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By Francesco Canepa
FRANKFURT (Reuters) - The European Central Bank sold its bonds of scandal-hit South African retailer Steinhoff last week, data showed on Monday, potentially losing more than half the amount it had invested.
Steinhoff, the owner of brands such as Conforama and Poundland, revealed "accounting irregularity" last month.
The ECB was facing the risk of having its investment, a small item in its 2.55 trillion euros ($3.05 trillion) scheme, wiped out or converted into shares.
At one point last week, Steinhoff's bond was worth as little as 45 percent of the value at which it was issued last July, when the ECB bought it.
But the credit, which was still part of the ECB's holdings on Jan 2, no longer featured on a list of published on Monday. The ECB does not disclose the price at which it buys or sells its investments.
The ECB's purchases of credit, a small but growing component of its quantitative easing scheme, are aimed at lowering borrowing costs for entrepreneurs but critics say they enrich large companies while endangering the public purse.
The central bank does not pick companies and instead aims to buy bonds in proportion to the amount outstanding on the market, provided that they are denominated in euros and issued by firms that are rated as "investment grade" and are not banks.
Steinhoff's finance chief stepped down last week to focus on helping the retailer plug the hole in its finances.
Turnaround specialist AlixPartners was called in last month to help shore up finances as lenders have started restricting access to credit lines and insurers are cancelling or reducing credit insurance.
($1 = 0.8355 euros)
(Reporting By Francesco Canepa; Editing by Balazs Koranyi)
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