Euroclear Belgium plans launch of direct dividend payment service
Euroclear Belgium will streamline and harmonise the dividend payment process by offering to receive funds directly from issuers and distribute dividends directly to custodians that hold securities on behalf of their clients. Today, issuers deposit funds for dividend payments to paying agents, which make payments bilaterally to custodians upon presentation of the relevant dividend coupon. Euroclear Belgium will also centralise all tax-related documentation pertaining to dividend payments, such as tax declarations, refund filings and so forth.
Several Belgian companies have already expressed interest in Euroclear Belgium's new service. After the successful execution of Business Solutions Builders International SA's (BSB) dividend payment, ABATAN and Auriga International have decided to use the service in pilot mode.
Stéphane Bernard, Chief Operating Officer of the Euroclear central securities depositories in Belgium, France and the Netherlands, said: "Market practices have changed since the Belgian securities dematerialization law came into force in 2008. For example, issuers have become direct clients of Euroclear Belgium actively using its Euroclear CapitrackTM (Capitrack) dematerialisation and nominative register services. As a neutral partner to the Belgian capital market, Euroclear Belgium is looking to add value to issuers specifically, by reducing dividend payment processing costs, shortening the duration of time from the issuer's release of funds to the distribution of dividend payments to investors and easing payment reconciliation. Centralising dividend payments and tax-related data will bring greater efficiency and transparency to the entire process."
Michel Isaac, Chairman of the Board of Business Solutions Builders International SA, commented: "Since the initial public offering in 2008, BSB has used Euroclear Belgium's Capitrack service for the management of all its dematerialised and nominative registered shares. Faced with a more diversified and larger shareholder base, BSB considers the direct dividend payment service to be offered by Euroclear Belgium as a logical continuation of Capitrack. Thanks to this very efficient payment service, our dividend for the year 2008 has been paid within only five working days of the ordinary general meeting."
Euroclear UK & Ireland
Euroclear Belgium is the central securities depository (CSD) of Belgium, offering a wide range of back-office services to the financial community and a portfolio of added-value services to issuers.
For more information, please visit: www.euroclear.be.
Euroclear is the world's largest provider of domestic and cross-border settlement and related services for bond, equity, derivatives and fund transactions. User owned and user governed, the Euroclear group comprises Euroclear Bank, based in Brussels, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden and Euroclear UK & Ireland. In addition, Euroclear owns EMXCo, a leading UK provider of investment-fund order routing, and Xtrakter, owner of the TRAX trade matching and reporting system. In 2008, the Euroclear group settled more than EUR 560 trillion in securities transactions, representing 157 million domestic and cross-border transactions, and held more than EUR 18 trillion in assets for clients. Euroclear Bank is rated AA+ by Standard & Poor's and Fitch Ratings.
For more information, please consult: www.euroclear.com.