Post Views: 325 The Securities and Exchange Commission (SEC), on Thursday, challenged state governments to become agents of wealth creation for their ...
The Securities and Exchange Commission (SEC), on Thursday, challenged state governments to become agents of wealth creation for their people by taking advantage of the enormous opportunities available in the capital market to revive their moribund companies within their domain.
Speaking at an e-dividend enlightenment campaign in Akure, Ondo State, acting Director General of the SEC, Ms Mary Uduk, noted that some of these companies still have potentials.
Uduk, who was represented by Head, Zonal Offices Coordinating Department, Edward Okolo, said there are instruments in the market to revamp such companies through private equity funding and partnerships.
The SEC boss urged investors to take advantage of the on-going e-dividend registration window, besides regularizing their multiple subscription accounts that will subsequently further help reduce the mountain of unclaimed dividends, while raising liquidity level in the capital market and the economy.
She reminded all that the forbearance window for shareholders with multiple subscriptions has been extended by another year from the December 31, 2018 deadline previously communicated, urging those who have not come forward for the regularization of shares purchased with multiple identities, to do so.
For her, “the essence of the E-Dividend Mandate Management System is to eradicate or reduce to the barest minimum the incidence of unclaimed dividend. Unclaimed dividend is an undesirable feature of the Nigerian capital market which denies investors/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, amongst others,” she stressed.
The e–Dividend regime, the SEC boss assures, bypasses these limitations by ensuring that dividends which do not exceed 12 years of issue are credited directly to an investors account after declaration by the paying company and within a stipulated payment period through simple interbank transfer.
In his own presentation, Head of Lagos Zonal office of the SEC, Stephen Falomo said over the years, the quantum of unclaimed dividends, within the Nigerian Capital Market, has witnessed tremendous growth, hitting N100bn as at January, 2018.
“Companies would continue to declare dividends, (following which) this figure is expected to further grow. The huge figure and continuous growth of unclaimed dividends clearly suggest an urgent need to stem trend” he said.
Falomo said the way out is for Nigerian investors to enroll for the e-dividend regime by completing an e-Dividend ‘Mandate Form’ and submitting same at the nearest branch of his/her Bank or Registrar’s office, for identity validation leveraging the BVN platform of the NIBSS.
Commenting, the Secretary to the Ondo State Government, Ifedayo Abegunde, commended the SEC on its efforts at sensitising investors and assured that the Ondo state government will assist in any way possible to ensure that its citizens derive the benefits of their investments.