Fitch ups Uruguay bank ratings

Fitch Ratings said it has upgraded the long-term foreign currency ratings of foreign-owned Uruguayan banks, HSBC Uruguay and Banco Santander SA, to B from B- following a similar action taken on Uruguay's sovereign ratings.

This action reflects Fitch's view that the current ratings of these banks are constrained by the foreign currency sovereign ceiling in light of their strong foreign parents, which have provided both capital and liquidity support throughout the crisis. Fitch has also changed their support ratings to 4 from 5, denoting a limited probability of support.

While Fitch's view is that there is an increased probability that shareholders will continue to support their subsidiaries amid growing signs of economic stabilization, the assigned support rating also reflects the high level of systemic risk in Uruguay.

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