PicS ($PICS) IPO Credit Risk Disclosure Case

• $PICS investors filed a claim against PicS for hiding worsening credit quality, loan reclassifications, and higher default risk before and during its IPO.

• After PicS disclosed a major reclassification of loans into credit-impaired status and later reported further credit deterioration, $PICS fell more than 50% by June 4, 2026.

• $PICS investors can join this case to be notified about potential recovery.

Case Details:

Between January 29, 2026 and June 4, 2026, PicS stated its credit business was supported by strict underwriting standards, proprietary credit data, and improved credit models.

The company highlighted strong loan adoption, customized credit scoring models, and a Stage 3 formation rate of 3.6% as of September 30, 2025.

However, internal reviews in December 2025 identified deficiencies in credit procedures that were not disclosed. About R$590 million of loans were reclassified from Stage 2 to Stage 3 before the IPO, resulting in an R$88 million expected credit loss charge.

Stage 3 formation had also increased above 7% in the fourth quarter, indicating faster deterioration than reported.

On March 19, 2026, the company disclosed the R$590 million loan reclassification and the related R$88 million increase in expected credit losses.

On June 2, 2026, additional updates showed Stage 3 loans had increased to 13% of the credit portfolio.

By June 4, 2026, shares had fallen below $9, representing a decline of more than 50% from the IPO price.

Based on these events, $PICS investors filed a case against PicS, stating that the company:

• Hid worsening credit quality ahead of and during the IPO.

• Overstated the strength of its credit models and underwriting practices.

• Did not fully reflect rising default risk in its loan portfolio.

Investors argue PicS misrepresented the quality of its credit portfolio and risk controls, leading to losses when the deterioration became visible.