SEC Stops Issuance of Dividend Paper Warrants

• SEC Stops Issuance of Dividend Paper Warrants

The Securities and Exchange Commission on Tuesday directed all registrars to stop the issuance of dividend paper warrants.

A dividend paper warrant is a financial instrument in form of a cheque issued by a quoted company to its shareholders through which dividend is paid to them.

The Acting Director-General, SEC, Dr. Abdul Zubair, said this during a media briefing on the capital market initiatives of the commission.

He stated that the stoppage of the issuance of dividend paper warrants took effect from January 1 this year, adding that all paper warrants issued up till December 31, 2017 were still valid and should be honoured by banks.

Zubair said, “In line with the approved rules of the commission, all registrars have been directed to stop the issuance of dividend paper warrants with effect from January 1, 2018.

“For the avoidance of doubt, all paper dividend warrants issued up till December 31, 2017 are valid and should be honoured. Banks and registrars are accordingly implored to please note and adhere.”

He also stated that the commission, in a bid to encourage many investors to consolidate their multiple subscriptions into a single account, had also extended the forbearance for multiple accounts till March 2018.

Zubair added, “Investors that bought shares of the same company during public offers, using different names, are allowed till March 31, 2018 to continue to approach their stockbrokers or registrars, to regularise their shareholdings in line with SEC directive on customer identification.

“Thereafter, all shares not regularised shall be transferred on trust to the Capital Market Development Fund.”

On the issue of electronic dividend, the acting SEC DG said the free registration exercise for investors ended on December 31, 2017 in line with the stipulated deadline.

He noted that during the period of the free registration, the commission spent the sum of N315m to underwrite the mandate of 2.1 million shareholders.

According to him, henceforth, all investors who have yet to enrol under the e-dividend platform will now do so after the payment of a marginal cost of N150.

“Such investors should continue to approach their banks or registrars, as usual, to seamlessly mandate their bank accounts for the collection of their dividends electronically, including unclaimed dividends not exceeding 12 years of issue, as the N150 will not be demanded from them at the point of registration,” he added.

On the forensic audit of Oando Plc, Zubair said the probe would go on as agreed, adding that there was no going back on it by the commission.

“We gave a directive that the audit should go on and we still stand by that and no going back on the forensic audit,” he added.