Sunday, January 23, 2022

    Shareholders blame FG, SEC over N170bn unclaimed dividend

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    Naija247news Editorial Team
    Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

    Recent revelation by the Securities and Exchange Commission (SEC), that Nigeria’s unclaimed dividend has risen to N170 billion has continued to generate a huge debate among stakeholders in the nation’s capital market where dividend is seen as a major attraction to investors.

    Although payment of dividends to shareholders of quoted companies in Nigeria has been fraught with several administrative bottlenecks leading to rising unclaimed dividends over the years, the challenge is still far from being resolved even after the introduction of e-dividend option.

    When the SEC launched the electronic payment system (e-dividend) in 2008, it was greeted with much fanfare as it was expected to minimise the rising wave of unclaimed dividends.

    The e-dividend is an electronic dividend payment that enables an investor’s account to be credited after 24 hours of company’s declaring dividend and it was described as a game changer in the market by SEC’s erstwhile suspended Director General, Mounir Gwarzo.

    However, from different administrations under Dr. Abdul Zubair and Mary Uduk, both in acting capacity, the problem of unclaimed dividends still persists. Daily Sun investigations revealed that from as little as over N2 billion in 1999, the figure rose sharply to N158.4 billion as at the end of 2019, representing an increase of 32 per cent from N120 billion recorded in 2018.

    Further investigations reveal that unclaimed dividend in the banking sector in 2020 increased as banks recorded growth in dividend paid to shareholders. For instance, Zenith Bank Plc in 2020 financial year reported N28.04 billion unclaimed dividend from N25.6 billion while Access Bank unclaimed dividend dropped to N15.73 billion in 2020 from N15.88 billion reported in 2019.

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