Banco do Estado do Rio Grande do Sul 'BB-' Global And 'brA-' National Scale Ratings Affirmed; Outlook Still Negative
- Brazil-based, government-owned commercial bank Banrisul continues serving the state of Rio Grande do Sul (RS) and acting as the state's financial agent.
- We're affirming our 'BB-' long-term global scale and 'brA-' national scale issuer credit ratings on Banrisul.
- The negative outlook on the bank reflects our view of the negative trend in Brazil's Banking Industry Country Risk Assessment (BICRA) economic and industry risk and our belief that RS's weak finances could jeopardize the bank's asset quality, revenue, and funding stability.
SAO PAULO (S&P Global Ratings) Nov. 1, 2016--S&P Global Ratings affirmed its 'BB-' long-term global scale and 'brA-' national scale issuer credit ratings on Banco do Estado do Rio Grande do Sul (Banrisul). The outlook on both scale remains negative. The ratings on Banrisul continue to reflect its moderate business position given the higher risk of operating in RS given the state's prolonged weak finances weigh on bank's revenue stability. The ratings also are based on the bank's moderate risk position that reflects deteriorating asset quality, its moderate capital and earnings that stem from a 5.6% forecasted risk-adjusted capital (RAC) ratio for the next 18 months, and its above average funding given its diversified and retail-based structure, and adequate liquidity. RELATED CRITERIA AND RESEARCH Related Criteria
- S&P Global Ratings' National And Regional Scale Mapping Tables, June 1, 2016
- Rating Government-Related Entities: Methodology And Assumptions, March 25, 2015
- Criteria: National And Regional Scale Credit Ratings, Sept. 22, 2014
- Group Rating Methodology, Nov. 19, 2013
- Banks: Quantitative Metrics For Rating Banks Globally: Methodology And Assumptions, July 17, 2013
- Revised Market Risk Charges For Banks In Our Risk-Adjusted Capital Framework, June 22, 2012
- Banks: Rating Methodology And Assumptions, Nov. 9, 2011
- Banking Industry Country Risk Assessment Methodology And Assumptions, Nov. 9, 2011
- Bank Capital Methodology and Assumptions, Dec. 6, 2010
- Use Of CreditWatch And Outlooks, Sept. 14, 2009
Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at www.standardandpoors.com for further information. Complete ratings information is available to subscribers of RatingsDirect at www.globalcreditportal.com and at www.spcapitaliq.com. All ratings affected by this rating action can be found on the S&P Global Ratings' public website at www.standardandpoors.com. Use the Ratings search box located in the left column.
| Primary Credit Analyst: | Mariana Gomes, Sao Paulo (55)-11-3039-9765; mariana.gomes@spglobal.com |
| Secondary Contact: | Guilherme Machado, Sao Paulo (55) 11-3039-9754; guilherme.machado@spglobal.com |
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