...Viability Rating Drives IDR: Banco Davivienda's (Davivienda) Long-Term Local and Foreign Currency Issuer Default Ratings (IDRs) are driven by its Viability Rating (VR) of `bbb'. The bank's VR is highly influenced by the operating environments in which its businesses operate. Additionally, the ratings also consider the bank's resilient financial performance and reasonable asset quality metrics, which are underpinned by Davivienda's appropriate risk management and clear long-term strategy. Resilient Financial Performance: Margins are resilient given the bank's retail focus and despite Colombia's declining interest rate environment; adequate cost control, a consolidated franchise and geographical diversification underpin Davivienda's financial performance. However, a trough in the economic cycle and legacy corporate names contributed to asset quality deterioration and underpin the need for additional loss loan provisions and weigh on profitability. Sound Asset Quality: Davivienda's consolidated...
