European Central Bank could use Steinhoff mess to improve QE

The Steinhoff controversy could be a chance for the European Central Bank to rethink its bond-buying programme.


The institution is facing a possible loss after acquiring the South African retailer’s debt as part of its so-called quantitative easing. The ECB could reduce the chances of a repeat, Reuters reports.

The 800 million euro bond issued by a Steinhoff entity in Europe is an eyesore for the central bank. It bought the security in July as part of the QE programme, which is intended to drive down borrowing costs for euro zone companies. Five months later, the bond has fallen to around 50 percent of face value after Steinhoff appointed auditors to investigate accounting irregularities.