CAPE TOWN - Japanese financial holding company, Nomura has joined the growing list of banks that have been blazed by the collapse of international retail holding company, Steinhoff.
The casualty comes after the financial holding company released its fiscal third-quarter earnings on Thursday, revealed a R1.5 trillion unidentified margin loan.
The shortfall is reportedly linked to Steinhoff.
In January, US banks disclosed more than R11.9 billion of mark-to-market losses and charge-offs on margin loans related to Steinhoff.
In 2016, Nomura was among international banks that provided a R22.7 billion margin loan, backed by 628 million Steinhoff shares that were pledged by the company’s chairperson, Christo Wiese.
Notably, shares of the retailer fell more than 80% since December 5, following accounting irregularities that were uncovered.
According to its earnings presentation, Nomura’s loss was also shared by its operations in Europe and Asia, excluding Japan.
The loss resulted in a drop in the Tokyo-based firm’s overseas pretax profit, which shrank to ¥1.7bn from ¥31.4bn a year earlier.
Meanwhile, SA central bank announced on Wednesday that it is investigating whether Steinhoff had breached any exchange control laws or regulations.
The bank said in a statement to the parliamentary committee, that it would cooperate with local and international regulators as well as law enforcement authorities investigating Steinhoff.
However, if Steinhoff were to collapse, it would not result in financial instability, said the bank.
Steinhoff’s subsidiary Conforama in France said its financing position has been secured and it has a commitment letter signed for an asset-based lending facility of 115million (R1.69billion).
The execution was expected along with first drawdown. In addition it has sold a non-core asset, a 17percentstake in Showroomprivé to Carrefour, which was announced on January 11 for net proceeds of 79m.
In the UK, Steinhoff has managed to raise £260m (R4.36bn), an increase from the £180m of new funding announced on January 3.
- BUSINESS REPORT ONLINE