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Business News of Sunday, 8 May 2022


How government can access unclaimed dividends – SEC DG

Director-General, Securities and Exchange Commission (SEC), Lamido Yuguda Director-General, Securities and Exchange Commission (SEC), Lamido Yuguda

Mallam Lamido Yuguda, the Director General of the Securities and Exchange Commission (SEC) at the just concluded Capital Market Committee (CMC) meeting spoke about the lingering issues of unclaimed dividends, digitisation drive to manage the process amongst others. Nduka Chiejina, Assistant Editor, was there. Excerpts:

Unclaimed dividends have always been an issue with many shareholders affected. What is the SEC doing to curb it?

The reason why the number may be going higher is because a lot of investors have not mandated their accounts. Dividends are now distributed electronically, so dividends go directly into the investors account and if everybody mandates their accounts there would be little unclaimed dividends in the system. SEC has invested a lot of resources, has embarked on a number of programmes on investor education to ensure that people mandate their accounts. This process is still open and can be done with the registrars, forms can be obtained from the banks too and it’s a very simple process. We also have on our website a tool that assists the investors to determine any unclaimed dividends that they have. And I would encourage everyone to take advantage of these tools or to directly speak to the complaints section of the SEC and we would guide that person appropriately.

You should remember that unclaimed dividends have now gone into the new Unclaimed Dividends Trust Fund that is managed by the DMO. So there are lots of developments in that area and SEC is now not the only party that has this unclaimed dividend. There are a lot of people who are getting their unclaimed dividends paid to them from the Trust Fund and we will not immediately have the information.

Since the introduction of the electronic dividend system, how has it helped in checking the cases of unclaimed dividends?

It has significantly helped to reduce the unclaimed dividend. A lot of people have been able to get back their dividends. You know the Nigerian capital market is a very big market and every year companies declare dividends and Nigerian investors benefit from it. The issues are we have some people who are not coming forward to get their dividends because they have not mandated their accounts; we have cases of multiple subscriptions which the Commission has made a lot of efforts to resolve. I think these are the reasons why we still have unclaimed dividends in the system.

Does the federal government still have access to the unclaimed dividends fund?

There is an Unclaimed Dividends Trust Fund at the moment and it has a framework whereby dividends that have not been claimed over a certain period are transferred to this Fund and it will be utilised in line with the investment objectives of that Trust Fund. However, if anybody comes forward at any given time to claim their unclaimed dividends, this Fund will be able to repay these dividends without any problems.

Is it true the capital market will be automated by the third quarter of 2022?

Yes, I said that the automation of this process would be concluded by the end of the third quarter this year. This has actually been ongoing over the last one year and we are expecting and working with NIBSS to ensure that by the end of the third quarter the automation of the EDMMS process would be completed.