Pension funds lost billions over Steinhoff

Markus Jooste is the former CEO of Steinhoff International.
Markus Jooste is the former CEO of Steinhoff International.
Image: Jeremy Glyn

The Government Employees Pension Fund (GEPF) held 428-million shares in Steinhoff with a market value of R24bn at end-November‚ a week before the startling revelations of alleged accounting irregularities led to the collapse of the international retailer’s share price.

As at January 23‚ the GEPF held 392-million shares in the company‚ with a market value of R3bn. Between end November and January 23‚ the share price had fallen from R56.26 to R7.84. At one stage‚ at end-December‚ the value of the GEPF’s stake in Steinhoff fell to as low as R1.8bn.

This information was provided by the fund at a hearing on Steinhoff organised by Parliament’s finance‚ public accounts‚ and public service and administration committees.

Financial Services Board (FSB) deputy executive officer for pensions Olano Makhubela said 948 of the 1‚080 pension funds surveyed — excluding the GEPF and pension funds of state-owned enterprises — had exposure to Steinhoff to the value of R25bn on December 1‚ before the scandal broke. This represented 1.43% of total sampled assets.

By December 8‚ this exposure had fallen to R7bn representing 0.42% of total sampled assets. Thus the pension funds that responded to the survey and had exposure to Steinhoff‚ suffered a loss in value of R18bn or 1% of their total assets.

Individual fund exposures to Steinhoff ranged between 0.01% and 6.04%.

The head of the FSB’s directorate of market abuse Solly Keetse said the board was liaising with other regulators in Europe. It is also investigating two cases of possible insider trading in relation to Steinhoff‚ and one case of possible false‚ misleading or deceptive statements‚ promises and forecasts. All three cases fall under the Financial Markets Act.

Share trades in August and November/December were being investigated.

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