The total amount of dividends declared by quoted companies but not claimed by investors in the Nigerian capital market in 2012 may hit N50bn when the final computation is done.
If this amount is confirmed, it will represent an increase of about N9bn or 22 per cent over the N41bn recorded in 2011.
A stockbroker, who preferred anonymity, told our correspondent on Monday that with the way things were going, it was likely that the amount of unclaimed dividends would be significantly higher than the previous year’s.
He said a lot of issues concerning unclaimed dividends were left hanging and had yet to be addressed, adding that this might lead to a further increase in the amount this year.
The stockbroker said, “I think if the regulators and other concerned stakeholders want to be sincere, they will admit that the figure for unclaimed dividend would likely rise to about N50bn. This is because there are a lot of unresolved issues in the area of getting dividend warrants to the investors, especially the retail investors, who have small amounts of dividends.
“There are still some issues in the area of change of addresses and late delivery of warrants to investors, not to talk about missing warrants and postal challenges. All these contribute to rising unclaimed dividends, and up until now, some people are not satisfied with the figure that was given last year.”
Unclaimed dividends are those dividends, which have been declared by companies and paid but are not taken or claimed by shareholders.
Usually, there are many reasons for dividends being left unclaimed, including ignorance or perhaps the shareholder may have changed his address without informing the appropriate authorities and thus, miss such dividends.
The President, Rennaissance Shareholders Association of Nigeria, Mr. Olufemi Timothy, agreed that the amount of unclaimed dividends for last year could hit the N50bn mark.
He told our correspondent that the regulators were not doing enough and that there was a lot of lackadaisical attitude on the part of registrars, which made it difficult for investors to claim their warrants or revalidate old ones.
Timothy said, “Well, I believe that the way that the market regulators are going on about the unclaimed dividend issue is not yielding the much needed result. I think the regulators need to come to the field, visit the registrars and see the way some of them are treating shareholders who want to revalidate their old warrants for instance.
“These registrars will come up with all sorts of bottlenecks, asking you for documents that you do not have, like bankers’ confirmation and others; all these are hurdles and lead to the large amount of unclaimed dividends.”
On his part, the Chairman, Progressive Shareholders’ Association of Nigeria, Mr. Boniface Okezie, said the interest of investors must be considered in policies made by the regulators, adding that if this was not done, the figure of unclaimed dividends would keep rising.
“Most retail shareholders do not maintain current accounts, they have savings accounts, and it is unfair for most of the banks to insist that you cannot pay your warrants into savings accounts. I think these are some of the things that the regulators should work on to reduce the figure,” Okezie said.
The Director-General, Securities and Exchange Commission, Ms. Arunma Oteh, had told our correspondent last year that unclaimed dividends for 2011 stood at N41bn.
Oteh had explained that SEC was not comfortable with the high amount of unclaimed dividends recorded annually and was doing all it could to ensure a resonable reduction of the amount.
She said there were ongoing interactions aimed at ensuring that the unclaimed dividends were reduced by up to 50 per cent by the end of the year.