The Chairman of Financial Trust Company (FTC), Niyi Ajayi, has said that Nigeria’s long term economic growth will depend significantly on the success of ongoing reforms within the country’s capital market.
Speaking on the state of the Nigerian financial market, Ajayi noted that despite current economic challenges, the capital market continues to serve as an important channel for investment, wealth creation, and economic development.
According to him, strengthening market structures and improving investor confidence will be critical to unlocking the full potential of Nigeria’s economy.
Nigerian Exchange Shows Resilience
Ajayi described the performance of the Nigerian Exchange as encouraging, particularly given the economic pressures facing businesses and investors.
He noted that the market has remained resilient despite foreign exchange volatility, rising inflation, and a tight monetary policy environment.
The continued positive performance of the exchange, he said, reflects both the strength of many listed companies and growing investor recognition that Nigerian equities offer long term value.
He added that the market’s ability to maintain momentum in challenging conditions demonstrates increasing confidence in the country’s capital market.
Reforms Are Strengthening the Market
Ajayi said the Nigerian capital market has undergone significant improvements in recent years, making it more efficient and reliable for investors.
He pointed to stronger market infrastructure, improved settlement systems, and enhanced regulatory oversight as signs of progress.
According to him, the introduction of the T+1 settlement cycle and ongoing digitalisation efforts are expected to further improve market efficiency by speeding up transactions and enhancing the overall investor experience.
These reforms, he noted, are helping position Nigeria’s capital market for greater competitiveness both locally and internationally.
Liquidity Remains a Key Challenge
Despite the progress recorded, Ajayi identified market liquidity as one of the major issues that still require attention.
He explained that while large capitalised stocks continue to attract investor interest, many mid sized and small capitalised companies struggle with low trading activity.
This situation, he said, limits opportunities for some businesses to access capital and can reduce market participation.
To address the challenge, Ajayi called for broader involvement from both retail and institutional investors, arguing that increased participation would deepen market activity and support long term growth.
Capital Market Seen as Driver of Economic Development
Ajayi stressed that a vibrant capital market remains essential for Nigeria’s broader economic ambitions.
He noted that efficient capital markets help businesses raise funds, support entrepreneurship, create jobs, and attract domestic and foreign investment.
As Nigeria seeks sustainable economic growth, he believes continued reforms and stronger investor participation will play an important role in building a more robust and competitive financial system.
According to him, maintaining the momentum of current reforms could help position the Nigerian capital market as a stronger engine for economic expansion in the years ahead.
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