The Securities and Exchange Commission (SEC) has urged Nigerians to take advantage of the ongoing e-dividend registration to reduce unclaimed dividends profile and increase liquidity in the capital market and economy. The Acting Director-General of SEC, Ms Mary Uduk, made the plea at a Town Hall meeting on e-dividend and contemporary issues in the Nigerian Capital Market on Thursday in Enugu.
The theme was: “Current Initiatives by the Securities and Exchange Commission (SEC) Nigeria to Enhance Investor Value.’’ The meeting was attended by investors, stock brokers, state government officials, bankers, insurance brokers, the media and traders from various markets across the state.
Uduk, represented by the Head, Port Harcourt Zonal Office of SEC, Mr Obi Adindu, said, “SEC is currently leading the entire capital market industry in an effort to migrate all shareholders to an e–dividend regime’’. According to her, the essence of E-Dividend Mandate Management System is to eradicate or reduce to the barest minimum the incidence of unclaimed dividends.
“Unclaimed dividend is an undesirable feature of the Nigerian capital market which denies investors and shareholders the gains of participating in the capital market. “It denies the economy access to the huge amount of money which should have accrued to shareholders and would have gone into circulation to oil the wheel of the economy. “It is a consequence of the bottlenecks which are inherent in the erstwhile paper dividend warrant regime such as postal system inefficiency, change in investors’ addresses, poor fidelity and human fallibility in dividend payment processes,’’ she said.
Uduk said that the e-dividend regime bypasses these limitations of paper-dividend by ensuring that dividends which do not exceed 12 years of issue were credited directly to an investors’ account after declaration by the paying company. The acting director-general, who said that the e-dividend registration exercise started on Nov. 23, 2016, noted that between the time and March 31, 2018, the commission underwrote the registration cost for all investors that mandated.
“It is my pleasure to let us know, that a total of 2.4 million accounts had been mandated already,’’ she said. Uduk also said that SEC was implementing various initiatives aimed at making our market deeper, vibrant and more effective. “The forbearance window for shareholders with multiple subscriptions had been extended by another year from the Dec. 31, 2018 deadline previously communicated.
“Consequently, we enjoin those who have not come forward for the regularisation of shares purchased with multiple identities, to do so,’’ she said. The acting director-general said that the commission had developed a two-pronged approach to addressing the intractable challenges associated with transmission of shares related to the estate of deceased investors.
“The first step will involve engagement with and enlightenment of the Probate Registry with a view to providing solutions to the cumbersome process of transmitting shares. “Secondly, rules would be developed around the time-frame for transmission shares and the fee structure,’’ she said. (NAN)
