Capitec Bank Holdings fell by as much as 20 percent in trading on Tuesday after Viceroy Research, the opaque organisation that brought down Steinhoff with allegations of irregularities, targeted the company in a new research report.
Bloomberg reported that Capitec has been South Africa's best-performing stock over the past decade, until it fell more in one morning than it had in 15 years. Before Tuesday's losses, Capitec's stock had risen 30-fold since 2008.
Capitec was founded in 1999 and focuses on the lower end of the market, providing affordable banking services to "unbanked" South Africans.
André du Plessis, Capitec's chief financial officer, is quoted by Bloomberg as saying allegations contained in Viceroy's report are "totally unfounded" and that there is "a total lack of understanding of what we do". According to the report, Capitec might be concealing losses by extending loans to individuals who can't afford them.
Moneyweb quotes the report as labelling Capitec as "a wolf in sheep's clothing". It quotes Capitec CEO Gerrie Fourie as saying the company has taken note of the report and will respond "appropriately".
According to the site, Viceroy's Fraser Perring admits they have shorted Capitec and that they consider the company "uninvestable".
This is a developing story.