BY MICHAEL EBOH
Concerns have been raised over the status of the unclaimed dividends of shareholders in the three nationalised banks -Afribank, BankPHB and Spring Bank.

A financial analyst, Mr. Jude Fejokwu, Principal Analyst, Thaddeus Investment Advisors and Research Limited, who raised the concerns, queried whether the regulators would be able to salvage unclaimed dividends held by the three banks prior to their nationalization.

“Funds were lost in one full swoop by shareholders in Afribank, Spring Bank and Bank PHB.  The major questions arising from this development is; what will happen to dividends outstanding that have not been claimed by owners?  Have the dividends also gone up in smoke?” he asked.

He blamed registrars in the capital market for the rise in unclaimed dividends, saying that the many stumbling blocks set up by registrars, made investors lose interest in claiming some of their dividends.

According to Fejokwu, shareholders look at all the cost implications of the actions of the registrars against the small dividend and abandon the dividend.

“Others feed off of the unclaimed dividends and earn interest. The owner is denied while third parties gain,” he noted.

He lamented the actions of the regulators as regards investors’ protection, saying that the on going recapitalization programmes of the remaining rescued banks have seen shares of almost all the banks being cancelled and reconstructed to the benefit of the acquirers and to the detriment of the shareholders.

“How can our capital market progress when shareholders suddenly are just a passing thought?” he queried.

He said further, “Majority shareholders, not by shareholding but by investors, have been treated unfairly most especially over the past five years, between 2007 and 2011 and counting.  They are left alone to bear their pain under the guise that financial markets are risky.

“This is not in doubt or in question.  Their pain comes from the financial structure and system in place supposed to protect them either ignoring them or working against them.  This compounds their losses beyond the typical investment risk scenario.  This is similar to non-systematic risk applicable to stocks.”

Fejokwu further called for the immediate removal of the five per cent ceiling for upward and downward share price movement, saying that the removal will help address the issue of liquidity, allowing the market to respond positively and transparently to the forces of demand and supply.

He also tasked the authorities of the capital market to immediately approve short-selling for stocks of companies with market capitalization in excess of N7.6 billion ($50 million), as this, according to him, will help remove a good amount of the stranglehold on the market.

He said, “New products, new listings will in our opinion not do much to our market, from a performance and participatory standpoint, until a new found respect is entrenched in our system for shareholders who have been abused and used over the years.

“Shareholders now see a bright light through the emergence of independent research which is gradually gathering more followers and advocates across the country.

“How ready are we to free our capital market from the grip of investment banks, stockbrokers and politically connected individuals that have been compromised to misinform instead of inform?

“There is power in numbers; we tend to focus on the money part which grants power and forget about respect for shareholders and regulations on which the development of any stock market depends.