Viceroy report 'baseless, filled with factual errors' - Capitec

Cape Town - Capitec has responded to a new research report by US short sellers Viceroy Research, which caused its share price to decrease by 19.6% at noon, by saying that it was filled with “factual errors.”

In a market report the SA bank said that its corporate governance was “strong and our communications and disclosures are, and always have been transparent, clear and to the point”.

Viceroy came to prominence for SA investors after it released a report into embattled retailer Steinhoff, shortly after the Stellenbsoch-headquartered firm’s share price tanked amid an accounting scandal. 

In its new 33-page report uploaded to its website at about 10am on Tuesday, Viceroy alleged that Capitec was using new loans to repay existing loans. 

It said Capitec may have to write off a total of R11bn in bad loans, and called for the bank to be placed under curatorship by the SA Reserve Bank. 

The central bank, however, on Tuesday said that Capitec "is solvent, well capitalised and has adequate liquidity".

'Baseless'

In a separate media statement on Tuesday, the bank's CEO Gerrie Fourie said he strongly refuted Viceroy's allegations, adding that Capitec was "in the process of gathering information to respond to the claims made in the report with facts".

"We are committed to providing clear and transparent information that will show that these claims are baseless," said Fourie. 

Capitec said it received a copy of the research report at 10am on Tuesday. 

"Shareholders are advised that Capitec has not been approached by Viceroy for insight into our business and none of their allegations have been discussed, tested or verified with management," it said. 

The group said the report was, on the face of it, “filled with factual errors, material omissions in respect of legal proceedings against Capitec and  opinions that are not supported by accurate information”. 

The bank said it was reviewing the report would respond later in detail.

It has since scheduled a media briefing for Tuesday afternoon between 16:00 and 18:00, but has not as yet given an exact time for when it will take place.

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