Moody's rates Banco BTG notes B1(hyb)

Moody's Investors Service said it assigned a B1(hyb) rating to the dollar-denominated contractual non-viability 7¾% tier 2 subordinated notes issued by Banco BTG Pactual SA's Grand Cayman branch.

The notes amount to $600 million and will be due in 2029 with a call option in five years, Moody's said.

The capital securities are Basel III-compliant, the agency said, and the terms and conditions have been defined so as to qualify them for treatment as tier 2 capital pursuant to Brazilian regulation.

The rating on the hybrids is two notches lower than the adjusted company's baseline credit assessment of Ba2 assigned to Banco BTG Pactual, Moody's said.

The ratings reflect the simplification of the bank's business profile over the past three years, which will improve earnings stability and help to reduce balance sheet volatility, the agency said.

The bank has enhanced its funding and liquidity profile, while increasing its focus on credit and fee-income activities, Moody's said.

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