Issuers to distribute dividends through the Central Depository

• Citibank and Romanian Post Office to ensure support for the project

Starting this year, dividends paid out by issuers listed on the stock exchange will be distributed to shareholders through the Central Depository, according to a press release by the institution.

The management of the Depository has approved the method for the distribution of dividends, as well as the banking institution that will assist the Central Depository - Citibank Europe plc, Dublin - the Romanian branch.

"This service will beneficial for investors, since it will entail far lower costs, especially for those that have holdings in several issuers. The service will also ensure predictability, meaning investors will be able to know in advance the moment they will receive their dividends, which will allow them to better plan their cash flow", said Adriana Tănăsoiu, general manager of the Central Depository.

The Central Depository intends to distribute the dividends for 2009 this year, and if the issuer were to decide so, the dividends which were not distributed in the previous years.

using the new service provided by the Central Depository, investors that have a bank account will receive their dividends in that account. Otherwise, investors will be able to collect their dividends at the offices of the Romanian Post Office, receive them at home, by postal money order at the post office, depending on the choice of the issuer.

"So far the distribution of the dividends of the various issuers would be done by various methods, whose disadvantages would include high costs for investors and for the issuers", according to the press release by the Central Depository

For instance, investors owning stock in several companies, with each of them opting for a different method of distributing dividends, were required to collect their dividends from each company separately. Many times this required investors to go to several places, leading to wasted time and additional expenses.