...Second-Tier Dom estic Franchise: BPER Banca S.p.A.'s (BPER) ratings reflect its sound second-tier multi-regional domestic franchise as w ell as improved, but modest, operating profitability. Ratings also factor in significant progress in reducing impaired loans, w hich reduced capital encumbrance from unreserved non-performing loans (NPLs). Unipol Banca Acquisition: The acquisition of Unipol Banca (BB+/Rating Watch Negative/b/Rating Watch Positive) w ill not fundamentally alter BPER's credit profile and w ill contribute to reinforcing its domestic franchises as a second-tier bank in Italy. Fitch Ratings sees limited execution risks in integrating Unipol Banca given its limited size and BPER's experience in integrating smaller banks. Additionally, BPER expects to generate synergies that w ill support the group's 2019-2021 strategic plan execution. Below -Average Asset Quality: In 2018, BPER disposed around EUR3 billion of NPLs, equal to almost one third of its stock. The pro forma impaired...
