The line between policy and commerce blurs when a monetary authority becomes a market operator. This is the reality facing Nigeria as the Central Bank of Nigeria (CBN), which is already the largest shareholder of the FMDQ Securities Exchange (FMDQ) with roughly 15 per cent of the exchange, attempts to assume direct control of the fixed-income trading and settlement platform from November 2025.
Even though the CBN has argued that it needs complete visibility and transparency. the move raises fundamental governance concerns. FMDQ is an exchange registered by the Securities and Exchange Commission (SEC) and government securities are capital market instruments that fall squarely under SEC jurisdiction. They are not the CBN’s monetary policy mandate, and a regulator that also operates the market risks the “referee and player” problem that could undermine the institutional credibility prized by global portfolio investors.
A nurtured irony
The development has an embedded peculiarity. Specifically, the CBN nurtured FMDQ from inception, providing the start-up grant that enabled Africa’s first vertically integrated financial market infrastructure group to flourish. FMDQ has since grown into a formidable platform, recording N249.18 trillion in turnover across just four months in 2026. Its exchange-traded derivatives market was also launched with CBN support; now it integrates banking and capital markets to offer critical hedging tools.
But the returns from FMDQ remain largely institutional. The exchange’s commercial paper market, presently streamlined through technology, has financed companies from retail fashion houses to corporates. Its clearing arm maintains robust default resources of US$20 million in proprietary reserves and over US$12 million in member contributions.
To unlock these returns for the generality of Nigerian retail investors, a demutualisation and public listing that is similar to NGX is imperative. FMDQ has the scale and infrastructure to become a formidable competitor, with its shares a new asset class accessible to the investing public. The SEC, which has been notably silent, must assert its statutory role and defend the market. Rather than vertical integration, the path forward is interoperability, with FMDQ’s trading platform linked with CBN’s settlement system, and thus preserving the independent exchange that market participants cherish.
