Nigeria’s capital market recorded more than N753 billion in commercial paper (CP) issuances between April and October 2025, underlining the growing importance of short-term debt instruments in corporate financing.
This also signals renewed investor confidence in the country’s regulatory and macroeconomic direction.
The Securities and Exchange Commission (SEC), which disclosed the figures, said the strong issuance activity reflected deepening liquidity in the market, sustained demand from investors, and the impact of reforms aimed at strengthening market transparency and efficiency.
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In a statement released on Sunday, December 28, SEC Director-General Emomotimi Agama described the commercial paper segment as one of the most active areas of the capital market during the period, providing critical funding support to companies across key sectors of the economy.
According to Agama, firms in manufacturing, agriculture, energy, and other strategic industries tapped the CP market extensively to meet short-term working capital needs, as tighter bank credit conditions and elevated interest rates pushed corporates to seek alternative funding channels.
“Commercial paper issuance remained vibrant, with over N753 billion raised to support short-term funding needs across diverse sectors,” he said, adding that the scale and frequency of the issuances point to growing sophistication among both issuers and investors.
Beyond commercial paper, the SEC said the broader debt market also recorded landmark transactions that highlighted investors’ increasing willingness to back longer-dated and thematic instruments. Agama cited the N500 billion Climate Funding Special Purpose Vehicle and the N200 billion Elektron Finance bond issuance as examples of deals that underscore rising interest in infrastructure-linked and sustainable finance products.
“These figures are not just numbers; they represent confidence in our regulatory framework and the resilience of our market architecture,” the SEC chief said, noting that the transactions reflect a shift toward more diversified capital-raising structures.
Agama explained that the strong CP performance formed part of a wider set of capital-raising activities approved by the Commission across debt, equity, and hybrid instruments between April and October. He said the market showed “remarkable depth and adaptability” during the period, reinforcing its role as a key channel for mobilizing funds to support economic expansion.
The SEC also pointed to supportive macroeconomic developments that helped shore up investor sentiment. Nigeria’s recent sovereign credit rating upgrade and its removal from the Financial Action Task Force (FATF) grey list were cited as major confidence boosters, particularly for foreign portfolio investors who have historically been cautious about regulatory and compliance risks.
“These achievements signal renewed confidence in our economy,” Agama said. “They will attract greater investment and enhance capital inflows.”
On monetary conditions, the SEC boss said easing inflationary pressures has created room for innovation across capital market products, while urging market participants to move decisively from policy discussions to practical execution.
“The time for passive observation is over. Our collective responsibility is to activate opportunities and position the market as an engine of inclusive growth,” he said.
Agama also addressed recent volatility in the equities market. In November, the Nigerian Exchange lost about N6.54 trillion in market capitalization, a sharp downturn he attributed to profit-taking ahead of the proposed 30% capital gains tax, weak sentiment around banking stocks, and broader global uncertainties. He said the market has since staged a rebound, helped by policy assurances and renewed investor confidence.
A key structural reform highlighted by the SEC is the migration of the equities settlement cycle from T+3 to T+2, a change Agama described as a landmark step that has improved liquidity and reduced counterparty risk. He said plans are already in motion to move to T+1 and, ultimately, same-day settlement under a T+0 framework.
Commercial paper, which is a short-term unsecured debt instrument typically issued for maturities of 270 days or less, has become increasingly attractive to both issuers and investors. For companies, it offers faster access to funding at competitive rates, while investors benefit from relatively high yields in a regulated environment.
The strong CP issuance comes as Nigeria’s capital market closes 2025 at a historic high. Total market capitalization stood at N149.88 trillion as of December 24, just shy of the N150 trillion mark for the first time. The growth has been driven by robust performance across equities, bonds, and exchange-traded products, supported by regulatory reforms, high domestic investor participation, and solid corporate actions.
Equities accounted for N97.89 trillion, or about 65% of total market value, while bonds contributed N51.55 trillion and ETPs added N43.20 billion. The NGX All-Share Index delivered a 49.17% year-to-date gain, placing the Nigerian Exchange among Africa’s top-performing bourses in 2025. Market turnover more than doubled over the year, driven largely by domestic retail and institutional investors seeking higher returns in a tight monetary environment.
Taken together, the SEC said the surge in commercial paper issuance, major debt deals, improving macroeconomic indicators, and ongoing market infrastructure reforms are strengthening Nigeria’s positioning as one of Africa’s most attractive investment destinations, with the capital market playing an increasingly central role in financing growth.