SEC extends deadline for issuance of dividend warrants to December 31

The Securities and Exchange Commission (SEC) has extended the deadline for stoppage of issuance of physical dividend warrants in the nation’s capital market to Dec. 31, 2017.

Mr Naif Abdussalam, SEC Head, Corporate Communications disclosed this in an interview with the News Agency of Nigeria on Wednesday in Lagos.

Abdussalam said that the deadline was extended to give room for investors to key into the e-dividend payment platform.

He said that the extension became necessary to perfect the commission’s rules on issuance of dividend warrants that was exposed to the public a week ago.

Abdussalam stated that the commission’s issuance of dividend warrants would be a thing of the past by Dec. 31, 2017, with the amendment of the rules and keying into the e-dividend payment platform by more investors.

SEC had in 2016 announced June 30, 2017, as deadline for issuance of physical dividend warrants  to shareholders by quoted companies to tackle unclaimed dividends and mitigate the risks associated with warrants.

He also said that SEC had extended the underwriting cost of investors e-dividend registration to Dec. 31, 2017 from against the earlier underwriting deadline of June 30, 2017.

Abdussalam said that the deadline was also extended to give room for enrolment of more investors in the e-dividend payment platform.

“E- dividend simply refers to an online system of paying dividends to investors when companies declare dividends, which are the profits meant for investors, rather than send it by post, they will just wire it to the investor’s bank account.’’

He stated that the commission’s decision to continue to underwrite the cost till Dec. 31, was part of its developmental role to curb the menace of unclaimed dividend.

The commission’s spokesman said that the e-dividend would strengthen the KYC of all investors in the capital market to curb unclaimed dividend and stopage of unauthorised sale of shares in the market.

Abdussalam added that lost of dividends would be a thing of the past with the e-dividend payment platform.

He said that the commission would continue to leverage on the BVN initiative of the Central Bank of Nigeria (CBN) to boost investors’ confidence in the nation’s capital market.

Mr Mounir Gwarzo, SEC Director-General at the Capital Market Committee meeting in May said that 2.2 million investors had mandated their accounts for the e-dividend payment policy as of April 30, 2017.

He stated that the commission would urge all listed companies to participate in the on-going enlightenment campaign on e-dividend by informing their shareholders at Annual General Meetings (AGM) on the processes put in place to increase the figure.

Gwarzo explained that the e-dividend form could be obtained and properly filled at bank branches or in the office of a registrar and stock broking firms, or could be downloaded and filled by individuals.

He added that the major aim of the e-dividend payment system was to curb unclaimed dividends in the market, noting tha unclaimed dividend figure was reducing due to the e-dividend.

Major shareholder groups in the capital market had been calling for the extension of the deadline to allow more investors to embrace the initiative.