Fitch downgrades Banrisul

Fitch Ratings said it downgraded Banco do Estado do Rio Grande do Sul SA’s (Banrisul) long-term issuer default ratings to B+ from BB- and national long-term rating to A-(bra) from A+(bra).

The outlook remains negative.

Banrisul's downgrade reflects the ongoing worsening of the economic and operating environment in the state of Rio Grande do Sul, where the bulk of the bank's operations are concentrated, Fitch explained.

The agency said it has negative view on Banrisul's operating environment as it is materially weaker and remains under pressure.

Fitch said it believes that the deterioration of the state’s credit profile will not have a material direct and immediate impact on Banrisul's financial profile, but the worsening environment in the bank's core market will likely translate gradually on negative trends in terms of asset quality, earnings and capitalization.

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