CSCS commits to total dematerialisation of share certificates

The Central Securities Clearing System plc (CSCS) has reiterated it commitment towards full dematerialisation of share certificates in the Nigerian capital market.

This was made known at a stakeholder’s meeting held in Lagos recently where the issue of shares migration was discussed.

Kyari Bukar, managing director of CSCS, had earlier stressed the need for investors to embrace the exercise, saying that full dematerialisation of share certificates had come to stay while emphasising that it would promote transparency in the market, enhance investors’ confidence and further internationalise the capital market.

The system of issuing share certificates had posed a myriad of problems such as delay in issuance and dispatch of certificates, delay in verification of share certificates, loss, theft and forgeries of share certificates, respectively.

With a view to addressing these problems, the Securities and Exchange Commission (SEC) had issued a directive that all share certificates should be fully dematerialised in line with its vision to rid the market of certificate losses and associated challenges.

Speaking at the event, Joe Mekiliuwa, general manager, operations at CSCS, said full dematerialisation would ensure total elimination of physical share certificates or documents of title, which represent ownership of securities, and convert these share certificates into electronic book entries.

According to Mekiliuwa, “at full dematerialisation of shares of a company, all existing shares certificates hitherto not dematerialised are electronically lodged into CSCS under the umbrella of the relevant registrars in the account of the investors thereby maintaining the electronic copy in CSCS for control purposes.”

Mekiliuwa allayed fears of investors by assuring them that the steps towards completing the process of full dematerialisation was without any hassles and that they should avail themselves of this opportunity and the benefits it offered.