...Strong Franchise: Banco G&T Continental, S.A. (G&TC) is the main entity of the second- largest banking group in Guatemala. G&TC is a systemically important bank in Guatemala, with a market share that is close to 18% in terms of assets and deposits. In its main lending segment (corporate and commercial loans), its market share increased to 22.7% as of December 2016. Increased Impaired Loans: The deterioration of some large debtors negatively affected G&TC's loan portfolio quality. Since 2012, impaired loans have increased, representing 2.8% of gross loans as of March 2017 (December 2016: 1.7%). Nevertheless, Fitch Ratings expects a lower NPL ratio by year-end 2017 due to the risk management measures taken by the bank. High Exposure to Sovereign Risk: G&TC maintains high exposure to the Guatemalan sovereign (BB/Stable). As of December 2016, securities issued by or guaranteed by the sovereign and central bank accounted for 2.4x equity. Moderate Profitability: G&TC's moderate profitability...
