A Conceptual Review of Systemic Risk Governance under Nigeria’s Investment and Securities Act 2025 (ISA 2025): Toward Alignment with Global Financial Stability Standards
This conceptual review critically examines systemic risk governance under Investment and securities Act 2025 (ISA 2025). The bill addresses the escalating complexity and potential for widespread of financial crisis in the nation’s markets. Systemic risk is a long identified as a catalyst that cause widespread market turmoil. It is particular acute in an economy that is rapidly evolving which is marked by financial innovation and previous instability. Despite global advances in macroprudential framework, there is a research gap concerning the translation and adaptation of these global standards in the emerging market like Nigeria.
The main objective of this review is to assess whether provisions of ISA 2025 are sufficiently aligned with the international principles for handling risk. Key research questions of this review include; How does ISA 2025 conceptualize and operationalize systemic risk mitigation in Nigeria’s capital markets? What theoretical and international regulatory frameworks inform the design of ISA 2025? The study employed a qualitative methodology, the review combines statutory analysis, comparisons with other regulatory commentaries, and international benchmarks to evaluate the scope and innovative aspects of ISA 2025.
The results indicated that ISA 2025 has significantly improve systemic risk oversight in Nigeria by expanding the monitoring powers of SEC, data sharing among institutions and extend regulations within private sector and digital asset markets. However, the lack of data infrastructure as well as inadequate regulatory resources pose concrete risk on how the law will be enforced and its overall impact. The study recommended that AI based risk analytics should be deployed in phases, formalisation of cross border cooperation, and robust ongoing monitoring to facilitate long term financial resilience. By bridging the gap between global regulatory theory and Nigerian’s reality market, this review provides actionable insights for managing systemic risk in frontier markets.
Keywords: systemic risk, Investment and Securities Act 2025 (ISA 2025), Capital Markets, Financial Innovation, Digital Assets, IOSCO
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