Nigeria Gets Real About Bond Prices With New SEC Rules
What’s going on here?
Nigeria’s regulators are overhauling the local bond market, ordering all bond funds to adopt mark-to-market pricing by 2027—a change that replaces old valuation habits with full price transparency.
What does this mean?
Up to now, most Nigerian bond funds valued holdings using amortized cost, so day-to-day market swings rarely showed up in fund values. The Securities and Exchange Commission (SEC) is changing that, requiring fund managers to switch to mark-to-market (MTM) pricing, which means reflecting real-time prices. The update brings the Nigerian fixed income market in line with global standards and exposes investors to previously hidden price volatility from interest rate and credit shifts. Industry leaders point out that this will make both losses and gains more evident, likely shifting how investors think about risk. The SEC is offering a gradual phase-in—letting old bonds use a 50:50 mix at first—but any new investments must be marked to market from the get-go.
Why should I care?
For markets: Transparency brings new energy—and new swings.
This transition could boost liquidity and sharpen price discovery in Nigeria’s bond market, potentially attracting investors looking for honest valuations and global standards. Increased transparency may heat up volatility, but it also helps open the door to international capital, positioning Nigerian bonds as a more attractive choice for foreign managers. All this comes as wider financial reforms under President Tinubu aim to modernize Nigeria’s markets.
The bigger picture: Nigeria steps onto the global finance stage.
The timing follows Nigeria’s broader push to modernize—tightening bond accounting right as the country revamps currency rules and phases out fuel subsidies. By raising standards, regulators hope to make Nigerian markets more resilient and appealing to overseas investors. As transparency grows, Nigeria could unlock new waves of international investment and strengthen its financial sector for future growth.
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