The stake of South African billionaire banker Michiel Scholtz du Pre Le Roux in the South African retail bank, Capitec Bank, has gained $263.41 million (R3.71 billion) in 85 days.
The shares of the leading South African lender have increased by more than 20 percent since April 1, as investors hold on to their stakes in the bank despite a 27-percent decline in its headline earnings during the 2020 accounting year.
In its 2020 audited results, Capitec reported that its headline earnings decreased by 27 percent to $326.24 million (R4.6 billion) from $446.74 million (R6.3 billion) last year on the back of a 78-percent decline for the first six months of the financial year while the country was in a lockdown.
In addition, the lender’s earning power was pressured by a loss of $71,000 (R1.0 million) from its business banking division and a $710,000 (R10 million) amortization expense written-off on the acquisition of the Mercantile Bank group.
Despite this bland performance, the shares in the retail banking group have increased by 20 percent on the Johannesburg Stock Exchange (JSE) since April 1.
At the current share price of $118.56 (R1,668.85) as of press time, 4:00 pm (UTC+1) on June 25, the bank’s market capitalization is $13.71 billion (R192.96 billion) on the JSE.
This valuation makes Capitec the third-largest banking group in South Africa by market capitalization behind Standard Bank and FirstRand Limited.
The shares of the banking group have increased from $98.75 (R1,390.00) on April 1 to $118.56 (R1,668.85) as of press time, 4:00 pm (UTC+1). This amounts to a 20.06-percent gain for shareholders.
Le Roux owns a controlling stake in the bank. He has an ownership stake of 11.5 percent and is one of the institution’s few insiders and directors with significant shareholdings.
The recent gains in Capitec’s shares on the JSE have led the value of the billionaire’s 13,296,153 ordinary shares to increase from $1.31 billion (R18.48 billion) on April 1 to $1.58 billion (R22.23 billion). This puts Le Roux’s gains at $266.52 million (R3.75 billion) in 85 days.
Le Roux is worth $1.5 billion, according to Forbes’s real-time net-worth valuation. He derives the majority of his wealth from Capitec Bank.