- e-Dividend Mandate: Unclaimed Dividends Now N60bn
Over time, the increasing volume of unclaimed dividends in the capital market has been generating arguments among market stakeholders and has become a source of concern for capital market operators.
The Securities and Exchange Commission, in a bid to tackle the problem by reducing the volume of unclaimed dividends in the system, came up with the e-dividend mandate.
The e-Dividend Mandate Management System was launched in 2015 by the SEC to enable investors to easily complete their bank mandate with company registrars.
Investors are to download and fill the Registrar’s e-mandate form and submit at the nearest branch of their banks or registrar to register for the collection of their unclaimed dividends and subsequent dividends electronically.
The SEC said registration for the e-dividends would also enable the proceeds from investors’ secondary market transactions to be credited to their preferred bank accounts.
Capital market operators described the e-dividend initiative as a landmark achievement of the SEC and believe that it would reduce unclaimed dividends to the barest minimum.
The Nigerian Inter-Bank Settlement System said the initiative would achieve the goals of eliminating current hardships faced by investors on e-dividends and also facilitate faster processing of investor mandates.
A source at SEC said the current value of unclaimed dividends was slightly over N60bn, compared to the N129bn recorded as of December 2017, but the actual value had yet to be known as the Capital Market Committee had not submitted its latest report on unclaimed dividends.
This would amount to a 53.4 per cent decline in the value of unclaimed dividends in the system.
The acting Director-General, Securities and Exchange Commission, Ms Mary Uduk, announced the extension of the forbearance window for the regularisation of multiple subscriptions held by shareholders to December 2019.
Uduk, while addressing journalists at the third Capital Markets Committee meeting in Lagos, said the decision was jointly made by members of the committee in a bid to reduce the volume of unclaimed dividends in the capital market.
She said the CMC agreed to shift the deadline by one year because they realised that quite a number of investors had yet to understand the importance of regularisation.
She stated that the likelihood of disruption by electioneering was also taken into consideration to enable more people to be captured in the regularisation.
Uduk noted that a lot of investors had bought shares in different names, making it difficult to properly capture the data of shareholders.
Data from the e-Dividend committee showed that the statistics of approved mandates declined by 11.38 per cent in the third quarter of the year.
The number of approved mandates in the second quarter stood at 53,995 and dropped to 47,849 in Q3.
At the beginning of the year, 64,376 approved mandates were recorded, compared with the 13,166 recorded in September.
The data showed that the total approved mandates to date were 2,599,641, while N2.7m revenue from mandate processing fees had been generated and shared among banks, registrars and SEC.
A shareholder, Olalekan Oregbesan, said registrars were frustrating efforts to register for the e-dividends.
He said, “Once you fill the e-mandate and the bank certifies you, registrars will still demand signature specimen from brokers. This is a hitch in the registration process.
“To me, after the bank has verified you and you have provided your bank verification number and passport, I do not think there is any basis for further certification; it is not needed.”
According to him, banks are more co-operative than registrars.
Oregbesan added that the e-dividend system was, however, better than the paper system.
The President, Institute of Capital Market Registrars, Mr Bayo Olugbemi, explained that the shareholder identification process was a necessity.
He said, “Someone with intent to defraud can falsify records from the beginning to the end. That you have a bank account does not mean that the signature attached to your bank account is the same as that with the registrars.
“Some people have more than one signatures; different signatures for shareholding, banks and other purposes. So, it is a registrar’s duty to compare the records with him with that of the bank. Signatures need to be checked and confirmed.”
He stated that the only thing that might cause a delay in the registration process were discrepancies.
“This has been going on between us and SEC and we are looking to find a way forward”, Olugbemi added.
According to him, any investor experiencing a particular complaint should seek assistance instead of making it a general problem with registrars.
He said, “Up till today, we have issues of identity theft by falsification of records. If we do all that is expected of us, and one still defrauds us, it will be known that we have done our part, according to operations and procedures.
“Though identity theft cannot be completely eradicated, it can be reduced to the barest minimum; and by the time the BVN is fully adopted, it will bring down the issue of identity theft.”
Uduk stated that a committee had been set up to look into and proffer solutions to problems around identity management in the Nigerian capital market.
She said enforcement actions would be taken against identity thieves and also people caught engaging in trading in the shares of public unlisted companies outside a recognised securities exchange as provided by the rules.
Uduk said, “The commission is making concerted efforts in collaboration with the Corporate Affairs Commission and other stakeholders to assist public companies that have yet to register their securities to do so without much difficulty.
“In furtherance of the commitment to develop a vibrant commodities ecosystem, the SEC has commenced the implementation of measures to strengthen regulatory capacity by establishing a Commodities Division.
“In order to boost the e-dividend mandate and Direct Cash Settlement initiatives, the commission will engage the Nigeria Inter-Bank Settlement System to facilitate identity validation and account validation in an effort to enhance market processes.”
She added that further sensitisation would be carried out by stakeholders to enlighten shareholders on the benefits of the initiative.
The former President, Association of Stockbroking Houses of Nigeria, Mr Emeka Madubuike, said the e-dividend mandate had gone a long way but needed more time.
Madubuike stated that registrars would be leveraging annual general meetings as a platform for enrolment to capture more shareholders.
He said, “All shareholders are supposed to enrol on the e-dividend platform, but participation and number of enrolments are still very low.
“The BVN should be better utilised to tackle the issue of identity theft.”
FG Implores Parastatals to Promote the Country’s Digital Economy Initiative
FG Tells MDAs to Promote the Country’s Digital Economy
The Ministry of Communications and Digital Economy under the management of Dr. Isa Pantami, has implored all the federal government parastatals to promote and safeguard the country’s digital economy initiative.
Dr. Isa Pantami, while presenting the keynote address in a virtual forum organised by the Association of Telecoms Companies of Nigeria (ATCON), said based on the negative effects of COVID-19 pandemic, the demand for critical data infrastructure and broadband is now high.
The minister urged government parastatals to put in effort to uphold and promote government’s digital economy initiative designed to reduce the effect of the pandemic on the nation. He also disclosed that the interests of all Nigerians would also be protected by the government.
“Federal government will continue to develop its digital economy policy for a digital Nigeria. Both the Nigerian Communications Commission (NCC) and the National Information Technology Development Agency (NITDA) that are under the supervision of my ministry, now have special departments that promotes digital economy initiative and I urge them and all other parastatals under my supervision, to ensure that they promote the digital economy initiative of the federal government in order to maintain investor’s confidence and to protect the interest of Nigerians, especially telecoms consumers.
“Government on its part will ensure that the interests of telecoms companies and the interest of Nigerians are protected. Government is currently addressing the challenges in the cost of investments such as the issue of vandalisation of telecoms infrastructure, and President Muhammadu Buhari has officially directed all security institutes, through the Office of the National Security Adviser (ONSA), to protect telecoms investments in the country,” Pantami said.
The Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta, when making his presentation said “The COVID-19 pandemic rapidly and sharply ravaged the globe, Nigeria is no exception. Governments therefore, faced unprecedented challenges from COVID-19 pandemic. The impact affects most sectors of the global economy, ranging from health, to education, to finance, to trade and investment.”
While explaining the Commission’s efforts at resolving consumer-related issues, Danbatta noted that less than 500,000 people activated Do-Not-Disturb (DND) code as at 2015 when the code was introduced by the Commission but presently, over 22,722,366 people line on the code.
He also made it known that the commission has resolved 98 per cent of service-related complaints received from telecoms consumers from January 2019 to April 2020.
according to Danbatta “the Commission has monthly engagements with operators as well as quarterly industry working group on Quality of Service and Short Codes, and is currently monitoring 2G Key Performance Indicators, while the KPIs for 4G are being prepared.”
Mambilla Power Project: FG Spends N1.2bn on Survey, Sensitisation
FG Releases N1.2bn for 3,050MW Mambilla Hydroelectric Power Project
The Federal Government has released a total sum of N1.2 billion to the Taraba State Government for the 3,050 megawatts Mambilla Hydroelectric Power Project to finally take-off.
Investigations have revealed that the funds were released for the sensitisation of host communities around the site where the plant is to be constructed and survey works.
The N2 trillion power project is to be located in Sardauna Local Government Area of Taraba State after four decades of on and off planning.
Checks revealed that Sale Mamman, the Minister of Power, visited Taraba State last week, where he met with Darius Ishaku, the State Governor, and discussed the final take-off of the 3,050MW project, among other things.
Mamman on Wednesday had tweeted some of the highlights of his Wednesday visit, saying the Federal Government and Taraba State Government discussed how to speed up the project.
He said, “I paid a visit to the Taraba State Government House where I met with the governor and brother.
“We held discussions centered on how to speed up the final take-off of the Mambilla Hydroelectric Power Project and other power issues affecting the state.”
FBN Holdings Boost First Bank CAR With N25 Billion Capital Injection
First Bank Boosts CAR With N25 Billion Capital Injection
FBN Holdings Plc announced it has boosted the Capital Adequacy Ratio (CAR) of its commercial banking subsidiary, First Bank of Nigeria Limited by N25 billion.
According to the statement released by the bank on the Nigerian Stock Exchange website, the capital injection represents part of the net proceeds of the company’s divestment from FBN Insurance Limited.
It noted that the capital injection upped the bank’s Capital Adequacy Ratio to 16.53 percent –before capitalising year to date profit– as at June 2020.
Oyewale Ariyibi, the Chief Financial Officer of the Company, was quoted as saying “the divestment is in line with the Group’s medium to long term strategic objectives. The divestment has unlocked significant value embedded in the former subsidiary which is being leveraged to strengthen the core banking business for which the Group is renowned“.
Ariyibi further stated that the Company’s objective is to increase capital across the Group in order to drive business growth, enhance efficiency and improve overall shareholders’ value.
Uk Eke, the Group Managing Director, who commented on the company’s performance for the first half of 2020 said “The H1 2020 financial results are impressive and reconfirm our consistent focus on enhanced shareholder value. Despite the difficult operating environment, the results demonstrate our capacity to deliver exceptional services to our customers in these uncertain times. Looking ahead, we remain cautious, but confident that our business is fundamentally strong to surmount any future challenge towards delivering superior financial performance“.
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