Reserve Bank's support for Capitec based on inaccurate information: Viceroy

Reserve Bank's support for Capitec based on inaccurate information: Viceroy”

But Viceroy stepped up its criticism on Monday, saying the SARB should scrutinise Capitec more closely.

Viceroy's latest South African report, titled Capitec: A Wolf in Sheep's Clothing, made damning claims against the micro-lender, calling the bank a loan shark headed for insolvency.

In a five-page statement published to its website on Monday morning, Viceroy took aim at the SARB for vouching for Capitec's financial robustness.

"Viceroy is not regulated in South Africa, and by its own admission, has been trading [short selling] in Capitec shares ahead of the release of its report, and stood to benefit substantially from forcing the Capitec share price to fall by publishing its speculative report about the bank", Treasury said in a statement on Thursday.

"The bank meets all prudential requirements", the SARB said in late January.

Capitec said in its later statement on Monday that the SARB was fully aware of the credit scoring models and the risk targets set when extending credit. We do not think it is.

The firm has renewed a call for the central bank to carry out a full regulatory inspection on Capitec.

Regarding Viceroy's claim that it was misrepresenting R11bn in bad loans, Capitec said: "The Viceroy report presents information that is not clearly comparable and fails to present information that is easily available in the public domain".

The lengthiest rebuttal in Capitec's statement addressed Viceroy's claim that the bank rolled over existing bad debts.

Capitec, in response, said arrears figures it had reported on its loans were accurate and that provisions raised against loans were conservative.

"Rescheduling is an amendment to an existing contract and rescheduled loans are therefore not included as new credit granted or loan sales", it said.

National Treasury also offered support to Capitec, calling the report "reckless".

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