Viceroy says it has found that Capitec has been advising and approving loans to delinquent customers in order to repay existing loans.
The Viceroy research group has called on the Finance Minister and the South African Reserve Bank to immediately place Capitec under curatorship after branding the bank as a “loan shark with massively understated defaults – masquerading as a community finance provider”.
The US-based research organisation also produced the report that blew the lid on the accounting fraud at Steinhoff last year.
In its latest report released on Tuesday morning, Viceroy says it has found that Capitec has been advising and approving loans to delinquent customers in order to repay existing loans.
The research group further states that there’s no operational difference between Capitec and the likes of African Bank, which went under due to reckless lending.
Viceroy says that it compiled its report based on information from former Capitec employees, customers and people familiar with the business.
Shares in Capitec Holdings fell more than 10% in mid-morning trade after the group said the South African lender overstates its financial assets and income.
By 1021 GMT, Capitec stock had dropped 10.04% to 836.08.
Capitec’s Chief Financial Officer Andre du Plessis dismissed the report, saying the allegations were “totally unfounded”.
“It’s very surprising that someone writes a report who knows nothing about us. There’s a total lack of understanding of what we do,” Du Plessis told Bloomberg TV.