NG Clearing

NG Clearing Limited is a Nigerian financial-market infrastructure company that operates as a central counterparty clearing house. Its principal role is to clear and settle eligible exchange-traded derivatives and other approved contracts, helping reduce the risk that one party to a transaction will fail to meet its obligations. The company is licensed by the Securities and Exchange Commission to operate as a central counterparty in Nigeria.

NG Clearing was incorporated on 24 May 2016 as NGX Clearing Limited and changed its name to NG Clearing Limited on 4 October 2016. Although the company was established in 2016, it received approval in principle from the SEC in September 2020 and obtained final regulatory approval to perform central-counterparty functions in June 2021. It commenced operations in 2022.

A central counterparty, commonly called a CCP, stands between the buyer and the seller after a trade is executed. It becomes the buyer to every seller and the seller to every buyer, a process known as novation. This structure helps manage counterparty credit risk and gives market participants greater certainty that their trades will be completed even if an original counterparty encounters financial difficulty.

NG Clearing’s core activities include trade clearing, settlement, risk management, collateral management, default-management procedures, and the operation of safeguards designed to protect the integrity of the market. The company’s framework is particularly important for exchange-traded derivatives, where the value of contracts can change rapidly and obligations may remain outstanding for extended periods.

The company was created to support the development of Nigeria’s derivatives market and to strengthen the country’s wider capital-market infrastructure. It has worked with approved trading venues and market participants to provide clearing services for derivatives contracts traded through regulated Nigerian exchanges. Its launch represented a significant development in Nigeria’s financial-market architecture and was described as the first central counterparty platform in West Africa.

NG Clearing operates alongside other market-infrastructure institutions, including the Nigerian Exchange, FMDQ Securities Exchange, and the Central Securities Clearing System. Its role differs from that of CSCS: CSCS functions principally as Nigeria’s central securities depository and provides securities clearing and settlement, while NG Clearing acts as a central counterparty for eligible derivative and other exchange-traded contracts. Nigeria now has more than one licensed CCP, including FMDQ Clear, which serves products traded on FMDQ Exchange and other affiliated venues.

The company is headquartered at 57 Marina Road, Lagos, and has also been associated with the 8th Floor of the UBA Building in the Marina area. Its operations are subject to SEC rules and applicable Nigerian capital-market regulations. By providing a formal mechanism for managing counterparty risk, NG Clearing supports market confidence, settlement certainty, and the growth of more sophisticated financial products in Nigeria.