Nigeria counts down to CCP launch for exchange-traded derivatives
07 December 2021 Nigeria
Image: AdobeStock/Mujib
With its launch on Thursday, NG Clearing will claim the title of West Africa鈥檚 first central counterparty (CCP).
The Nigerian clearing house, which is owned by the Nigerian Stock Exchange (NSE), will facilitate clearing and settlement of exchange-traded derivatives and aims to promote the safety and integrity of Nigeria鈥檚 capital market.
Following its incorporation in 2016, NG Clearing indicates that it was the first clearing house to secure approval from Nigeria鈥檚 Securities and Exchange Commission (SEC) to offer CCP services in the Nigerian market. Approval-in-principle was granted in September 2020, with final approval extended by the SEC in June 2021.
This development aligns with the NSE鈥檚 strategy to support the growth and development of the Nigerian capital market as a gateway to African markets.
The first live transactions are expected to be cleared on NG Clearing鈥檚 platform in late December 2021 or early January 2022, according to sources close to the clearing house.
In preparations for its launch, NG Clearing has been working closely with capital market stakeholders in an educational and public information capacity. Chief operating officer Ayonkunle Adaralegbe says: 鈥淎s a novel niche, we understand that there is a knowledge gap in the market and the core of our strategy is to stimulate the market with high-level training sessions that demystify derivatives clearing.鈥�
NG Clearing鈥檚 CEO Tapas Das says: 鈥淲e have left no stone unturned in ensuring that Nigeria鈥檚 first CCP is positioned to become the most trusted CCP in Africa.鈥�
On 30 September, FMDQ Clear announced that it had also been approved by Nigeria鈥檚 SEC to offer CCP services, with its launch to follow.
Both Nigerian CCPs, NG Clearing and FMDQ Clear, have been accorded observer membership of CCP12, the global association of central counterparties.
The Nigerian clearing house, which is owned by the Nigerian Stock Exchange (NSE), will facilitate clearing and settlement of exchange-traded derivatives and aims to promote the safety and integrity of Nigeria鈥檚 capital market.
Following its incorporation in 2016, NG Clearing indicates that it was the first clearing house to secure approval from Nigeria鈥檚 Securities and Exchange Commission (SEC) to offer CCP services in the Nigerian market. Approval-in-principle was granted in September 2020, with final approval extended by the SEC in June 2021.
This development aligns with the NSE鈥檚 strategy to support the growth and development of the Nigerian capital market as a gateway to African markets.
The first live transactions are expected to be cleared on NG Clearing鈥檚 platform in late December 2021 or early January 2022, according to sources close to the clearing house.
In preparations for its launch, NG Clearing has been working closely with capital market stakeholders in an educational and public information capacity. Chief operating officer Ayonkunle Adaralegbe says: 鈥淎s a novel niche, we understand that there is a knowledge gap in the market and the core of our strategy is to stimulate the market with high-level training sessions that demystify derivatives clearing.鈥�
NG Clearing鈥檚 CEO Tapas Das says: 鈥淲e have left no stone unturned in ensuring that Nigeria鈥檚 first CCP is positioned to become the most trusted CCP in Africa.鈥�
On 30 September, FMDQ Clear announced that it had also been approved by Nigeria鈥檚 SEC to offer CCP services, with its launch to follow.
Both Nigerian CCPs, NG Clearing and FMDQ Clear, have been accorded observer membership of CCP12, the global association of central counterparties.
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