Shareholders urge collaboration with operators over unclaimed dividends

*It is evident there was a disconnect between regulators, stockbrokers and others in the value chain, say shareholders’ associations

*Highlight some of the steps regulators should take to ensure a smooth and hitch-free enrollment in a fresh initiative

Isola Moses | ConsumerConnect

In view of the high rate of share investors’ unclaimed dividends in the Nigerian Capital market, shareholders have called for collaboration with the Capital market operators involved in the e-dividend value chain to resolve the current challenge.

Agency report says the shareholders in interviews Monday, August 24, in Lagos, urged all players in the value chain to play their part in driving the initiative effectively.

E-Dividend is the payment of dividend due to a shareholder through a direct credit into his or her nominated bank account rather than issuance of cheques or warrant.

Some investors, according to the shareholders, still find their names under the unclaimed dividends list even after enrolling for the e-dividend initiative meant to improve Capital market activities in the country.

They stressed the need for regular update of unclaimed dividends data by both Registrars and quoted companies to avoid misinformation.

Chief Timothy Adesiyan, a former President, Nigerian Shareholders’ Solidarity Association, urged Registrars to cross-check unclaimed dividend lists to remove names of those already captured under the e-dividend.

Adesiyan said that shareholders were happy with the e-dividend initiative, but there was still a lot to be done by the regulators in the space.

He also complained about the list of unclaimed dividends published in some national dailies which he considered illegible.

Chief Adesiyan stated: “The enrollment for the e-dividend is not giving us any headache, but rather it is a relief because once you are enrolled into the scheme, dividends will be credited directly into your account.

“Another challenge is that when these companies publish the list of shareholders in the media, you find it difficult to read them.

“They are not legible; you cannot see the names, so the purpose of which they are publishing the names is defeated.”

According to him, “it is a good initiative; we are enjoying it and we are cooperating with the initiative.

“What the registrar’s should do is, when they are sending unclaimed dividend list, they should cross check some of those names that have been captured into the e-dividend format, if that is done, they will be helping us a lot.

Mr. Moses Igbrude, the immediate past Publicity Secretary, Independent Shareholders’ Association of Nigeria said it was evident that there was a disconnect between the regulators, stockbrokers and others in the value chain.

Shareholders in the hinterlands are facing challenges with the e-dividend scheme and wondered why newly listed companies in the stock market still have unclaimed dividends, he said.

Igbrude added: “A lot of shareholders are having challenges with the e-dividends scheme, especially those in the hinterland, apart from the percentage of those who have keyed into it.

“Those who have mandated their accounts still have unclaimed dividends in buying new shares on the floor of the exchange, it is a major problem to the whole process.

“All the stakeholders in the value chain should take it seriously by fulfilling their own part of the chain, starting from the stockbrokers that collects the signature and transmits same to the Central Securities Clearing System (CSCS) and registrars.

He, however, highlighted some of the steps to be taken by the regulators to ensure a smooth and hitch-free enrollment in the initiative.

“Each stakeholder in the value chain must and should genuinely carry out their individual roles effectively and efficiently. That is, the stockbrokers, the CSCS, registrars, the banks and regulators.

“The registrars should develop and deploy modern technology in their system that can recognise and synchronise similar features as it concerns human identification.

“Individual companies should engage SEC and develop ways to identify and trace their shareholders or their families who may have changed location because of exigencies of life.”

He further stated that “after all, there is a regulation that state that all unclaimed dividends should be in a dedicated account and managed outside of the company.

“The interest yield on these funds should be used in tracking and tracing the shareholders instead of the company just claiming the interest,” he said.

Alhaji Olatokunbo Gbadebo, a shareholder activist, lauded the e-dividend initiative and commended registrars for promptness in making sure shareholders were captured.

Gbadebo stated that shareholders must appropriately fill their e-dividend enrollment forms and submit with their passport photographs, including other details such as BVN for proper capturing.

“Honestly, the e-dividend is commendable and shareholders are happy with the initiative.

“Shareholders are, however, advised to ensure proper registration with the registrars. They will give you a form to fill and submit to them, now if you do not fill that form properly your enrollment is incomplete.

“There is also the need to provide your other bank information during the registration process, shareholders who fail to do so, have not completed the enrollment for the e-dividend.”

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