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 beginning today, 19 April 2010, to benefit from the convenience and timeliness of eDividend. With eDividend, shareholders will receive cash dividends paid directly into their bank accounts from public listed companies (PLCs) who announce a books closing date on or after 1 September 2010.
Shareholders are given a one-year grace period beginning 19 April 2010 to provide their bank account information for eDividend to their stockbrokers without any fee. After the expiry of the grace period, 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 19 April 2010 onwards 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. In this instance, there is 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 Exchange has also announced changes to the Rules of Bursa Depository and Bursa Malaysia Securities Berhad Listing Requirements (Listing Requirements).
Key amendments to the Listing Requirements highlight that:
- listed issuers must pay cash dividends via eDividend to their shareholders who have provided bank account information to Bursa Depository;
- listed issuers must appoint service providers who are able to provide eDividend services;
- listed issuers must 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. In line with this, the Rules of Bursa Depository have been amended to facilitate the implementation of eDividend.
The amended rules, together with the Frequently Asked Questions (FAQs) on eDividend, have been made available for reference on www.bursamalaysia.com .
For the financial year ended 2009, to date, a total of 253 PLCs paid out RM18.8 billion in dividends. Of the total 960 PLCs listed in 2008, 518 companies paid a total dividend amounting to RM34 billion in the financial year ended 2008.
