Some shareholders have stressed the need for Capital Market Stakeholders’ Forum to be championed by the Securities and Exchange Commission (SEC) to address problems associated with unclaimed dividends.
The shareholders made this known in separate interviews with NAN in Lagos on Saturday. They said that the disturbing unclaimed dividends of N50.94 billion as being posted by the Institute of Capital Market Registrars (ICMR) in Dec. 31, 2013 was retarding market growth.
The Chairman, ICMR Council, Mr Bayo Olugbemi, said the figure represented 5.05 per cent of the total dividends declared for the past 10 years. The shareholders, however, called on the management of SEC to organise regular market wide stakeholders’ forum to proffer solutions to the menace. Alhaji Gbadebo Olatokunbo, Founding Member, Nigeria Shareholders Association, said sincere stakeholders’ forum would go a long way in finding lasting solutions to unclaimed dividends’ problem.
Olatokunbo attributed the problem of unclaimed dividends to multiple entries and shareholders’ inability to notify their registrars of change in postal addresses. He said that postage of electronic annual reports by registrars rendered unclaimed dividends information useless, noting that, many shareholders were not aware of their unclaimed dividends status. Olatokunbo stressed the need for companies to continue to forward hard copies of unclaimed dividends details to shareholders and stop incorporation of the information in electronic format. He also said that listed companies and registrars should work with shareholders and ensure regular enlightenment programme on the need for shareholders to embrace e-dividend payment system.
Mr Adebayo Adeleke, the Secretary, Independent Shareholders Association of Nigeria, said that the figure was huge loss of income to retail investors. Adeleke said that the unclaimed dividends’ figure was one of the reasons for retail investors’ apathy to the nation’s equity market. He said that the stock of unclaimed dividends would continue to increase unless Section 383 of Company and Allied Matters Act (CAMA) was amended which stated that dividends would not be claimed after 12 years. Adeleke, therefore, canvassed for the urgent need to the act with a view to enthrone a modern, better and efficient capital market, saying dividends should not have an expiry date. He suggested that registrars should be compelled to re-validate expired dividend warrants at Annual General Meeting venues where shareholders congregate yearly.
According to him, banks should accept dividend warrants to be paid into both savings and current accounts. Mr Boniface Okezie, President, Progressive Shareholders Association of Nigeria (PSAN), said that SEC and market operators needed to work together to proffer solutions to the market-wide problem. Okezie said that SEC must conduct enlightenment programme to educate shareholders on the benefits of e-dividend and the need to notify their registrars of change of addresses. He said that shareholders failure to notify their registrars of change was the major problem of unclaimed dividends in the country. The PSAN boss also stressed the need for road shows on e-dividend across the various regions and for investors to open accounts with their banks for dividend payments.