Fitch affirms GFNorte, Banorte

Following the announcement that it has a Ps. 1 billion exposure to Controladora Comercial Mexicana, a retailer that recently filed for bankruptcy, Fitch Ratings said it has affirmed the ratings of Grupo Financiero Banorte and Banco Mercantil del Norte.

The outlook on their long-term issuer default ratings was revised to stable from positive, the agency said.

According to Fitch, Banorte's exposure to Comerci through unsecured loans does not materially affect its rating fundamentals and both GFNorte and Banorte maintain adequate capitalization, relatively strong profitability and better-than-peers asset quality, although the latter and the proportion of loans funded through customer deposits have been gradually worsening, a trend Fitch expects to continue.

Affected ratings include GFNorte's long-term foreign currency issuer default rating affirmed at BBB, short-term foreign currency issuer default rating affirmed at F3, long-term local currency issuer default rating affirmed at BBB, short-term local currency issuer default rating affirmed at F2, individual rating affirmed at C, support affirmed at five and support rating Floor affirmed at NF. The outlook is stable.

Other affected ratings include Banco Mercantil del Norte's long-term foreign currency issuer default rating affirmed at BBB, short-term foreign currency issuer default rating affirmed at F2, long-term local currency issuer default rating affirmed at BBB, short-term local currency issuer default rating affirmed at F2, individual rating affirmed at C, support affirmed at 2, support rating Floor affirmed at BBB-, national-scale long-term rating, affirmed at AA+(mex) and national-scale short-term rating, affirmed at F1+(mex). The outlook is stable.

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