South African billionaire Michiel Le Roux loses $173.59 million as Capitec Bank shares fall

The stake of South African billionaire banker Michiel Le Roux in leading lender Capitec Bank has declined by $173.59 million (R2.52 billion) in 40 days as the bank’s shares retreated from an all-time high.

Capitec is South Africa’s largest lender by number of customers. The bank is one of the most reputable banking brands globally, offering transactional banking services and loan products such as term loans, credit facilities and credit cards.

As of press time, 1:10 PM (UTC) today, July 20, shares in the bank were trading at $105.99 (R1,540.27) on the Johannesburg Stock Exchange (JSE), or 63 basis points higher than its opening price of $105.28 (R1,530.00) this morning.

Shares in Capitec have been on a downward trend recently, as investors and bargain hunters sold down stakes to book profits after the share price surged to an all-time high of $11.87 (R170.36) on June 9.

The surge in the bank’s share price can be attributed to a bullish sentiment spiked by investors’ and analysts’ expectations of a stellar rise in its half-year earnings as operations bounced back from a difficult 2020 due to the COVID-19 pandemic.

In a trading update, the bank revealed that its half-year earnings would be more than $226.35 million (R3.3 billion) in the first six months of its accounting year, representing an increase of 292 percent compared with the $57.65 million (R841 million) earned in the corresponding period of 2020.

It also expects earnings per share to be more than $2.32 (R33.72), representing an increase of at least 528 percent compared to the $0.37 (R5.37) per share reported in the previous period ending Aug. 31, 2020.

Profit-taking activities by investors in recent times have caused the market price of Capitec’s shares to fall from its all-time high of $119.05 (R1,730.00) on June 9 to $105.99 (R1,540.27) as of press time today.

The recent decline has led to an 11-percent loss for the bank’s shareholders, including Le Roux, who holds a substantial stake in the leading South African bank.

Le Roux, who founded Capitec in 1999, holds an 11.5-percent equity interest in the bank. His stakes account for 13,296,153 ordinary shares.

Research by Billionaires.Africa revealed that since June 9 the value of his stake has dropped from $1.582 billion (R23.00 billion) to $1.409 billion (R20.48 billion) as of press time today. This translates to a loss of $173.59 million (R2.52 billion) for the billionaire banker in 40 days.

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