By Chioma Obinagwam
Nigeria’s Securities and Exchange Commission (SEC) has said it will punish Capital Market Operators (CMOs) who frustrate the e-dividend mandate.
SEC told Confiance News in a statement on Thursday.
“As the Commission works towards resolving any legacy issues with unclaimed dividends, all stakeholders are implored to comply with all directives of the Commission in this regard, as defaulters would be sanctioned appropriately,” he warned.
Continuing he said, “There is no reason why there will be unclaimed dividends for new investors or newly-listed companies adding every investor should be promptly paid his/her dividends upon declaration and payment.
Read also: ‘There are still 4m accounts with incomplete KYC information,’ SEC DG laments
“The Commission has observed that certain Capital Market Operators (CMOs) frustrate the e-dividend mandate process. We have observed that the growth in the number of mandated accounts has been on the decline for some time. The Capital market community has directed its e-Dividend Committee to engage with the Committee of Heads of Banking Operations to encourage better cooperation from banks as we tackle the challenges of unclaimed dividends.”
Yuguda said the Commission has exposed new rules on implementation of the e-dividend mandate and treatment of unclaimed dividends adding that the Commission is monitoring compliance and will not hesitate to sanction erring operators.
He said the past year was challenging for the Nigerian economy, largely due to the effects of the pandemic. Despite a positive GDP growth of 1.87 percent recorded in the first quarter, negative growths in the second and third quarters led to a recession, with the economy finally closing the year at a negative GDP growth rate of -1.92 percent.
On the state of the capital market, the DG said in a pattern similar to many other markets across the globe, the Nigerian capital market suffered a major decline at the beginning of the second quarter of 2020 as a result of the announcement of a lockdown.
“However, the market recovered thereafter, ending the year 2020 with positive growth. So far this year, market performance has been mixed, but with a generally positive outlook, especially as economic activities resume fully and COVID-19 vaccination gains wider acceptance.
“We have continued to support initiatives towards ameliorating the impact of the pandemic, especially through our Capital Market Support Committee on Covid-19. The Commission is at the mid-point of the ten-year implementation journey of the Capital Market Master Plan (CMMP)and has commenced a review to update the assumptions and vision elements of the Plan to align with current realities,” Yuguda said.
He disclosed that between the last meeting and now, the Commission has released a number of new rules to ensure proper regulation and development of the market.
The new rules, he noted, include rules on warehousing and collateral management, crowdfunding, fund management products and nominee companies. It is important that market operators are familiar with these rules and other rules and regulations of the Commission.
Yuguda said the Commission recently reintroduced periodic renewal of registration by CMOs, saying that the rationale is to have reliable data on all active CMOs and strengthen their supervision and monitoring. The renewal process is electronic and the deadline for 2021 renewal is 30th April, 2021.
The DG reiterated that the Commission takes seriously the level of compliance, timeliness and correctness of disclosures made by CMOs as henceforth, appropriate sanctions will be imposed for non-compliance.
Leave a comment