Fitch rates Credito Real BB+

Fitch Ratings said it assigned foreign- and local-currency long-term issuer default ratings of BB+ and short-term issuer default ratings of B to Credito Real SAB de CV Sofom, ENR.

Fitch also said it assigned a national long-term rating of A+(mex) and short-term rating of and F1(mex) to the company.

The outlook is stable.

The ratings reflect Credito Real’s moderate franchise in Mexico’s financial market, its well-proven business model and gradual diversification of its loan portfolio to segments different than payroll loans, the agency said.

The ratings also consider the company’s recurring and sustained profitability ratios that underpin its adequate capitalization metrics amid a high growth strategy, Fitch said, and contained impaired loan ratios that compare favorably against its closest peers.

The ratings are limited by the risk of entry into new businesses and countries and by the wholesale nature of its funding base and the important concentrations of its debt maturities, the agency said.

The ratings also are constrained by the political and operational risks inherent to the payroll-loans segment in Mexico, Fitch added.

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