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Investors seek all-inclusive approach to rising unclaimed dividend November 05, 2019
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Capital market investors have stressed the need for the Securities and Exchange Commission (SEC), to adopt an all-inclusive approach to tackle rising unclaimed dividend to achieve the desired result. Shareholders, who lauded the SEC’s efforts to address the anomaly so far, however argued that the attitude of registrars and some bank charges pose serious threats to the Commission’s determination to ensure that problems associated with unclaimed dividend are resolved in the market.
 
For instance, they cited bank charges for the acceptance of dividend into savings account of shareholders, as well as COT and withholding charges on the dividend paid into the account.
   
They argued that these charges have already been deducted from the paying company by the banks before acceptance and clearance of dividend into the savings accounts of shareholders. Furthermore, they alleged non-commitment on the part of registrars as custodian of the fund.

According to them, rather than attaching unclaimed dividend list on the annual reports, the registrar distributes only the mandate form to shareholders at the venue of the Annual General Meeting (AGM) without subsequent follow up.SEC had recently stressed the need for capital market investors to enrol on the e-dividend platform, to stem the rising unclaimed dividend in the market put at N103 billion as at December 2017.
 
The e-registration platform was designed as part of efforts by the Capital market regulatory authority to eradicate the difficulties encountered by retail investors in claiming their dividend through their savings account. Shareholders also blamed registrars and banks for the lack of interest in keying into the e-dividend platform despite SEC’s efforts to underwrite the cost of the enrolment.
 
Specifically, the President, New Dimension Shareholders Association, Patrick Ajudua, stressed the need to adopt a holistic approach in resolving issues associated with unclaimed dividend in the capital market.  
   
“Unclaimed dividend has constantly been a topical issue in the capital market. While I commend the SEC for the introduction of e-mandate registration, there is a need for holistic approach in resolving the problems.”He added: “Also, the cumbersome process with regard to estate account; thanks to the regulators for simplifying the process, but the issue of compliance by the registrar is another call to question.”
 
The Publicity Secretary, Independence Shareholders Association, Moses Igbrude, said: “The e-dividend project is a laudable one, which most stakeholders in the capital market value, because it would make it easier for investors to receive their dividend once is declared.“It would help reduce the value of unclaimed dividend in the market, but it is relatively successful in the urban areas compared to the rural areas, and most investors when they retired, moved back to villages without any information on how they would mandate the account.“The tediousness of process is something SEC needs to address to encourage those in the hinterland. They should intensify efforts in adopting all inclusive approach, it should not be a one man affair,” he added.

By THE GUARDIAN