Unclaimed dividends: SEC introduces regulation on electronic offering

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The Securities and Exchange Commission has revealed plans to regulate the electronic offering in the capital market.

The acting Director-General, SEC, Ms Mary Uduk, described electronic offering as a major achievement that would help to solve the problems of unclaimed dividends in the capital market.

She said the commission was excited about electronic offering and was in full support, hence the need to develop the rules to guide its implementation.

She added that the rules had been developed and espoused to the market.

Uduk said, “It is our belief that the electronic offering will help solve the problem of unclaimed dividends; so, it is something we are backing seriously.

“Through electronic offering, we will not have the problem of identity as we had in previous listings. It has a lot of advantages as it means that people who are not close by during an offering can invest.

“We would be able to get the data we need for regulation, which would make the offering more efficient and cost-saving. It is something we are working on; the rules will soon be out for everyone to use.”

She added that when the rules became operational, an investor in Ghana or South Africa could invest in the Nigerian capital market through electronic offering.

Uduk said, “That is the idea; but when the exchanges finish putting it together, that is what will happen.

“Ours is to make the rules and regulate, but that’s the idea. We want to open up our market so that more people can invest from different parts of the world.

“We want a deeper, bigger, more attractive market. We think our economy is big enough to have a much bigger market.”

Uduk stated that the capital market made up less than 10 per cent of the Gross Domestic Product of the country.

According to her, the capital markets of other countries have more contribution, such as South Africa with over 100 per cent contribution to GDP.

She said SEC believed that there was a large room for expansion.

She noted that the commission was working hard to ensure it commenced in the not too distant future.

Uduk added that SEC was in the process of deploying the software that would help make filing more efficient and easier for capital market operators to send in returns, which would make the market more transparent.

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