SEC Orders Transfer Of over N79 Billion Unclaimed Dividends To Designated Account Under DMO

• After sending out several calls to investors to claim their dividends, the federal government is now taking action
• The Securities and Exchange Commission (SEC) has given the registrars a directive to transfer the unclaimed dividends
• The directive mentions where the dividends will be transferred to and who will control the funds

Ruth Okwumbu-Imafidon, a journalist with Legit.ng, has over a decade of experience in business reporting across digital and mainstream media.

The Securities and Exchange Commission (SEC) has issued a directive mandating all registrars to transfer unclaimed dividends of six years and above to a designated account.

The registrars are to transfer the dividends into an account set up and managed by the Debt Management Office (DMO).

This move complies with the provisions of the Finance Act 2020 and the creation of the Unclaimed Funds Trust Fund (UFTF).

What dividends are affected by this?

According to the SEC directive, this transfer affects unclaimed dividends of six years and above that have accumulated from January 1, 2021, to June 10, 2025.

It, however, excludes dividends above 12 years. The mail from Greenwich registrars to shareholders reads in part:

“Accordingly, the directive mandates the transfer of:

“All unclaimed dividends in our custody that have been outstanding for a period of six (6) years but less than twelve (12) years as at December 31, 2020; and

“All unclaimed dividends of six (6) years and above accumulated from January 1, 2021 to June 10, 2025.

“This implies that all outstanding dividends above 6 years are to be remitted to the Unclaimed Funds Trust Fund (UFTF). Please note that this process is in compliance with regulatory requirements and will be executed immediately.”

Unclaimed dividends in the banking sector hit N79 billion

In the banking sector alone, unclaimed dividends have crossed N79.57 billion as of June 2023.

SEC raised the alarm about the growing unclaimed dividends, noting that this marked an 8.96% increase from December 2022.

Eight Nigerian banks, including First, Zenith, Fidelity, UBA, FCMB, and Fidelity Bank, had the highest unclaimed dividends.

MTN releases link to shareholders

The telecommunications sector is not left out. MTN had announced in its annual report that over 9,500 shareholders of unclaimed shares.

The telco giant released a link inviting the affected shareholders to link their accounts to their shareholding and get their dividends.

The Central Bank of Nigeria (CBN) recently barred banks from paying dividends until they prove that they have returned to financial stability after the removal of the benefits from the COVID-19 pandemic.

Since then, many of the banks have strived to meet the criteria to get the bank lifted.

How to claim unclaimed dividends in Nigeria

In related news, Legit.ng has released steps for shareholders to claim their unclaimed dividends.

Dividends are the returns that shareholders get for their investments in a company, but many of them have remained unclaimed for years.

The SEC has provided a link for shareholders to check the status of their shares and reconnect their accounts to claim the unclaimed dividends.

Source: Legit.ng