Dividends are the distribution of a Company's profits to its shareholders. Most dividends are issued as interim, after the half-yearly results of the company, and final, after the full year's results. You may also have a Scrip dividend, which is the distribution of a Company's profits as shares rather than cash. Please note that dividends are not guaranteed.
When a company announces a dividend the following dates are announced:
A typical sequence of events following a company's announcement to pay a dividend is as follows:
If the person on the register is not the person entitled to the dividend, the recipient will have to repay it. This is called a dividend market claim. This is done by the Stock Exchange raising a claim against the buying broker on behalf of the seller and vice versa.
If you register for Stocktrade through CREST, for payment of a dividend the company Registrar sends dividend cheques and tax vouchers to your home address. Registrars administer the register of shareholders. Most companies will also give the opportunity to have payments mandated directly into a bank account. Mandate forms are available on request from the Registrars (Stocktrade can provide names, addresses and telephone numbers of Registrars). If your dividends are mandated you will continue to receive the tax voucher from the Registrars showing details of the payment. Unfortunately at the moment you cannot mandate dividends in to your Deposit Account via a CREST account. However, we do hope to introduce this facility in due course.
For holdings within a Nominee Account with Stocktrade, dividends are paid to us from the Registrars. We credit these payments to your Deposit Account and issue statements on a quarterly basis. These dividends will be reflected on your online portfolio.
A corporate action is an activity initiated by a company that affects the price and/or quantity of stock that you hold. Some actions may require a response from you while others may not. Although not exhaustive the following provides an example of the most common.
Stocktrade will handle all corporate actions through your Nominee Account and you will be notified of any changes that affect a holding in your account.
As a CREST Personal Member, and therefore a registered shareholder, you will continue to receive notification of Corporate Actions (e.g.: Rights Issues, Take-overs, Demergers etc.) directly from the Companies' Registrars.
In respect of the above we ask you to adopt the following procedures:
It is essential that you inform us or the appropriate instructions will not be passed to CREST and the Registrars will not process the Corporate Action.
Please send to:
Your instructions will be carried out electronically by us on your behalf.
Shares allotted or cash received will be credited automatically to your stock account in CREST or your Deposit account with us respectively.