Lagos ------------------- The Securities and Exchange Commission, SEC, weekend said it would work with all capital market stakeholders to tackle the issue of unclaimed dividends, valued at N158.44 billion as at December 2019.
The Director General of SEC, Dr. Lamido Yuguda, made this known at the post-Capital Market Committee's virtual news briefing organised by the commission.
Yuguda said the commission would work with the registrars, stockbrokers as well as the Central Securities Clearing System to resolve the issue of unclaimed dividends in the market.
He noted that SEC would work with the registrars to make it easier for shareholders to be unbundled into e-dividend system.
Yuguda said that the commission was seriously looking at the unclaimed dividends issue in order to avoid further accumulation.
Yuguda said, “We are looking at it very carefully; this problem is two-fold. One, we have the existing stock of unclaimed dividends, and second, you want to prevent an accumulation of unclaimed dividends in the future.
“We have the e-dividend mandate at the moment, which should substantially take care of the accumulation of new unclaimed dividends in the future.
“I know this is not working exactly perfectly, but it has substantially reduced the accumulation of new unclaimed dividends.
“The task now is to work with the registrars to make it easy for shareholders to be unbundled unto the system.
“I know there are complaints in the market that some shareholders are finding it a little difficult or some registrars are not working quickly to get people unbundled.
“These are issues we are also looking at and we will come out to the market very soon with a statement about it.
"From the point of parting with your money to the point of getting the money in form of dividend or as proceeds from the sale of stocks bought, the process is extremely complicated.
“For many people, that complication is a long tunnel because they do not want to go through that process and you will agree with me that along that line, a lot of things happen.
“For example, people part away with their money and never get any shares, while others get shares but the shares become worthless at some point and so there are a lot of things that we need to do to simplify transactions in the capital market.
“The process of capital market investment is extremely complicated for many people, that complication is a put off because they don’t really want to go through that process.
“We will continue to work to attract investors by making sure the market is a fair playing field; by ensuring that instruments traded in the market are fairly valued and in the end investors will make profit by having their money in the market.
“For issuers, we will make sure that benefits of listing and issuing in the market far outweighs walking to a bank to borrow money.
“We have seen massive drop in output, collapse in the price of oil, essentially a halt in economic activities in many respects.
“Even before the pandemic, the capital market really needed a kind of revamp.
“We need to attract more investors into the market and we need to also atttract more issuers into the market.”
According to Yuguda, some of the existing stock of unclaimed dividends had already returned to the companies in line with the law, adding that a little percentage was still with the registrars.
He also said that the commission would simplify transactions in the capital market to make it easier for people to invest in even as he observed that the mode of transactions in the capital market had been complicated due to the number of processes to get shares, adding that this had not yielded huge investments in the market.
He said the commission was working legally to close the loopholes in the market to protect investors from falling victim to certain operators who capitalise on the holes to shortchange investors.
On COVID-19, the Director General said the pandemic presents a real economic crisis not only for Nigeria but around the world as a whole.
Yuguda said the commission and all the capital market community had embraced virtual operations since the dark days of the pandemic.