Firms slow in sending unclaimed dividends to market stabilisation fund

Despite repeated warnings from the securities regulator, companies listed on the country's stock exchanges are dilly-dallying in submitting unclaimed dividends of their investors to the Capital Market Stabilisation Fund (CMSF).

As a result, the purpose of the fund and its implementation are being undermined, according to the CMSF's Audit and Accounts Management Committee (AAMC).

The committee has expressed its dissatisfaction over the slow response of the listed companies in a press statement issued on Saturday.

In June last year, the Bangladesh Securities and Exchange Commission (BSEC) formed the fund of Tk21,000 crore to support the capital market ensuring liquidity and providing short-term loans among the intermediaries.

At the same time, the Capital Market Stabilisation Fund Rules 2021 were published in the form of a gazette. The regulator also approved the 10-member board of governors of the fund to manage it as per its rules.

Nojibur Rahman, former principal secretary to the prime minister, is currently the chairman of the fund.

Around 350 listed companies held unclaimed cash dividends worth Tk956 crore and unclaimed or unsettled stock dividends worth Tk19,986 crore, said sources.

The regulator gave a deadline to the listed firms to submit unclaimed dividends by 31 May this year.

As of 14 May, the CMSF has received unclaimed cash dividends worth Tk460 crore and unclaimed or unsettled stock dividends worth Tk338 crore.  A large number of firms have yet to submit their unclaimed dividends.

Md Monowar Hossain, chief of operations (COO) of CMSF, said, "We are not getting the expected response from listed companies to submit unclaimed dividends."

In this situation, the CMSF will work in collaboration with the BSEC on how the unclaimed dividends can be brought into this fund, he added.

He said, "We have already invested Tk200 crore to support the capital market ensuring liquidity as per BSEC direction".

Of these, Tk150 crore was invested through Investment Corporation of Bangladesh (ICB) as a term loan and Tk50 crore was invested in the "ICB AMCL CMSF Golden Jubilee Mutual Fund" – a closed-end mutual fund, he added.

The CMSF received Tk22.98 lakh claims from investors, which already have settled 93%, he further added.

Earlier, the BSEC Chairman Professor Shibli Rubayat-Ul-Islam said even several companies do not have data about the unclaimed dividends. Many of them seek time to comply with regulatory requirements.

"But the commission will be strict in this regard after 31 May. It will take action. It will impose a penalty several times higher than the unclaimed dividends of the companies," he added.

Last year, the Bangladesh Bank disagreed with depositing the unclaimed dividends of listed banks and non-banking financial institutions as there is no scope to transfer money without the approval of bank account holders as per the provisions of the Banking Companies Act.

Later in November that year, the commission and the central bank had a meeting in this regard. But the meeting ended without any decision.

Sources said British American Tobacco Bangladesh Company has unclaimed or unpaid shares worth Tk8,403 crore and cash dividends of Tk6.44 crore.

Besides, National Tea Company held Tk923.67 crore, Islami Bank Tk249.36 crore, ICB Tk222.91 crore, Uttara Bank Tk196.44 crore, Singer Bangladesh Tk142.24 crore, Pubali Bank Tk137.22 crore in unclaimed dividends.