Somewhere in Abuja there is a brown folder holding share certificates in the name of a man we will call Mr. Emeka. PZ Cussons. Union Bank. FCMB. Lafarge. Vitafoam. Conoil. Guinness. MRS Oil. Most were bought in 1981, 1982 and 1989. He is long dead. His children are still being paid. Across Nigeria there are thousands of folders like it, and around many of them sit families who have never sold a single unit and who treat the certificates the way other families treat farmland.
Then there is the other Nigeria. A man we will call Mr. Danladi put ₦54,000 into a major food manufacturer at ₦18 a share when it listed in March 2007. He took 3,000 shares. He held for nineteen years, through everything he was advised to hold through. Today that position is worth roughly ₦211,000. He is not rich. His children will inherit nothing worth inheriting. Same market, same instrument, same discipline, radically different outcome. Something changed. This is what the record shows, and what it does not.
Begin with an honest limit, because the story cannot be told without it. The 1980s and 1990s dividend record is not publicly retrievable in Nigeria. The Nigerian Exchange’s historical data portal does not reach that far back. The old NSE Fact Books, which carried dividend per share, dividend cover and five-year financial summaries for every listed company, survive only as print volumes. Academic studies of Nigerian dividend policy begin at 1995, more often 2006. So nobody can currently prove, from public sources, that companies paid out a larger share of profit then than now not this publication, and not anyone quoting a 1989 payout ratio on social media. What can be proved is what changed in the structure of shareholder reward, and that turns out to be the more damning story.
The first change is the one nobody names. The most important thing that happened to Mr. Obiora’s certificates is invisible on any price chart. It is not what the shares became worth. It is that there are now far more of them than he ever bought. Through the 1980s and 1990s, Nigerian companies routinely capitalised reserves as bonus issues, free additional shares to existing holders. One for every five. One for every four. Year after year. A 1,000-unit holding quietly becomes 4,000, then 9,000, without the holder adding a kobo.
Every subsequent cash dividend is then paid on the larger number, and the larger number keeps growing. Compound that across thirty-five years and you produce exactly the phenomenon families describe: an estate that keeps paying, keeps expanding, and outlives the man who bought it. The children are not living off his ₦2,000. They are living off four decades of free shares stacked on top of it.
Bonus issues carry a second advantage that still holds today. Cash dividends in Nigeria attract 10 per cent withholding tax deducted at source, reduced to 7.5 per cent under treaty and treated as a final tax for most individuals. Bonus shares attract none, because no cash changes hands. Yet today the bonus issue is the exception rather than the rhythm. When NGX Group and NAHCO declared both a cash dividend and a bonus issue in 2026, it was unusual enough to be singled out in market commentary. The default has become a cash payment: taxed, banked, spent, gone. A cheque rather than a position that grows on its own.
The second change is starker, and here the modern record is unambiguous. A Nairametrics analysis published in August 2025 found that 45 of the 146 companies listed on the NGX had not paid a dividend in at least five years; roughly one in every three quoted firms withholding cash rewards entirely over that period. Premium Times went further this year, reporting that at least 60 of about 136 listed companies paid no dividend for at least three of the five years from 2021 to 2025. And the disconnect runs deeper than drought. Several non-paying companies posted triple-digit share price gains in 2025 while distributing nothing at all.
This is the machinery Mr. Danladi walked into. He was sold the logic of the 1989 holder buy, hold, let it feed your children in a market where a third of the companies feed nobody, and where price movement has come loose from cash in the shareholder’s hand. Some of this is legitimate. Growth-stage firms reinvest rather than distribute; Access Holdings has directed the bulk of its retained earnings into pan-African expansion rather than payouts, and investors in such companies are knowingly buying appreciation instead of income. The NGX even created a dedicated Growth Board for companies with that profile. But that is a different product from the one Mr. Obiora bought. It is simply being marketed with the same vocabulary.
The third change is the quietest, and it is sitting in the folder itself. Union Bank of Nigeria: delisted. MRS Oil Nigeria: delisted. Lafarge Africa is now HBM Nigeria Plc, under Huaxin Cement. Over the past two decades more than 100 companies have been removed from what was the Nigerian Stock Exchange and is now the NGX. In 2025 alone, eight were delisted, representing a combined market wipe-off of roughly ₦330 billion. Skye Bank went in August 2019 after the Central Bank revoked its licence and moved its assets to Polaris. Costain West Africa went in December 2016 for persistent post-listing non-compliance. As of March 2026, Union Dicon Salt, Multi-Trex Integrated Foods and Ekocorp sat on the exchange’s delisting watchlist. This matters for a reason that is easy to miss. A 1989 certificate in a company that survived looks like foresight. The certificates from companies that did not survive are in nobody’s inheritance story, because those families have no story to tell. Survivorship is doing enormous, silent work in the folk wisdom, and it flatters the past at the expense of the present.
So what actually changed? Not a secret formula, and not a rule that was quietly revoked. The compounding engine of regular bonus issues largely shut down, so a holding no longer grows in unit count simply by being held. A third of the market stopped distributing cash altogether, while share prices carried on rising regardless. And the pool of companies that survive long enough to become an inheritance kept shrinking. The 1989 buyer was not smarter than the 2007 buyer. He was early, he was lucky in which of his companies outlived him, and above all he invested during the years when owning a share meant automatically owning more of it each year. The 2007 buyer inherited the slogan without any of the machinery underneath it.
Before anyone buys on the promise that their grandchildren will eat from it, there is one question the brochure will not answer: when did this company last give its shareholders free shares, and how many times has it done it?
Names have been changed. Market data as at September 2026.
