SEC targets African listings as Nigeria eyes ₦750tn capital market

Nigeria’s Securities and Exchange Commission (SEC) plans to introduce a framework to make it easier for companies across Africa to attract Nigerian investors as the country seeks to expand its capital market and strengthen its position as a regional financial hub.

According to a Bloomberg report published today, the proposed African depositary-receipt framework is intended to encourage more cross-border listings and attract companies and investors from other African countries to Nigeria’s capital market.

The initiative comes as the SEC pursues a broader plan to grow the market from about ₦250 trillion to ₦750 trillion over the next decade.

What are depositary receipts, and how would they work?

Depositary receipts are financial instruments that allow investors to gain exposure to shares in a company listed in another country without necessarily buying those shares directly on the foreign stock exchange.

For example, if a Kenyan company wanted to attract Nigerian investors, a depositary-receipt arrangement could allow those investors to buy receipts representing shares in the Kenyan business through an approved Nigerian market structure. The underlying shares would be held by a custodian, subject to the arrangement’s rules.

This could make cross-border investing easier by allowing investors to use familiar local market infrastructure rather than navigate a foreign stock exchange and its separate investment procedures.

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The idea is gaining attention across Africa. In October, the Egyptian Exchange began exploring a similar arrangement that could allow Egyptian investors to gain exposure to Dangote Group companies through Egyptian depositary receipts. The proposal was still under consideration.

Why the SEC wants more regional investors

Nigeria’s plan comes amid efforts to attract more capital into local businesses and expand the pool of investors available to companies seeking funding.

A larger investor base could help businesses raise money for expansion while giving Nigerians access to investment opportunities beyond their domestic market. It could also encourage more African companies to consider Nigeria when seeking capital.

However, making this work will require clear rules, cooperation between regulators and reliable arrangements for trading, custody and settlement across countries.

The need is evident in Africa’s fragmented investment landscape. Reuters reported in October that regulatory differences and limited access to foreign share offerings created hurdles for investors across the continent during Dangote Refinery’s initial public offering.

Uganda’s President Yoweri Museveni, President and Chief Executive Officer (CEO) of Dangote Group Aliko Dangote and Kenya’s President William Ruto attend a ceremony for the construction of an East African oil refinery in Lamu, Kenya, September 30, 2026. REUTERS/Monicah Mwang

The SEC’s proposed framework could help address some of these barriers, although its eventual impact will depend on how it is designed and implemented.

For now, the plan is a step towards connecting African capital markets. Whether it attracts significant new listings and investment will depend on the opportunities companies see in Nigeria and how easily investors can participate.

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