The Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC) yesterday issued guidelines for the settlement of all types of securities in Nigeria.
The main aim of the guideline is to promote competitive, efficient, safe and sound post trading arrangements in Nigeria.
This, according to the regulators, will lead to greater confidence in securities markets and better investor protection and should in turn limit systemic risk. In addition, the guidelines seek to improve the efficiency of the market infrastructure, which should in turn promote and sustain the integration and competitiveness of the Nigerian securities markets.
Specifically, on dividend and interest payment, the guidelines stipulate that issuers issuing dividends/interests shall make funds available to the Registrar not later than seven working days after approval.
It states that registrars shall obtain account details of investors for the purpose of electronic payment of dividend and interest, and pay dividend to investors electronically on due date and advise the investors through a credit advice.
It further states that banks shall credit the account of investors not later than T+1 from the date of receipt of mandate and funds from the Registrars.
According to the guidelines, where the banks cannot apply funds into some investors account, the funds and a schedule containing the list of the affected investors shall be returned to the Registrar on or before Day T+2 with reasons for the rejection.
