The Securities and Exchange Commission (SEC) has clarified that fund and portfolio managers will be required to hold 0.1% of Assets Under Management (AUM) as regulatory capital and not 10% as initially stated in its January 16, 2026, circular.
This is according to reliable sources within the SEC who confirmed the correction to Naijaonpoint, following strong feedback from capital market operators.
SEC DG, Dr. Emomotimi Agama, is also expected to make this clarification official next week.
The clarification significantly lowers the capital burden for large asset managers and averts what industry leaders feared could destabilise the investment management landscape.
As part of its sweeping regulatory reforms, the SEC raised capital thresholds across virtually all capital market categories.
Other operators are also impacted: brokers (N600 million), dealers (N1 billion), broker-dealers (N2 billion), issuing houses (N2 billion–N7 billion depending on scope), and digital asset platforms (N2 billion). The implementation deadline is June 30, 2027.
While the SEC’s goals of strengthening investor protection and improving market resilience were broadly welcomed, operators described the capital hikes—especially for fund managers—as aggressive.
For even larger managers, the result is the same: low returns on capital, even with efficient operations. The report warns that this may discourage scale, encourage asset fragmentation, and ultimately weaken competition in the industry.
The SEC’s correction of the AUM capital rule from 10% to 0.1% is a critical course adjustment. It ensures the Commission’s objectives—market stability and investor protection—remain intact without jeopardising the viability of top-tier fund managers.
However, concerns remain over the flat N5 billion floor for Tier 1 managers, which some argue could still favour large, bank-affiliated firms and reduce diversity in the industry.
Calls for a more risk-sensitive, graduated model are expected to persist as implementation approaches.
Naijaonpoint understands that SEC Director-General, Dr. Emomotimi Agama, is expected to publicly clarify and confirm these changes during a stakeholder briefing scheduled for next week.
This follows days of consultations between the Commission and industry operators, and growing concerns about the potential impact of the original capital framework.
The SEC’s capital revision, announced in mid-January, is part of a broader regulatory reform that also includes the formal integration of fintechs, digital asset platforms, and new market infrastructure players into the capital market structure.
As implementation progresses toward the 2027 deadline, the focus will shift to how firms adapt and whether further regulatory fine-tuning will follow.
Editor’s note: This article has been updated to correct the assets under management (AUM) of Stanbic IBTC Asset Management, which is approximately N4 trillion and not N11 trillion as earlier stated. The initial figure inadvertently combined the AUM of Stanbic IBTC Asset Management with that of Stanbic IBTC Pensions.
Editor’s note: This article has been updated to correct the assets under management (AUM) of Stanbic IBTC Asset Management, which is approximately N4 trillion and not N11 trillion as earlier stated. The initial figure inadvertently combined the AUM of Stanbic IBTC Asset Management with that of Stanbic IBTC Pensions.