Shareholders can start to provide bank info for eDividend

KUALA LUMPUR: Shareholders can now start to provide bank account information to receive cash dividends directly through their bank accounts.

In a statement, Bursa Malaysia said that with eDividend, shareholders will receive cash dividends paid directly into their bank accounts from public listed companies (PLCs) which announce a book closing date on or after Sept 1 2010.

Beginning yesterday, all holders of securities accounts (CDS accounts) maintained with Bursa Malaysia Depository Sdn Bhd (Bursa Depository) are encouraged to come forward to provide their bank account information to their stockbrokers.

Shareholders meanwhile have been given a one-year grace period beginning yesterday, to provide their bank account information for eDividend to their stockbrokers without any fee.

After the expiry of this date, CDS account holders will have to pay an administrative fee of RM10 when they provide their bank account information for eDividend purposes.

New CDS accounts opened from yesterday by Malaysian citizens, permanent residents of Malaysia or Malaysian incorporated or registered entities will be required to provide their bank account information by completing the eDividend form, in addition to filling up the CDS account opening form.

There will be no eDividend administrative fee of RM10 on new CDS accounts. In making it mandatory for PLCs to pay cash dividends via eDividend to shareholders, the stock exchange has also announced changes to the Rules of Bursa Depository and Bursa Malaysia Securities Bhd Listing Requirements. Key amendments say that listed issuers must pay cash dividends via eDividend to their shareholders who have provided bank account information to Bursa Depository.

Listed issuers must now also appoint service providers who are able to provide eDividend services.

They would also have to provide e-notification to shareholders who have provided relevant contact details to Bursa Depository, once the listed issuers have paid the cash dividends out of their account. Under the eDividend initiative, Bursa Depository will be the repository for all bank account information of securities account holders. Such information will be provided by Bursa Depository to listed issuers to enable the listed issuers to pay cash dividends to their shareholders via eDividend.

For the financial year ended 2009, to date, a total of 253 PLCs paid out RM18.8bil in dividends. Of the total 960 PLCs listed in 2008, 518 companies paid a total dividend amounting to RM34bil for the financial year ended 2008. — Bernama

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