SEC Makes Fresh Moves to Handle Unclaimed Dividends

The Securities and Exchange Commission (SEC) in collaboration with other market stakeholders in the capital market are making fresh moves to tackle the issue of unclaimed dividends. In this regard, a market-wide committee is to be set up to come up with the best solution that will benefit investors and encourage more participation in the market.

Unclaimed dividends in the market stood at over N80 billion and various efforts are being made to reduce the volume. However, speaking at the commission’s 2016 first quarter post-Capital Market Committee (CMC) media briefing in Lagos yesterday, the Director-General of SEC, Mounir Gwarzo said a committee comprising market operators, shareholders and regulators, would be set up.

According to him, the 12 years statute barred provision in the Companies Allied Matters Act (CAMA) will be looked into by the committee and recommend a way forward that would enable shareholders have access to their dividends beyond the 12 years as currently provided by the law. He said the decision to set up the committee was part of the the outcome of the CMC meeting.

Meanwhile, SEC is extending the deadline for free e-Dividend registration in the country by 150 days. Gwarzo said the commission would bear the cost of registration on behalf of any investor who registered within the 150 days grace period, noting however that at the expiration of the grace period, subsequent registration of an investor would attract a fee of N100.

He noted that the e-dividend management system which was launched last year by the Commission in collaboration with the Central Bank of Nigeria (CBN) and Nigeria Interbank Settlement System (NIBSS) to enable investors have direct access to their dividends has enjoyed high level of compliance from the investing public.
According to him, within three months the public enlightenment programme began, the commission has achieved over 4000 per cent growth in the number of investors that registered to have access to their dividends.

Gwarzo said the Commission’s concern was to bring back retail investors to the nation’s capital market.
“Our prayer is that in the next 10 years we will raise the participation of the retail investors to 45 per cent from less than two per cent presently,” he said.

He said the need to ensure more participation in the market led to the Commission to embarked on various initiatives like e-Dividend, Direct Cash Settlement, National Investors Protection Fund (NIPF) among others to attract retail investors to the Market.