Viceroy: Capitec is ‘a wolf in sheep’s clothing’

Viceroy, the group that exposed accounting fraud at Steinhoff, has struck again.

After weeks of speculation about which South African firm it had in its sights, the group on Tuesday  published a report on South African bank Capitec  and the unsecured lender is feeling the heat.

Capitec’s shares were trading down 7.8% on Tuesday at 10:30, after earlier trading down 10%. The best performing share on the JSE over the last ten years has seen a drop of 20% since Friday.

Viceroy came to prominence for South African investors after it released a report into Steinhoff shortly after the Stellenbsoch-headquartered firm’s share price tanked.

In a new 33-page report, published and uploaded to the Viceroy website, the short sellers said they did not buy Capitec’s ‘good news story’.

“Capitec Bank Holdings Limited is a South Africa-focused microfinance provider to a majority lowincome demographic, yet they out-earn all major commercial banks globally including competing high-risk lenders,” the group wrote.

“We don’t buy this story. Viceroy believes this is indicative of predatory finance which we have corroborated with substantial on-the-ground discussions with Capitec ex-employees, former customers, and individuals familiar with the business”.

Update

Capitec responded on twitter that it had taken note of the Viceroy report, and it was in the process of investigating it.

Update 2

On Tuesday afternoon, the South African Reserve Ban announced that Capitec was “solvent, well capitalised and has adequate liquidity”; however, its share price was down 18.98% at R831.

More to follow. –  Fin24

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever. But it comes at a cost. Advertisers are cancelling campaigns, and our live events have come to an abrupt halt. Our income has been slashed.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years. We’ve survived thanks to the support of our readers, we will need you to help us get through this.

To help us ensure another 35 future years of fiercely independent journalism, please subscribe.

Jan Cronje
Jan Cronje
Fin24 Journalist based in Cape Town.
Advertisting

Tension over who’s boss of courts

In a letter, Chief Justice Mogoeng Mogoeng questions whether Justice Minister Ronald Lamola has acted constitutionally

SABC sued over ‘bad’ clip of Ramaphosa

A senior employee at the public broadcaster wants compensation for claims of ‘sabotage’

Soundtrack to a pandemic: Africa’s best coronavirus songs

Drawing on lessons from Ebola, African artists are using music to convey public health messaging. And they are doing it in style

In East Africa, the locusts are coming back for more

In February the devastating locust swarms were the biggest seen in East Africa for 70 years. Now they’re even bigger

Press Releases

New energy mix on the cards

REI4P already has and will continue to yield thousands of employment opportunities

The online value of executive education in a Covid-19 world

Executive education courses further develop the skills of leaders in the workplace

Sisa Ntshona urges everyone to stay home, and consider travelling later

Sisa Ntshona has urged everyone to limit their movements in line with government’s request

SAB Zenzele’s special AGM postponed until further notice

An arrangement has been announced for shareholders and retailers to receive a 77.5% cash payout

20th Edition of the National Teaching Awards

Teachers are seldom recognised but they are indispensable to the country's education system

Awards affirm the vital work that teachers do

Government is committed to empowering South Africa’s teachers with skills, knowledge and techniques for a changing world

SAB Zenzele special AGM rescheduled to March 25 2020

New voting arrangements are being made to safeguard the health of shareholders