Unclaimed dividends of Top 4 Banks hit N92.7bn

Despite efforts by the Securities and Exchange Commission (SEC) to reduce the value of unclaimed dividends in the Nigerian capital market, the amount continues to rise year after year. A recent report found that the value of unclaimed dividends in four of the five largest banks in the country increased by N5.6 billion in the first nine months of 2022. The five largest banks in Nigeria, Zenith Bank, United Bank for Africa, GTCO, Access Holdings, and FBN Holdings, account for around 70% of the market share of the nation’s banking industry.

The report revealed that unclaimed dividends in the big lenders, with the exception of GTBank, increased to N92.7 billion from N87 billion. GTCO’s unclaimed dividends were not included in the report as the company did not provide details of them in the third quarter earnings release in late 2022. Zenith Bank’s figures remained unchanged at N28.6 billion, but uncollected cash rewards to shareholders in UBA increased to N12.6 billion from N11.4 billion. Access Bank’s unclaimed dividends grew to N36.8 billion from N34.9 billion, and First Bank’s rose to N14.6 billion from N11.9 billion.

In order to reduce the amount of unclaimed funds held by investors, the SEC introduced an electronic-dividend registration system, which allows companies to pay cash rewards directly into shareholders’ bank accounts. The commission also instructed listed firms to encourage the use of the e-dividend platform at their annual general meetings and other events.

According to the SEC, the total amount of unclaimed dividends as of December 31, 2021, was N180 billion. The Director-General of SEC, Mr. Lamido Yuguda, recently announced that the commission would be working to improve the e-Dividend Management Mandate System (e-DMMS) platform in order to increase the number of mandated investors on the system.

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