London/Frankfurt — Wall Street banks including Bank of America and Citigroup are facing potential losses of more than €1bn on loans made to Christo Wiese, the billionaire backer of Steinhoff International, the SA-based home retailer whose shares collapsed last week after disclosing accounting irregularities. The banks lent €1.6bn to then Steinhoff chairman Christo Wiese in September 2016, which was secured against €3.2bn worth of Wiese’s shares in the company, according to public documents issued by Steinhoff. However, the value of Wiese’s shares pledged against the debt has plummeted sharply with the 80% plunge in Steinhoff’s share price, which has wiped €10bn off its market capitalisation since last Tuesday. This has left the value of the stock held against the loans at less than €400m.That means Wiese’s collateral on the margin loan — which allowed him to borrow money to invest using his shares as security — is worth far less than his debt to the banks. Wiese, who stood down as h...

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