S&P: Banco BMG on positive watch

Standard & Poor's said it placed its ratings on Banco BMG SA on CreditWatch with positive implications, reflecting the benefits of an improved macroeconomic environment with better access to funding alternatives in Brazil's growing capital markets.

S&P said it expects the CreditWatch to be resolved in one month, after it further evaluates the bank's track record in credit origination, prospects for continued growth, risk management and corporate governance.

The agency noted that the ratings on Banco BMG reflect the risks of significant product concentration, high competition in the market and expected margin pressure on payroll-discount loans and dependence on wholesale funding.

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