The Federal Government's decision to borrow N100 billion from dormant bank balances and unclaimed dividends has sparked concern among investors, who warn the move could weaken confidence in the capital market. The funds were drawn from the Unclaimed Funds Trust Fund (UFTF), established under the Finance Act 2020, which holds unclaimed dividends and bank balances dormant for at least six years. The trust is managed jointly by the Debt Management Office (DMO), the Securities and Exchange Commission (SEC), and the Central Bank of Nigeria (CBN), with all funds remaining legally owned by their rightful claimants. Mrs Bisi Bakare, National Coordinator of the Pragmatic Shareholders' Association, said the borrowing introduces uncertainty about asset security and stressed the need for transparency, accountability, and clear repayment mechanisms. She emphasized that investor confidence is foundational to market integrity and called for stronger investor education and more efficient processes for claiming dividends. Bakare welcomed the Nigerian Exchange Group's extension of trading hours, noting it aligns Nigeria with global practices and improves accessibility for local and foreign investors across time zones. Mr Moses Igbrude, National Coordinator of the Independent Shareholders Association of Nigeria, criticized the borrowing, stating the government should protect citizens' assets rather than use them for financing. He viewed the extended trading window as beneficial, particularly as the market approaches a trillion-dollar valuation. Prince Ridhwan Hamza, Secretary-General of the Liberated Shareholders' Association, also opposed the borrowing, arguing it reflects broader policy challenges that create obstacles for investors. He suggested reforms should reflect local economic realities and urged focus on achieving T+0 settlement instead of adopting foreign trading schedules. The UFTF allows rightful owners to reclaim their funds at any time, with the government acting as custodian rather than owner.
Borrowing N100 billion from unclaimed funds, even with legal backing, risks normalizing state access to private financial assets without explicit consent. When government treats dormant accounts as revenue sources, it blurs the line between custodianship and ownership. Investors' calls for transparency cannot compensate for the precedent this sets on property rights. Confidence erodes not with one policy, but with the quiet expansion of state claims over personal wealth.
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