The Central Securities Clearing Systems Limited has urged investors to embrace the process of share dematerialisation.

This, according to the organisation, is essential to make share transactions easier for the shareholders.

The Managing Director/Chief Executive Officer CSCS, Mr. Kyari Bukar, said that it was essential that shareholders who were still holding their share certificates in paper form to dematerialise them.

Dematerialisation is the process of conversion of share certificates into electronic form.

A statement by CSCS on Tuesday, noted that there were numerous advantages to be benefitted from the process of dematerialisation.

Bukar noted in the statement that the CSCS was doing everything possible to realise full dematerialisation of all share certificates in the Nigerian capital market.

He said that the implication of the non-dematerialised certificates was that they were not being traded in the system, noting that such share certificates faced the risk of being lost, stolen or defaced among others.

Bukar explained that the CSCS remained the backbone of the nation’s stock market because of its crucial role as the clearing house for all securities in the market, adding that the company was upgrading its clearing and settlement engine.

He said, “CSCS is working with the Securities and Exchange Commission, Nigerian Stock Exchange and registrars to ensure that investors enjoy all the benefits of dematerialisation and this is the time for shareholders who are still holding their share certificates in physical form to convert them into electronic form.

“This would ensure that they will all enjoy the benefits including safety and high liquidity among others. We are, therefore, upgrading our engine and automating all our processes to enhance transparency and efficiency.”

Bukar stressed that the CSCS had contributed immensely to the growth of the stock market since it commenced operations in 1997.

“In the pre-CSCS years, transaction was an upward of six months but now, the transaction cycle is T+3, that is three working days after transaction. This has led to great dynamism in the market due to the turnaround effect on investments of investors,” he noted.

Bukar noted that in terms of standards, CSCS was fully compliant with CPSS-IOSCO standards for payment, clearing and settlement systems.

He enjoined shareholders to provide correct and updated phone numbers in order to receive the alerts, adding that the trade alerts generally supported transparency in the system.

This will support ‘CSCS aspiration to be a highly transparent organisation with the vision to be the globally respected and leading Central Securities Depository in Africa,” he stated.

At the company’s Annual General Meeting last month, shareholders of the CSCS approved the company’s plan to be converted to a public limited company.

Source: Punch/Udeme Ekwere