Lenders in Nigeria rely on a range of security interests, and each has its own requirements for creation and perfection. Failure to register security within the required period or to obtain necessary consents can leave a lender unsecured if the borrower becomes insolvent.
Types of security
- Legal and equitable mortgages over land, requiring Governor's consent for legal mortgages and registration at the land registry
- Debentures creating fixed and floating charges over a company's assets
- Share charges and pledges
- Assignments of receivables, contracts and insurance proceeds
- Charges over bank accounts
- Security over movable assets registered at the National Collateral Registry
- Guarantees from parent companies, shareholders and directors
Perfection requirements
- Corporate Affairs Commission: charges created by companies must be registered with the CAC within the period prescribed by the Companies and Allied Matters Act 2020, or they may be void against a liquidator or other creditors
- National Collateral Registry: security interests in movable assets can be registered under the Secured Transactions in Movable Assets Act 2017, establishing priority
- Land registries: registration of mortgages after consent
- Stamp duties: security documents must be stamped, and duty is usually calculated by reference to the amount secured
- Regulatory consents: some assets, such as licences and certain regulated shares, require regulator consent to be charged
How we assist
- Structuring the security package
- Drafting security documents
- Obtaining consents and managing stamping and registration
- Releases and discharges on repayment
- Upstamping security when facilities increase
- Security trustee and intercreditor arrangements
- Enforcement of security, including through receivership
Related services
See loan and facility agreements, mortgages and real estate finance and asset finance and leasing.
