S&P raises HSBC Brasil

Standard & Poor's said it raised its foreign currency counterparty credit rating on HSBC Bank Brasil SA (HSBC Brasil) to BB from BB- following the raising of the foreign-currency rating assigned to the Federative Republic of Brazil to BB from BB-.

The foreign and local currency ratings of the bank are now equalized at BB, the agency said, adding the outlook is stable.

The ratings assigned to HSBC Brasil reflect the bank's focus on the consumer finance after the Losango acquisition and middle-market segments and consequent higher exposure to credit risk, the challenge to boost its profitability in a very competitive environment and the inherent risk of operating in Brazil, S&P said.

These risk factors are partially tempered by the benefit of being fully owned by HSBC Holdings plc (A+/positive/A-1), HSBC Brasil's established market position in the consumer finance segment, higher earning potential as a result of change in credit mix toward retail and good liquidity to face unexpected losses or volatility, the agency noted.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.