Nigeria's securities regulator is reviewing free-float requirements for listed companies to unlock liquidity and deepen the equity market. This move aims to increase the percentage of shares available for public trading, making it easier for investors to buy and sell stocks. The Nigerian Stock Exchange has struggled with limited liquidity, with many companies maintaining high insider ownership that restricts trading activity.

By potentially mandating higher free-float percentages, regulators hope to attract both domestic and international investors who have been deterred by the market's illiquidity. The review comes as Nigeria seeks to revitalize its capital markets and provide companies with better access to funding. Free-float requirements vary globally, with some markets requiring as little as 25% while others demand up to 50% of shares be publicly available.

The initiative reflects broader efforts to strengthen Nigeria's financial infrastructure and improve market efficiency. Increased liquidity could lead to more accurate price discovery, reduced volatility, and greater investor confidence. For companies, meeting higher free-float standards might mean selling additional shares or encouraging existing shareholders to diversify their holdings.