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Fitch Expects to Rate Banco de Credito e Inversiones' 10-Year USD500MM Sr. Unsecured Bonds 'A-'
October 6, 2017 / 5:48 PM / 2 months ago

Fitch Expects to Rate Banco de Credito e Inversiones' 10-Year USD500MM Sr. Unsecured Bonds 'A-'

(The following statement was released by the rating agency) SANTIAGO/NEW YORK, October 06 (Fitch) Fitch Ratings has assigned an expected Long-Term Foreign Currency rating of 'A-(EXP)' to Banco de Credito e Inversiones's (BCI) 10-year USD500 million senior unsecured fixed-rate bonds due 2027. KEY RATING DRIVERS VIABILITY RATING, ISSUER DEFAULT RATING AND SENIOR DEBT BCI's affirmation considers Fitch's assessment regarding the adequate management of execution risks and impact over the past few months of the acquisition of City National Bank in the U.S. on BCI's overall financial strength. BCI's IDRs are also driven by its strong domestic franchise, sound balance sheet and liquidity management, improved asset quality, ample funding sources, and its relatively high profitability over the past few years, although this last has been pressured recently. The rating assigned to BCI's new debt issuance corresponds to the bank's long-term IDR and ranks equal to its other senior unsecured debt, considering the absence of credit enhancement or subordination feature. For more information on BCP's ratings, refer to "Fitch Affirms Banco de Credito e Inversiones' IDR at 'A-'/Outlook Positive," dated Nov. 8, 2016, available at www.fitchratings.com. RATING SENSITIVITIES IDRs, VR, AND SENIOR DEBT The Outlook for the Long-Term IDRs and National rating is Positive. Resolution of the Positive Outlook sometime in the next six-12 months could be driven by BCI sustaining proven capital metrics amid a tougher operating environment while maintaining solid profitability and asset quality ratios. This would mean an FCC /RWA ratio consistently above 9.5%; sustaining operating profit/RWAs above 1.5%, and NPLs consistently below 2.0%. The rating could also benefit if the bank is able to sustain and continue growing its franchise, along with its ample liquidity and funding position. The Outlook could be revised to Stable if there are significant pressures on BCI's financial performance or if financial metrics described above do not perform as expected. The senior unsecured debt rating would generally move with bank's long-term rating. The rating of BCI's USD500 million senior unsecured fixed-rate bonds due 2027 would move in tandem with the bank's IDRs. Fitch currently rates BCI as follows: --Long-Term Foreign and Local Currency IDRs at 'A-'; Outlook Positive; --Viability rating at 'a-'; --Long-term Foreign Currency senior unsecured at 'A-'; --Long-term National rating at 'AA+(cl)'; Outlook Positive; --Long-term National rating senior unsecured bonds at 'AA+(cl)'; --Long-term National rating subordinated bonds at 'AA-'; --Short-Term Foreign and Local Currency IDRs at 'F1'; --Support Rating at '1'; --Support Rating Floor at 'A-'; --Short-term National rating at 'N1+(cl)'; --National equity rating at 'Primera Clase Nivel 1'. Contact: Primary Analyst Mark Narron Director +1-212-612-7898 Fitch Ratings, Inc. 33 Whitehall St. New York, NY 10004 Secondary Analyst Abraham Martinez Director +562-2499-3317 Committee Chairperson Veronica Chau Senior Director +52 81 8399 9169 Date of Relevant Committee: Nov. 7, 2016 Media Relations: Benjamin Rippey, New York, Tel: +1 646 582 4588, Email: benjamin.rippey@fitchratings.com. Additional information is available on www.fitchratings.com Applicable Criteria Global Bank Rating Criteria - Effective from 15 July 2016 to 25 November 2016 (pub. 15 Jul 2016) here Additional Disclosures Solicitation Status here#solicitation Endorsement Policy here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEB SITE AT WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA, AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE, AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE CODE OF CONDUCT SECTION OF THIS SITE. DIRECTORS AND SHAREHOLDERS RELEVANT INTERESTS ARE AVAILABLE here. 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The manner of Fitch’s factual investigation and the scope of the third-party verification it obtains will vary depending on the nature of the rated security and its issuer, the requirements and practices in the jurisdiction in which the rated security is offered and sold and/or the issuer is located, the availability and nature of relevant public information, access to the management of the issuer and its advisers, the availability of pre-existing third-party verifications such as audit reports, agreed-upon procedures letters, appraisals, actuarial reports, engineering reports, legal opinions and other reports provided by third parties, the availability of independent and competent third- party verification sources with respect to the particular security or in the particular jurisdiction of the issuer, and a variety of other factors. 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