By Amaka Ifeakandu
With the distribution of financial report electronically, registrar companies in the country have been challenged to adopt innovative ways to serve their clients or risk extinction from the system in the distant future.
Group Chief Executive Officer of United Capital Plc, Mrs. Toyin Sanni, who spoke at a stakeholders’ forum organised by African Prudential Plc, noted that with 60 per cent of the revenue of registrars companies coming from deposits for dividends and related deposits driving their revenue, there is need for them to think outside the income for medium to long-term survival.
In her keynote address at the event, she said the “innovate or die” challenge has become most important today, when Nigeria’s Securities & Exchange Commission (SEC) is determined to end the issuance of physical dividend warrants
Speaking on the theme , titled: “leveraging Opportunities in an Evolving Capital Market, the Changing Roles of Registrars,” she said “the deadline for discontinuance of issuance of physical dividend warrants has been extended a number of times to allow for full subscription. New deadline is now December 31, 2017,” explaining that “the desire to migrate towards electronic dividend payment, is borne out of the need “to mitigating risks associated with physical dividend warrants and improving investors’ experience.”
The United Capital boss also recommended the model of “Computershare, a Global leader in not just transfer agency but employee equity plans, mortgage servicing, proxy solicitation, stakeholder communications and other diversified financial and governance services.”
She stated that the revolutions and technology brought into the operations of share registrars, have not been all bad, since it led to “enhanced efficiency, increased specialization, encouraged competition and improved service delivery by registrar businesses.”
To survive the trend and competition, Sanni urged traditional registrar services to expand their horizon from share data/register management, KYC verification, shareholder relationship management, IPO/Bond Issues, probate management services, among others, and begin to explore technological trends for product innovation to meet demands of today and the future.
“The digital revolution must be embraced and B2C (Business-To-Clients) models” explored.
She also suggested the birthing of “technology Products – E-Notifier, E-lodgement for stockbrokers, online account access, dividend cards, electronic voting support.
“The Nigerian capital market is still evolving. Thus, registrars generally have voids to fill within their regulatory ambit.”
The United Capital boss recalled that the transformation in Nigeria’s financial services sector today followed the Central Bank of Nigeria (CBN) Regulation, directing banks to sell their non-banking subsidiaries or to adopt a holding company structure as one of the three main drivers of the changes we are now seeing.
She told participants, that the directive“shook things up in the financial services industry.
“This forced a change in not just the model of the registrar business but of other financial institutions like investment banks, trustees, asset managers, insurers and brokers.”
Earlier, in her address , chairman of African Prudential, Chief Eniola Fadayomi, said the company is mindful of the need to continuously innovate, remain agile and adapt to the changing times, without forgetting “that corporate success has its inherent risks and dangers (including) complacency.
