Take the Nigerian Exchange Group's own corporate action from 27 February 2026. The board proposed a dividend of ₦2 per ordinary share of 0.50 kobo nominal value, for the year ended 31 December 2025. To receive it, you had to hold the shares by the Qualification Date of 10 April 2026, the register then closed on 13 April 2026, and payment was due on 29 April 2026. That sequence, hold by a cut-off date, register closes briefly, cash lands weeks later, is the usual shape of an NGX dividend.
The dates are not arbitrary. Under the Exchange's Issuers' Rules, the books of transfer must stay open for at least 21 days after the board passes a resolution recommending payment, then close for a minimum of 5 business days to let outstanding trades settle, and the Exchange must get 14 days' notice before closure begins. The qualification date and register closure you see on any dividend notice are the output of that timetable, not a number the company picks freely.
The market's settlement cycle also moved during this period. From 1 June 2026, trades on the NGX settle on a T+1 basis, one business day after execution, following the earlier move to T+2 in November 2025. Read the dates on each dividend notice itself rather than working them out from the settlement cycle.
The same NGX Group notice also proposed a bonus issue: one new ordinary share for every 3 shares held at the Qualification Date. No cash changes hands. The company capitalises reserves and hands out new certificates instead. Fractional entitlements, where a shareholding does not divide evenly by 3, are to be treated according to a Scrip Dividend Circular, and the allotment date itself was still "to be communicated" as at the date of that notice. That detail matters: a bonus issue can be approved and still leave shareholders waiting, with no fixed date, for the shares to actually land in their accounts.
The tax treatment is where the two instruments genuinely diverge. According to Nairametrics, cash dividends attract 10% withholding tax at source, while bonus share issues do not attract withholding tax at all. A bonus share is not a tax-free dividend in disguise, but it does sidestep that particular deduction, which is a real difference in what reaches the shareholder.
Now the part that should temper any instinct to chase a high yield. When a company pays a dividend, its share price is adjusted downward by roughly the dividend amount on the ex-dividend date, the day new buyers stop qualifying for that payout. Nairametrics reported that seven NGX companies, Julius Berger Nigeria Plc, Jaiz Bank Plc, Skyway Aviation Handling Company Plc, Beta Glass Plc, Chemical and Allied Products Plc, BUA Foods Plc, and Industrial and Medical Gases Nigeria Plc, had their share prices adjusted in this way between 1 and 5 June 2026, following payment of dividends declared for the 2025 financial year. Whichever of them looked best on yield, the sum behind every such ranking is the same: dividend per share divided by price, multiplied by 100.
That formula is the whole problem with yield-chasing. A stock can show a high yield simply because its price has fallen, not because the company is generous or healthy. The number says nothing about whether next year's payout survives, and it says nothing at all about bonus entitlements, which do not show up in a yield calculation yet still affect how many shares you end up holding. Reading a single yield figure in isolation and treating it as the measure of a good dividend stock skips the two things that actually explain it: the price move behind the ratio, and the register and payment mechanics that determine whether you qualify in the first place.
There is also an administrative side that catches people out. E-dividend registration is mandatory for NGX dividend payments, according to Nairametrics, and the SEC's revamped e-DMMS portal lets investors mandate their accounts for electronic payment without visiting a registrar or bank. Shareholders who skip this step are the ones who end up with stale warrants. On unclaimed dividends specifically, the SEC clarified in June 2025 that under Section 60 of the Finance Act 2020, dividends unclaimed for six years or more are to be transferred to an Unclaimed Funds Trust Fund, though shareholders can still claim amounts that were not already statute-barred before 31 December 2020.
The Exchange also backs the timetable with penalties: a company that fails to pay a declared dividend on its due date faces a fine of 5% of the total dividend amount, and one that fails to issue approved bonus shares within three months of AGM approval faces a fine of 5% of the nominal value of those shares. Fines exist precisely because delay is common enough to need deterring, which is its own argument for reading the qualification date and payment date on a notice before you treat the headline yield as the full story.
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