “carry trade” practices—borrowing naira against FX deposits, inflating prices, and exiting quickly with profits.

This pump‑and‑dump strategy destabilizes the market. Nigeria’s recent sharp corrections and pressure on the naira may partly reflect such trading.

FTSE Russell’s hesitation reflects foreign investors’ desire to avoid risk while reaping profits. But reforms must serve Nigeria’s long‑term stability, not external interests.

Nigeria Should Resist This Imposition.

Courting foreign portfolio investors should not come at Nigeria’s expense. They enter markets only when profitable; they are not doing Nigeria…