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By Chukwuma Umeorah
On May 29, 2023, the Nigerian Exchange was valued at roughly N30 trillion. Three years later, under President Bola Tinubu, investors are sitting on a market worth more than N160 trillion, representing one of the largest wealth creation episodes in the history of Nigeria’s capital market.
The rally has, however, unfolded against a backdrop of painful economic reforms, rising inflation and declining purchasing power, a paradox that continues to define Tinubu’s first three years in office.
Even as rising prices squeezed household budgets, stock market investors saw their wealth grow during one of the market’s best-performing periods since the return to civilian rule.
Since assuming office, Tinubu has pursued reforms aimed at correcting long-standing structural distortions: the removal of the petrol subsidy, liberalisation of the foreign exchange market, tighter monetary policy and a sweeping banking recapitalisation exercise. While these policies imposed significant short-term costs on households and businesses, they also transformed investor sentiment and triggered a remarkable resurgence in the capital market, producing record wealth creation, increased fundraising activity, renewed foreign interest and stronger participation by domestic investors.
As Nigeria marked another Democracy Day on June 12, the performance of the capital market stands out as one of the clearest indicators of how economic reform can influence investment behaviour and capital formation.
How the market jumped from N30trn to N160trn
At the time Tinubu assumed office, market capitalisation of listed equities on the NGX stood at N28.845 trillion. By May 29 2026, it had climbed to N160.509 trillion, a gain of N131.664 trillion, or 456.45 per cent, over the period.
The benchmark NGX All-Share Index (ASI) recorded equally unprecedented growth. The ASI surged 372.66 per cent, rising from 52,973.88 points on May 28, 2023 to 250,385.47 points on May 29, 2026. By every conventional measure, this is the most impressive three-year capital market performance under any civilian administration since Nigeria’s return to democracy in 1999.
The gains arrived in a staircase of annual records. The NGX closed 2023 with a 45.9 per cent gain in the ASI signalling the best return since the 50 per cent surge recorded in 2020, and the ninth most successful year in the exchange’s 39-year history. The market opened 2024 as the world’s best-performing stock exchange in the first three weeks of January, before closing the full year at 37.65 per cent. Then 2025 arrived and rewrote the record books entirely. The NGX All-Share Index closed the year at an unprecedented 155,613.03 points, a 51.19 per cent full-year return that cemented Nigeria’s position as the best-performing emerging and frontier market exchange globally. As of May 26, 2026, the ASI stood at 249,738.8 points with a year-to-date return of 60.49 per cent, representing a cumulative 348 per cent gain from the 55,769.28 points recorded at inauguration. The rally was broad-based. Banking, industrial goods, oil and gas, telecommunications and insurance stocks all participated, reflecting wide investor optimism. For many, equities became one of the few effective hedges against inflation and currency depreciation, a store of value as the naira weakened and consumer prices rose.
How reforms reshaped investor sentiment
The first major policy signal came on inauguration day itself, when the President announced the removal of the petrol subsidy. Investors read the move as evidence that the government was prepared to address structural inefficiencies that had long weighed on public finances. The liberalisation of the foreign exchange (FX) market followed, ending a system of multiple exchange rates and foreign currency shortages that had been a significant obstacle to investment. The shift toward a market-driven rate initially triggered sharp naira depreciation, but improved transparency and restored confidence among investors who had long struggled to access and repatriate foreign exchange.
Other major policy actions that shaped the market included the enactment of the Investment and Securities Act 2025, the transition to a T+2 settlement cycle, then to T+1 in June and the extension of trading hours on the exchange. Each, a signal that Nigeria’s regulatory architecture was modernising to meet the expectations of a broader investor base.
Banking recapitalisation triggers historic fundraising
No single development had a greater impact on the capital market during Tinubu’s tenure than the banking recapitalisation programme. Initiated by the CBN in March 2024 and concluded on March 31, 2026, the exercise saw Nigerian banks raise a total of N4.65 trillion ($3.38 billion) in new capital.
The new requirements represented a substantial increase across the board. International commercial banks had to grow their capital from N50 billion to N500 billion, national commercial banks from N25 billion to N200 billion, and regional commercial banks from N10 billion to N50 billion.
Domestic investors accounted for the bulk of the funds raised, contributing 72.55 per cent, approximately N3.37 trillion, while foreign investors accounted for the remaining 27.45 per cent. CBN Governor Olayemi Cardoso confirmed that 33 banks had met the revised capital requirements, noting that the exercise had significantly strengthened the resilience and capacity of the Nigerian banking system, with capital adequacy ratios now exceeding international Basel benchmarks.
The impact on equity valuations was immediate. The combined market capitalisation of 13 listed banks including GTCO, Zenith Bank and UBA — rose to N16.14 trillion in 2025, an increase of 86.8 per cent, or N7.5 trillion, over the N8.64 trillion recorded the previous year.
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Foreign investor confidence had suffered significantly in the years preceding Tinubu’s administration, suppressed by exchange rate opacity, foreign currency shortages and the difficulty of repatriating capital. The post-2023 reforms have materially changed that calculus.
Foreign capital inflow as a share of total market transactions rose from a low of 4 per cent in mid-2023 to an average of 16 per cent by November 2024. At the banking sector level, the shift was even more pronounced: foreign capital inflows into the banking sector rose by 93.25 per cent year-on-year to $13.53 billion in 2025 from $7.00 billion in 2024, reflecting strong investor interest during the recapitalisation drive. For market operators, the return of foreign capital represents a vote of confidence in the direction of economic policy and a source of additional liquidity that has reinforced broader market momentum.
Domestic investors remain the market’s backbone
While foreign investors are gradually returning, domestic investors have remained the primary engine of the market’s expansion. Pension funds in particular have emerged as a formidable institutional force. For instance, Nigeria’s pension industry closed 2025 with total assets under management of N27.45 trillion, up from N22.51 trillion at the end-2024. Pension fund holdings in equity investments rose sharply by 86 per cent year-on-year or N1.7 trillion to reach N3.6 trillion as at August 2025.
Yet, the sector’s potential remains largely untapped: total pension assets account for only about 7.1 per cent of Nigeria’s 2024 gross domestic product suggesting considerable room for deepening as financial inclusion expands. Retail participation has also improved, driven by digital trading platforms, increased financial literacy and the public attention generated by banking capital raises.
A bull market amid economic hardship
The broader economy presents a more complex picture. The same reforms that boosted investor confidence imposed significant costs on ordinary Nigerians. Headline inflation, which stood at 21.82 per cent in January 2023, climbed steeply as the effects of subsidy removal and naira depreciation fed through the economy. By October 2024, it had reached 33.88 per cent. The NBS subsequently rebased the Consumer Price Index (CPI) . Under the new methodology, Nigeria closed 2025 with headline inflation at 15.15 per cent in December, down 19.65 percentage points from 34.80 per cent recorded under the old base in December 2024.
The moderation, however, has not been linear. Inflation ticked back up to 15.38 per cent in March 2026 and 15.69 per cent in April, with food prices and transport costs re-emerging as pressure points. For the majority of Nigerians without equity investments, the record gains on the NGX have offered no direct relief. Experts have cautioned that despite the strengthened banking system, credit to small businesses remains weak, warning that the benefits of the reforms are yet to fully impact the real economy.
The tension is a familiar one in reform economics: the gains accrue first and most visibly to capital, while the costs are borne immediately and broadly by labour and consumers. Supporters of the administration argue that strong capital markets ultimately serve the wider economy by enabling companies to raise funds, expand operations and create jobs, but that transmission takes time.
What operators are saying
David Adonri of Highcap Securities said that while the long overdue market reforms embarked upon by Tinubu resonated well with investors, “the divergence between capital market growth in three years of this administration and the reality of continued economic hardship is because of the futuristic reaction of investors to public policies formulated now but which will deliver results in due course.”
He added that “unfolding economic events and favorable external developments have continued to improve macroeconomic and corporate fundamentals. More game changing listings that will hit the Market very soon can sustain the surging demand for stocks far into the future.”
Truly, the numbers are difficult to dispute. More than N131 trillion has been added to market capitalisation. The ASI has gained over 370 per cent. Thirty-three banks collectively raised N4.65 trillion in fresh capital. Pension assets have grown to nearly N27.5 trillion. Foreign capital inflows into banking surged by over 93 per cent in 2025 alone. The stock market’s performance demonstrates how decisive policy choices can reshape investment flows and accelerate capital formation. Yet the disconnect between record market gains and the economic realities facing most Nigerians remains the central unresolved tension of the reform programme.
Analysts noted that as the administration enters its fourth year, more emphasis should be placed on ensuring the prosperity visible on trading screens finds its way into wages, credit access, productive investment and, ultimately, improved living standards for the broader population.
On his part, the Chief Executive Officer of Arthur Stevens Asset Management and past President of Chartered Institute of Stockbrokers (CIS), Olatunde Amolegbe acknowledged that the stock market has outpaced the main street with regards to its overall response to the economic reforms being pursued by this government
According to him, “that is not unusual because the market typically forecasts the likely future impact of policy but prices it into stocks today. This is why you are seeing stock prices rising and why consumer purchasing power is dwindling.”
Amolegbe expressed optimism that the benefits that the market rally would soon begin to substantiate. “The market expects that with time these reforms will be positive for job growth and economic expansion
“My expectation is that if this happens then the populace will be the ultimate beneficiary.”
