By Peter Egwuatu & Nkiru Nnorom
The Securities and Exchange Commission, SEC yesterday disclosed that it has extended the recapitalisation deadline for Capital Market Operators (CMOs) and as well as the free registration of e- Dividend Mandate Management System (e-DMMS) exercise for investors to December 31st, 2016.
The commission also stated that it has directed registrars in the nation’s capital market to discontinue the issuance of dividend warrants to investors with effect from June 30, 2017, in a bid to reduce the incidences of unclaimed dividend in the market.
Director General of the commission, Mounir Gwarzo, who disclosed this at Capital Market Committee, CMC Meeting with newsmen in Lagos, said “We will no longer extend the deadline for the recapitalisation of capital marker operators as they have been given enough time. Any operator who does not meet the deadline would be sanctioned as their licenses would be revoked and be suspended from the market.”
Whenever they want to come back to the market they have to register and go through the gamut of registration exercise before licenses would be given to them.”
Commenting on market development, he expressed dismay that not much people have registered on the free e-DMMS exercise provided by the commission to encourage more investors and protect their investment in the market.
According to him “ Only six thousand (6,000) Nigerians have so far registered for e-dividend, which will allow their dividends to be credited directly into their chosen bank accounts,almost one year after the SEC commenced the campaign with the launch of e-dividend mandate”
To that development, he said “given the fact that there has been low turnout for the e- dividend registration, we have now extended the free e-DMMs exercise from September to December 31st December, 2016.
The commission will bear the cost of processing the e-dividend up to December 2016. No bank or registrar is to collect any fee in this regard from investor”
The DG further stated that the commission is working closely with the executive arm of government to ensure a successful implementation of the 10 year capital market master plan.
“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 of Nigeria, the Attorney General of the Federation, the 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 executives, legislature and the judiciary” he stated.
According to the DG, “the market went down and a lot of investors lost money in this market and sometimes two years after, the Capital Market Committee (CMC) felt there was a need to come together and prepare a document that will be able to address some of these challenges.”
Gwarzo listed some of the recorded achievements in implementing the Master Plan to include Recapitalisation, Direct Cash Settlement, e-Dividend, National Investors Protection Fund (NIPF), and Corporate Governance Scorecard among others.
He emphasised that the only way to attract retail investors back to the market is to ensure that concrete steps are taken to adequately address their concerns especially the issue of unclaimed dividend.
“The issue of unclaimed dividend which according to our records is in excess of N80billion will also be a thing of the past. These unclaimed dividends came about from dividends of small stakeholders like you and me and we need to ensure that they are claimed” Gwarzo added.
He further 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 uptil December 2016, saying that registration after the stipulated timeline would attract a token fee.
He also disclosed that with Direct Cash Settlement, the era where shares will be sold and the proceeds will be given to the broker who will them pay the client is over as what is obtainable now is that once the shares of an individual are sold, the proceed is paid directly into his bank account. With this once the client has authorised the broker and provided all his details, the proceeds will be paid into the client’s account.