Global index provider FTSE Russell is set to proceed with the reclassification of Nigeria from “Unclassified” to “Frontier Market” status, potentially ending months of uncertainty over the country’s return to the index category. According to a report by BusinessDay, FTSE Russell is expected to formally announce the decision later this……
Global index provider FTSE Russell is set to proceed with the reclassification of Nigeria from “Unclassified” to “Frontier Market” status, potentially ending months of uncertainty over the country’s return to the index category.
According to a report by BusinessDay, FTSE Russell is expected to formally announce the decision later this week, paving the way for Nigeria’s planned re-entry into the Frontier Market classification.
The development means Nigeria’s reclassification, initially scheduled to take effect in September 2026, is expected to go ahead despite concerns over the country’s transition from a T+2 to a T+1 settlement cycle.
FTSE Russell had in June placed the reclassification under “further review” after Nigeria’s capital market adopted the shorter settlement cycle on June 1, 2026.
The index provider had raised concerns that the T+1 system could effectively require international institutional investors to prefund equity transactions in Nigeria.
FTSE Russell treats a mandatory prefunding requirement as a negative factor under its “Settlement Cycle (DvP)” criterion, one of five core Quality of Markets criteria considered in determining Frontier Market status.
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However, the Securities and Exchange Commission (SEC) subsequently clarified that foreign portfolio investors are not required to prefund their accounts when trading in the Nigerian capital market.
The SEC explained that transactions settled through the Central Securities Clearing System are completed at 5:00 p.m. on T+1 and continue to operate under the standard Delivery versus Payment framework.
Nigeria was initially reclassified from “Unclassified” to “Frontier Market” status following FTSE Russell’s March 2026 interim review, with the implementation scheduled to begin at the opening of trading on September 21, 2026.
The country had been removed from FTSE Russell’s Frontier Market indices in September 2023 following persistent challenges faced by international investors in repatriating capital and accessing foreign exchange.
FTSE Russell later acknowledged improvements in Nigeria’s foreign exchange market, including the clearance of outstanding FX transaction queues, before approving the country’s return to Frontier Market status earlier this year.
The global index provider is expected to release further details on its decision by the end of August 2026.
