JOHANNESBURG – Capitec’s executives have briefed the media in response to a Viceroy report claiming the bank is operating like a loan shark which is quick to lend money.
On Tuesday, US-based fund manager Viceroy questioned Capitec’s ability to survive, saying its business model is not sound.
Capitec Bank says a report by Viceroy that its financially unstable is riddled with inaccuracies.
Capitec CEO Gerrie Fourie says the report is nonsense and the bank has responsible lending practices.
“If you look at our risk appetite or the way we analyse clients, we’re very strict on affordability. Our behavioural model also looks at clients’ behaviour, including internal, external and banking behaviour.”
Fourie says they’re deeply concerned about the integrity of Viceroy’s report.
He says after they received the report on Tuesday morning, they weren’t approached by the US-based fund manager for insight into the business.
The Capitec CEO adds that they believe the bank’s corporate governance is strong and its communications and disclosures are transparent, clear and honest.
He says the report is full of factual errors and material omissions in respect of legal proceedings.
Meanwhile, economists say customers banking with Capitec Holdings have nothing to worry about.
Chief economist at Econometrix Azar Jammine explains: “I do believe that people should be confident that their money is fine. The time for Capitec to have go under was the time when African Bank went bust.”
Pan African Investment and Research chief economist Iraj Abedian says when it comes to banking, the statement by the South African Reserve Bank (Sarb) should be trusted.
“People must be absolutely confident that if the Reserve Bank doesn’t get it right then nobody else can. They have proven themselves, since 2009, our banking regulatory system is one of the best in the world.”
Sarb says that according to all the information available, Capitec is solvent, well capitalised and has adequate liquidity, adding that the bank meets all prudential requirements.