The Chairman of the Senate Committee on Capital Market and Institutions, Senator Osita Izunaso, has called for sustained legislative reforms to strengthen Nigeria’s capital market, arguing that a modern legal framework is critical to attracting long-term investment, boosting investor confidence, and accelerating economic growth.
Key Highlights
- Senate Committee Chairman Osita Izunaso called for sustained legislative reforms to strengthen Nigeria’s capital market.
- He said a modern legal framework is essential to attract long-term investment, boost investor confidence and drive economic growth.
- Izunaso highlighted the Investments and Securities Act, 2025, as a major financial sector reform that strengthens regulation and investor protection.
- The new Act repealed the 2007 Investments and Securities Act and expanded the powers of the Securities and Exchange Commission (SEC).
- The legislation provides legal recognition for digital assets and virtual asset service providers and introduces tougher measures against market abuse.
In a policy paper titled: “Legislative Leadership and Capital Market Development in Nigeria: Strengthening the Legal Framework for Economic Transformation,” Sen. Izunaso said the National Assembly must continue to modernise the country’s securities laws to keep pace with global financial developments and emerging technologies.
He argued that while regulators and market operators are responsible for day-to-day market activities, the long-term success of Nigeria’s capital market depends largely on the quality of its legal and institutional framework.
The senator identified the recently enacted Investments and Securities Act, 2025, as one of the country’s most significant financial sector reforms, saying the legislation provides a stronger regulatory foundation capable of supporting innovation, protecting investors, and making Nigeria’s capital market more competitive globally.
According to him, the new law repealed the Investments and Securities Act 2007 and introduced sweeping reforms, including stronger powers for the Securities and Exchange Commission (SEC), enhanced investor protection, legal recognition for digital assets and virtual asset service providers, a regulatory framework for financial market infrastructures, and tougher enforcement against market abuse.
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Sen. Izunaso added that the Act aligns Nigeria’s securities regulations with global standards set by the International Organization of Securities Commissions (IOSCO), a move he said would improve the country’s attractiveness to both local and foreign investors.
He noted that Nigeria’s ambition to build a resilient and diversified economy depends significantly on the ability of its capital market to mobilise domestic savings and attract international investment.
Beyond raising funds for governments and businesses, the senator said the capital market has become a major platform for infrastructure financing, enterprise expansion, pension fund investment, wealth creation and sustainable finance.
However, he warned that the market operates in an increasingly complex global financial environment shaped by financial technology, artificial intelligence, blockchain, digital assets, cybersecurity threats, climate finance and rising cross-border capital flows.
According to him, these developments require lawmakers to adopt forward-looking legislation capable of supporting innovation while safeguarding market integrity.
“The quality of legislative action has become a significant determinant of investor confidence, regulatory effectiveness, market transparency, and the capacity of the capital market to support national development,” Sen. Izunaso stated.
He stressed that the National Assembly’s responsibilities extend beyond passing laws to overseeing regulatory agencies, approving public expenditure, engaging stakeholders and ensuring continuous policy reforms that support market development.
The policy paper described the Securities and Exchange Commission as the apex regulator responsible for market supervision, investor protection, licensing intermediaries, registering securities and enforcing compliance.
It also commended reforms by the Nigerian Exchange Group (NGX Group) following its demutualisation, saying they have strengthened corporate governance, improved technology infrastructure, expanded product offerings and enhanced market competitiveness.
The Investments and Securities Tribunal was identified as a key institution for resolving capital market disputes, while the Central Bank of Nigeria, the Federal Ministry of Finance, the Corporate Affairs Commission, pension fund administrators, insurance companies and other institutional investors were recognised as important contributors to market stability.
Sen. Izunaso also highlighted the continued growth of pension assets under the contributory pension scheme, saying it has expanded the pool of long-term domestic capital available for government securities, corporate bonds, infrastructure projects and equity investments.
He described technological innovation as one of the capital market’s biggest achievements in recent years, citing electronic trading platforms, digital clearing and settlement systems, electronic public offerings and online investor services as reforms that have improved efficiency, lowered transaction costs and increased retail participation.
Despite these gains, the senator said the market still faces significant challenges, including low retail investor participation, poor financial literacy, inflation, exchange rate volatility, high interest rates, fiscal pressures, cybersecurity threats and the rapid emergence of digital investment platforms and virtual assets.
He warned that while financial technology has created new investment opportunities, it has also exposed investors and market operators to cybercrime, fraud, operational vulnerabilities and regulatory arbitrage.
