(Bloomberg) -- Banco BTG Pactual SA extended a two-day plunge as new allegations added to an ongoing investigation targeting the Brazilian bank.
BTG’s units slumped as much 30% on Monday as local website O Antagonista said Brazil’s police are investigating allegations that the bank had a department advising clients on money laundering. BTG said in a statement that the report was “absurd” and strongly denied any irregularities.
The bank’s Chief Executive Officer Roberto Sallouti at an impromptu conference call on Monday that he has looked at the allegations against BTG and found “no cause for concern.”
“We’re very calm that over time all will be clarified,” he said.
The Monday report deepened concern with the bank, which had already seen its shares fall 15% late last week as police searched the its offices and the homes of its founder, Andre Esteves. The drop has erased 18.2 billion reais ($4.4 billion) in market , with the units dropping 31% since Friday’s investigation kicked off, to 46.46 reais. The bank’s own brokerage firm accounted for most of the net buying of BTG’s shares on both days, according to data compiled by Bloomberg.
On Friday, BTG said it was cooperating with investigations and that an internal investigation from 2016 found no evidence of misconduct.
“The stock is still being battered by developments in the investigations,” said Luis Sales, an analyst at Guide Investimentos.
Esteves, 51, was arrested in 2015 in the Carwash probe, sparking a crisis at BTG. He was acquitted last year after the prosecutor’s office said there was “no sufficient proof” against him. Since December, he’s been back in the controlling group along with four other partners.
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