Nigerian Exchange Limited (NGX) and Futureview Asset Management Limited have further enhanced the capacity of retail investors in processing unclaimed dividends with a webinar to increasingly drive down the number of unclaimed dividends in the capital market.
According to the Securities and Exchange Commission (SEC), unclaimed dividends in the Nigerian capital market had clocked N180billion ($390.4million) as of December 2021. However, this amount represented only five per cent of the entire dividends declared in the capital market that year. The webinar which held on Friday, March 17, 2023, clarified the processes to claim outstanding dividends for investors and recommended solutions to clear backlogs.
In his opening remarks, Temi Popoola, Chief Executive Officer, NGX noted that the issue of unclaimed dividends was not peculiar to Nigeria alone, adding that peer markets like South Africa ($68.26million) also grappled with unclaimed dividends. He said, “Our apex regulator, SEC, continues to work assiduously with stakeholders to reduce to the barest minimum, the cases of unclaimed dividends.
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“Recently, the Commission created an e-dividend portal to reduce the high incidence of unclaimed dividends. The e-dividend portal also enables proceeds from secondary market transactions to be credited to their preferred Bank Account (Direct Cash Settlement). Investors are forthwith encouraged to register on the portal to ascertain the value of dividends they are yet to claim.”
Elizabeth Ebi, Group Managing Director, Futureview Group during her remarks highlighted the need for investors to use the more formal route of fund managers for their investments as this could help them reduce complexity and generate better returns in the long run that they may not be able to achieve on their own.
In her presentation, Ugochi Nnodi, CEO, Futureview Asset Management explained that investors could eliminate the hurdles of dividend recovery through different means: using a stockbroker; engaging a professional asset manager; or subscribing to equity mutual funds like Futureview Equity Fund. “Some of the reasons for unclaimed dividends are lack of awareness, forgotten investments, multiple subscriptions, inaccurate or outdated information/identity management,” she added.
Jude Chiemeka, the Divisional head, Capital Markets, NGX stated in his closing remarks, “At NGX, we remain committed to utilising technology to optimise intermediaries and increase access to the market for retail investors. To this end, we have established a digital gateway to democratise access to the market, reduce friction and drive retail participation in the capital market.”
