The company has advised shareholders to complete the e-dividend registration or write to the Registrars to claim their dividends.

The rise in unclaimed dividends is due to several factors, including shareholders who have died and are without information on next of kin, multiple applications by applicants during the investment process, and deliberate actions to deny investors their benefits.

The unclaimed dividend of shareholders of GlaxoSmithKline Consumer Nigeria (GSK) Plc as of December 31, 2022, grew to N1.28 billion.

This is contained in the 2022 company’s audited annual report seen by Nairametrics.

Unclaimed dividend
A cursory look at the company’s audited financial statement released to the Nigerian Exchange Limited and the investment public showed that the outstanding unclaimed dividend represents about 0.8% growth from the outstanding unclaimed dividend of N1.27 billion declared by the group in 2021.

According to the company, the unclaimed dividend was in respect of payments of 31 to 46 of the shareholders of GlaxoSmithKline Consumer Nigeria Plc and its legacy companies.

The group noted that it continues to take steps in conjunction with Registrars to ensure the shareholders receive their dividends.

Company’s advice to shareholders
The Company in a notice to its numerous shareholders has said that some dividends have remained unclaimed as its Registrars- Meristem Registrars & Probate Services Limited records showed.

“Several dividend warrants remained unclaimed or are yet to be presented for payment or returned to the Registrars for revalidation.

Members affected are advised to complete the e-dividend registration or write to or call the office of the company’s Registrars, Greenwich Registrars, and Data Solution Limited.

Shareholders are encouraged to update their mailing addresses by forwarding the latest information to the company or its Registrars.
Shareholders who are yet to complete the e-dividend registration are advised to download the Registrar e-dividend mandate activation form on our website.

The company noted that the Registrars are e-dividend payment ready and urged shareholders to take advantage of e-dividend, to reduce the incidences of unclaimed dividends.

Reasons for the rising wave of unclaimed dividends:
Despite the market that regulators and quoted companies have continued to urge investors in the capital market to register for e-dividend so that they can receive the benefits of their investments in the capital market, the growth of outstanding unclaimed dividends has continued to rise.

Reasons responsible for the growth of unclaimed dividends include issues of shareholders, who have died and without information on next of kin, multiple applications by applicants during the investment process, and deliberate actions to deny investors their benefits through various schemes by some registrars and companies who lack the liquidity to pay.

The Managing Director, of Crane Securities Limited, Mr. Mike Eze, while speaking to Nairametrics, traced the genesis of the rising wave of unclaimed dividends to the indigenization era of the administration of General Yakubu Gowon.

According to him, “During this exercise, those in the position of authority who had the wherewithal acquired shares in the privatized companies with fictitious names of their drivers, cooks, gardeners, dead brothers, dead fathers, etc. in such a way that when the dividends came, they were not able to claim them why because there are no such persons to claim such.”
Speaking in the same vein, the Managing Director, of Highcap Securities Limited, Mr. David Adnori, explained that unclaimed dividends were increasing every year due to several factors.

According to him, the problem started several years ago during the indigenization exercises when several shareholders made multiple subscriptions in fictitious names whose signatures they cannot remember.

He noted that the affected shareholders were also unable to open bank accounts in these fictitious names for the e-dividend collection.

He added that most of the unclaimed dividends were statute barred and forfeited to the companies in which case recovery by the affected shareholders may not be possible in the absence of means of identification.

What you should know
Quarterly reports by the Securities and Exchange Commission (SEC) showed that the value of unclaimed dividends rose from N37 billion as of December 2010 to N180 billion at the end of 2021. This represents a 386.48% increase in the past 11 years despite measures put in place by the SEC to check the rise.

This raise concerns that the value has continued to grow and serves little or no economic gain as some stock investors in the Nigerian capital market continue to leave their dividends untouched.

While shareholders have different reasons for not claiming their dividends including lack of information, multiple subscriptions, challenges in processing the funds, forgotten investments, death, or some other reasons, among others.

It is important to sustain continuous financial literacy to help bring more funds to investors’ wallets and reduce the rising value of the unclaimed dividend.

Market regulators have continued to urge urged investors in the capital market to register for e-dividend so that they can receive the benefits of their investments in the capital market.

Nairametrics