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N80bn Unclaimed Dividends: Banks, Registrars to Appoint E-Dividend Champions

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Godwin Emefiele on banking

As part of measures to address the rising trend of unclaimed dividends in the nation’s capital market, which has hit the N80 billion mark, banks and registrars have been mandated by both the Central Bank of Nigeria, CBN and the Securities and Exchange Commission, SEC to set up e-dividend champions in their respective institutions.

Also, work is underway to address overlapping functions between the Debt Management Office, DMO and SEC, just as the commission is to use moral suasion in attracting telecommunication companies, oil and gas and other blue chip companies to list on the Nigerian Stock Exchange, NSE.

It was also gathered that the commission is canvassing for tax concessions that will attract more investment into the capital market.

The National Assembly is working closely with the DMO and SEC to address the overlapping functions observed in the discharge of duties by both organisations.

Specifically, the Director General of SEC, Munir Gwarzo confirmed that work is underway to address the overlapping functions in both institutions.

According to him “Very soon we will give you the details where there are overlapping functions between the two institutions.” The SEC DG further hinted that the CBN will also sanction banks that fail to comply with the free e-dividend mandate which is expected to end on 31st December 2016.

Gwarzo said attaching deadline to e-dividend registration was necessary to ensure compliance by investors, observing that any bank that fails to comply with free mandate processing on e-dividend will be duly sanctioned.

He said “SEC has been in the vanguard for people to register for e-dividends, but whenever you go to the bank or any of the registrars, people tend to be frustrated because there seems to be some misunderstanding between the banks and the registrars.

So, we had a very successful meeting last Monday where we had all the registrars, all the heads of operations of banks, we also got the Director of Payment System of the CBN and Director of NIBSS and we sat down and exhaustively discussed the issue and we resolved that each bank is going to appoint an e-dividend champion and CBN will as well direct the banks to have these e-dividend champions.

“The e-dividend champion will be the one that will liaise with the head of operation of each bank and every registrar is also expected to have e-dividend champion. We agreed that every Compliance Officer for every registrar will serve as e-dividend champion.

We also agreed that any time the registrar or the banks have any issue that requires clarification, Nigeria Inter-Bank Settlement System, NIBSS will provide the clarification. The registrars also agreed that whenever they have any issue with respect to identity of an investor, within three to four days, they will reach out to the bank or NIBSS.”

He explained that once an investors registers for e-dividend, the backlog of his/her unclaimed dividend that are not yet status-barred would be credited to his account by his registrar. He added that SEC would continue to underwrite the registration for e-dividend until December 2016, saying that registration after the stipulated timeline would attract a token fee.

As part of its advocacy programme, he said the commission has met with all the strata of the government in an effort to get their buy-in to the Capital Market Master Plan and recently with the Minister of Finance, Mrs Kemi Adeosun, with regards to considering tax concessions that will attract more investment into the capital market.

“The Capital Market Master Plan Implementation Committee, CAMIC, met the President of the Federal Republic of Nigeria; we also met the Governor of the Central Bank, the Attorney General of the Federation, and Speaker of the House of Representatives. This is to ensure that we have their buy-in because for you to be able to implement the Master Plan successfully, you need the buy-in of the executive, legislature and the judiciary.

“You will recall that in February this year, we had a two-day session with the judiciary in which we discussed with them what the capital is, what the SEC is and largely what the Investment and Securities Act, ISA, so that we can get their support and cooperation.

We also had a two-day session with the National Assembly; SEC partnered with the Committee on Capital Market both at the House of Representatives and Senate and we had a very successful outing. That is part of our advocacy strategy so that we have all the levels of government buy into the master Plan.”

“Just last Saturday, we had very successful meeting with the Minister of Finance and we had in attendant the chairman of the Federal Inland Revenue Services, FIRS, and the DG of Debt Management Office, DMO. For the last 30 – 40 years, the capital market has been clamouring for certain concessions with respect to tax and certain capital market products which we believe that will further enhance the development of the market” the SEC DG added.

“We have no other place to invest our little funds than in our market and that is why we are trying to cultivate your appetite and the only way to do that is to address some of these issues. Once these issues are addressed and the retail investor returns, we will be able to raise participation in the market from 2 per cent it is now to about 4 per cent in the next 10 years.”

Continuing he said “The BVN platform that is being provided for the e-Dividend will also enable us to implement other initiatives in the market. For instance with the BVN platform everyone that operates in this market as an investor will have his data within this system, so if anyone wants to defraud, it cannot be done. People cannot impersonate others as the platform will expose them.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Coronavirus – Africa: IMF Staff Completes Staff Visit to Senegal

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IMF Managing Director Kristalina Georgieva

IMF Visits Senegal to Assess COVID-19 Impacts

End-of-Mission press releases include statements of IMF staff teams that convey preliminary findings after a visit to a country. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board.

The Senegalese economy is expected to contract this year as a result of disruptions in economic activity due to the COVID-19 pandemic. A recovery is underway, but uncertainty regarding its speed and extent remains significant; execution of the revised 2020 budget is proceeding largely in line with expectations, with a robust implementation of the Economic and Social Resilience Program (PRES) to address the COVID-19 pandemic; the authorities and the IMF team made considerable progress on key parameters for the draft 2021 budget, ahead of the second PCI review mission planned for late October 2020.

A staff team from the International Monetary Fund (IMF), led by Ms. Corinne Deléchat, conducted a virtual mission from September 9-18, 2020, to update macroeconomic projections, discuss 2020 budget execution and plans for the 2021 budget. At the conclusion of this mission, Ms. Deléchat issued the following statement:

“The Senegalese economy has been severely hit by the COVID-19 pandemic, with real GDP growth now expected to contract by 0.7 percent this year, reflecting the larger-than-anticipated disruptions in economic activity stemming from the pandemic and strict containment measures. A gradual recovery started in May with the lifting of most COVID-19-related restrictions, followed by the reopening of borders in July. Senegal’s strong health response is showing encouraging signs with a steady decline in new COVID-19 cases and hospitalizations over the past four weeks. In 2021, output is projected to rebound back to above 5 percent, boosted in part by favorable prospects for agriculture. This projection is however subject to significant downside risks, reflecting uncertainties around the speed of the global recovery and the evolution of the pandemic, which could continue to affect important sectors of the economy such as tourism, transport and hospitality.

“Budget execution through end-August 2020 was broadly satisfactory, and the objectives for the remainder of the year set in the revised 2020 budget remain within reach. Uncertainties related to the mobilization of programmed resources however remain. Therefore, the mission encourages the authorities to continue with their prudent approach in order to maintain the deficit at around 6 percent of GDP as envisaged in the 2020 revised budget. The mission commends the authorities for the strong and transparent implementation of their Economic and Social Resilience Program (PRES). Most of the planned COVID-19 measures have already been executed, as detailed in the June 2020 quarterly budget implementation report. The mission welcomes the recent repeal of the decree on derogatory procurement procedures for COVID-19 related spending, which will from now on follow the normal procurement procedure. The authorities have also finalized a new recovery plan which aims to support a return to strong and inclusive private sector-led growth, focusing on accelerating the structural transformation process and enhancing the economy’s resilience through diversification of the productive base.

“The mission and the authorities made significant inroads in discussing the contours of the draft 2021 budget. Given high uncertainty and lingering effects of the pandemic on some sectors of the economy, the draft 2021 budget should aim to strike a balance between supporting the recovery, including through a robust investment plan on the one hand, and fiscal and debt sustainability also consistent with the WAEMU’s external stability on the other. To that effect, the 2021 fiscal stance should continue to signal a strong commitment to return gradually to a budget deficit of 3 percent of GDP by 2022, in line with the WAEMU convergence criterion, as the situation normalizes. Discussion on the draft budget will continue in the coming weeks.

“The second PCI review mission will take place in late October 2020, with a Board meeting tentatively planned for December 2020.

“The mission wishes to thank the authorities for the frank, open and constructive dialogue.”

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Over 60% of The global Gold Demand is for Jewelry and Investment

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Gold

More Than  60% of Global Gold Demand is for Jewelry, Investment

Data presented by Buy Shares indicates that jewelry and investment account for 37.29% and 26% respectively of the total global gold demand. As of September 2020, the total global demand for gold stood at 5.29 million kilograms or 186.8 million ounces.

Gold’s role as a safe haven for investment

Central bank’s demand for gold accounts for 12.14%. Other notable sectors in gold demand include bar demand (7.45%), industry (6.07%), electronics (4.86%), coin (3.85%), medals (1.13%), other (0.92%). Dentistry recorded the least demand at 12,587 kilograms or 0.23%.

The research highlighted the growth of gold as an investment avenue. According to the research report:

“Gold as an investment is subject to cyclical volatility since many investors speculate on its value. The high demand for gold for investment can be linked to the fact that the precious metal is considered a safe haven in the event of market volatility. This year, the market experienced the highest volatility rate due to the economic impact of the coronavirus pandemic. In general, gold can be used in portfolios to protect the purchasing power, reduce volatility, and minimize losses during moments of market shock.”

The Buy Shares research also overviewed countries with the highest demand for gold. The research reviewed 15 top countries with the demand totaling to 2,042,725 kilograms as of September 2020.

China has the largest share at 700,442 kilograms, while India is second at 625,561 kilograms. The United States is a distant third with its goal demand almost five times less than China at 148,316 kilograms. Turkey and Germany emerged fourth and fifth at 100,380 kilograms and 90,472 kilograms.

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US 2020 Election: Leading Organisations Donate Over $255m for Campaigns

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trump and obama

Top 1o Leading Organisations Donate Over $255m Towards US Election campaigns

Ten leading global business organisations have donated over $255 million towards the US 2020 election campaigns, according to recent data compiled by Buy Shares.

The data indicates that the top ten organisations contributed a combined $255.20 million towards the U.S elections campaign as of September 8, 2020.

The report also noted that the Democratic Party receives the largest donations at $135.59 million while the Republican Party followed with $119.61 million.

Across both parties, Uline Inc led with $40.09 million contributions towards the Republican Party campaign.

Other top donors towards the Republican Party include Blackstone Group ($31.97 million), American Action Network ($19.88 million), Las Vegas Sands ($14.06 million), and Adelson Clinic for Drug AbuseTreatment & Research ($13.59 million).

On the other hand, Fahr LLC is the largest contributor towards Democratic Party campaigns at $39.65 million. Other leading donors include Sixteen Thirty Fund ($34.33 million), Paloma Partners ($21.76 million), Senate Majority PAC ($21.41 million), and Carpenters & Joiners Union ($18.42 million).

According to the research report: “There is still debate if the organization’s donations influence politics. According to experts, successful companies usually bet their contributions towards the winning candidates. On the other hand, small firms are likely to back candidates who will lose. Political pundits argue that big companies are in a better position at foreseeing future events. To a large extent, the company’s usually support candidates or political parties that are likely to support their priorities. Additionally, in some incidents, stocks of companies that backed the winning candidate might rise after the election. The boost in stock prices tends to attract investors.”

Campaign contributions are used to cover the cost of travel, political consulting, and other the direct costs of communicating the party’s agenda.

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