The Securities and Exchange Commission (SEC) has revealed that the implementation of the e-dividend system it introduced has started yielding results as N29.2 billion has been settled out of initial N80 billion outstanding has been paid.
According to SEC, about 1.4 million investors have keyed into the system between November 2015 and October 2016.
He said that efforts made by the commission to ensure that the era of stale and huge unclaimed dividends in the market become a thing of the past is now being achieved gradually with the e-dividend registration system.
According to him, from November 2015 to October this year, over N29.2 billion unclaimed dividend has been paid out to investors. “When we started the e-dividend, the major challenge was for people to key into the mandate. There are unclaimed dividend that has not been claimed and the registrars were compelled to pay all the arrears of unclaimed dividend.
“In this country, we have never had this kind of initiative that has reduced unclaimed dividend like we had today. Apart from the investor getting his dividend where ever he is, that investor will be able to get dividend that in the last five years he has not been able to get.
“The e-dividend is for the interest of retail investors and since we started implementing the master plan, our focus has been to ensure they come back to the market and address the complaints,” he said.
Aside, tackling the issue of unclaimed dividend to woo retail investors back to the market, Gwarzo explained that the Commission has concluded plans to make the Direct Cash Settlement become operational by the first quarter of 2017.
“The direct cash settlement where we mandated the broker who has the mandate of a client should credit the clients account when shares of the client are sold. This is against the initial idea that shares are sold, is credited into the brokers account.”
Furthermore, the SEC boss explained that the commission plans to stratify licenses for various exchanges.
“What we are doing is also to stratify license for an exchange. What we have today are unified requirements for companies to set up an exchange now the stratification will lessen the requirement.
“For instance, if you want to set up an exchange under tier 2, the requirement will be lesser than that of tier 1 and if you want to set up under tier 3, the requirement will also be light and the kind of company that also be listed will be lesser than the other one.
“We think it will draw some of these SMES to be listed because over the last 20 to 25 years, we have not seen any much progress in the second tier securities market and now it is rebranded to ASEM, we have not seen much. There a few companies that want to set up a few trading platform and we think we have to give them the prerogative to do that,” he added.
