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The House Committee on Capital Markets and Institutions has raised alarm over the growing unclaimed dividends in the capital market, projected to cross the N200 billion mark at the close of 2020.

This projection was made by the Chairman of the House of Representatives Committee on Capital Markets and Institutions, Babangida Ibrahim, during an investigative public hearing on the “Need to Investigate the Rising Value of Unclaimed Dividends, Unremitted Withholding Tax on Dividends and their Attendant Effects on Nation’s Economy,” which held at the National Assembly Complex, Abuja.

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According to a news report by NAN, he explained that the projection was not in the best interest of the market as well as market participants, since the problem of huge accumulated unclaimed dividends was a major challenge to the development of the Nigerian Capital market, as it had lingered for so long despite the best efforts of market regulators.

In his statement at the investigative public hearing, he said that in 1999, the value of unclaimed dividends was N2.09 billion, and by 2017 it had risen to N100 billion. In 2018, the value was N120 billion, but at the close of 2019, it had risen to N158.44 billion.


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Rep. Babangida Ibrahim disclosed that the problem of the huge volume of unclaimed dividends could adversely affect investor confidence, decrease the availability of long-term capital for economic development, and likely trigger volatility in the regulation of the capital market.

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Recall that the Securities and Exchange Commission (SEC) had attempted to address the issue in 2006, when it sponsored a bill to establish the Unclaimed Dividends Trust Fund (UDTF), but the National Assembly at the time had not passed the bill because of opposition from the body of shareholders.

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The Director-General of SEC at the investigative public hearing, Mr Lamido Yuguda, said about N29 billion of unclaimed dividends were, however, claimed by investors through the introduction of regularization of multiple accounts.

He said SEC introduced the regularization of multiple accounts in 2015, where it requested all shareholders with multiple accounts to harmonize them by filling e-dividend mandate forms.

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According to him, the commission had begun mulling an initiative, to ensure consolidation of multiple accounts which involved the verification and isolation of the account beneficiaries, with a deadline of the first quarter of 2021, as the commission seeks to bring to an end the issue of unclaimed dividends.

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What they are saying

Speaking on the steps taken by SEC to improve the efficiency of dividend payment, the DG of SEC, Mr Lamido Yuguda said:

“Some of these initiatives are the creation of a rule requiring Registrars to make electronic payments of dividends directly into shareholders’ accounts, and engagement with the probate registry to improve the process of obtaining and administering probate.

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“All these initiatives are aimed at improving the efficiency of dividend payments, reduce the quantum of unclaimed dividends and, as a consequence, grow and sustain the confidence of existing and potential investors,”

Rep. Babangida Ibrahim said: “We are aware of measures that have been taken by the capital market regulator in the past to address the problem, but we can all see that the problem remains. In fact, the situation is worsening by the day.

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“Some of the measures include e-dividend, dematerialization of share certificates, publication of names of owners of unclaimed dividends, among others. All these measures are very commendable, especially the fact that they are primarily aimed at ensuring that the shareholders, who are owners of the dividends, get the benefits of their investments.”

He added: “Dividends are distributions of earnings to shareholders, whether cash dividends or share dividends, also known as bonus shares, belongs to the shareholders and not to the company who distributed them or to the government. Therefore, every effort must be made to ensure that the shareholders gets their dividends from their hard-earned investment.”

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