... IDRs are driven by its VR, which is in turn highly influenced by the sovereign rating given Banrural's significant exposure to the public sector. Banrural's VR reflects the bank's solid credit quality metrics, high profitability and, good capitalization. Weaker Operating Environment: The operating environment has a high influence on Banrural's VR. Changes in Guatemala's operating environment have a strong influence on the Bank's financial profile. Public Sector Exposure: Banrural's funding structure is based on a diversified, low-cost deposit base. Banrural maintains moderate exposure to public sector deposits (22% of total deposits), and significant concentration in government bonds (54% of total investments). The Guatemalan government also holds a 17.2% stake in Banrural. Good Credit Quality: Banrural's good credit quality reflects the bank's adequate underwriting practice; effective collection process and employee incentive programs to...
