N180bn unclaimed dividends unsettle NGX, as Exchange holds awareness talkshop

THE about N180 billion unclaimed dividends resting in the Unclaimed Dividends Trust Fund being managed by the Debt Management Office (DMO) has remained a concern for the Nigerian Exchange Limited (NGX).

The NGX expressed the concern at a retail investors webinar it organised in collaboration with Futureview Asset Management Limited on Friday, March 17.

Themed, ‘How to Process Outstanding Dividend’, the webinar sought to promote financial literacy by providing participants with ways to process outstanding dividends and a step-by-step procedure for retrieving unclaimed dividends.

“This webinar is to educate the retail segment of our market towards the seemingly unended cases of unclaimed dividends,” the chief executive officer (CEO) of NGX, Temi Popoola, said.

Popoola explained that some retail investors remained unaware of the backlog of unclaimed dividends that have accrued to them over many years,  especially those investors with legacy investment held on their behalf and to be bequeathed as investment by patrimony or inheritance.

“According to the Security and Exchange Commission (SEC), unclaimed dividends in our market have increased steadily, having printed at N180 billion as at December 2022,” Popoola noted.

According to him, it is the aim of the apex regulator to bring this amount processed to zero, so that all investors can get their returns on investment and, possibly, reinvest in the market, and thereby improve liquidity.

The chief executive of Futureview Asset Management Limited, Elizabeth Ebi, disclosed that unclaimed dividends, which rose as high as about N2 billion as at 1999, had “astronomically” swelled to about N180 billion.

Ebi explained dividends to be the shares or profits and retained earnings a company distributes to its shareholders, which usually is done when profits are declared at the end of a financial year.

    “But the shareholders or investors failed to claim them over a period of time, which then become unclaimed dividends usually after six months and up to 12 years,” she said.

    She highlighted some underlying issues causing unclaimed dividends to include lack of awareness by investors, multiple subscriptions for offers, inaccurate information, or issues of identity management.

    At an interactive session with journalists in May 2022, the Director-General of the Securities and Exchange Commission (SEC), Lamido Yuguda, had blamed the rising number of unclaimed dividends on investors’ failure to mandate their accounts, as dividends are now paid electronically.

    An investment and portfolio analyst, Abel Ezekiel, told The ICIR that unclaimed dividends might have kept rising as some investors were yet to perfect the e-mandate requirements, but lamented that with the new digital means, “it, therefore, followed that claiming dividends has become rigorous and challenging for investors.”

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