‘It’s a serious problem’ — SEC says unclaimed dividends now at N190bn

The Securities and Exchange Commission (SEC) says unclaimed dividends in the capital market have increased to an estimated N190 billion.

Lamido Yuguda, SEC director-general, spoke at the second post-capital market committee (CMC) media briefing on Friday.

Yuguda cited issues related to identity management in the country as a key factor contributing to the increasing figure of unclaimed dividends.

He also said that multiple subscriptions and identity management processes have played a role in driving up the number.

“The issue of unclaimed dividends, why is it happening? Unclaimed dividends have become a very serious problem in our country because we have issues with identity management within the capital market. We have issues with multiple subscriptions,” Yuguda said.

“People were using different names to subscribe to share offerings. We had situations where not information was captured about individual subscribers. Then, a lot companies changed their names.

“We have had legacy issues that have aggravated the problem of unclaimed dividends.”

He said the commission is working strategically to resolve the issues with the introduction of an electronic dividend (e-dividend) portal.

According to him, both the committee on capital market e-dividend mandate, Institute of Capital Market Registrars (ICMR) and Nigeria Inter-Bank Settlement System (NIBSS) are working on the e-dividend portal to perform better and become user- friendly.

This, Yuguda said, would enable SEC to substantially improve investors’ experience in terms of uploading required details and also address the issue of unclaimed dividends in the capital market.

He described the proposal of the Nigerian Exchange Limited (NGX) to allow companies list dollar-denominated bonds as a welcome development.

“I don’t see any problem with dollar bonds, any bond should be an obligation that is backed by the obligation to pay the bond,” Yuguda said.

“What matters is that the issuer of the bond is able to pay both principal and interest on the bond.”

Yuguda said the commission is undergoing reforms in line with the present administration to reposition the Nigerian capital market as a global investment destination.