...Moderate Risk Appetite, Sound Capitalisation: The ratings of Caja Rural del Sur, Sociedad Cooperativa de Credito are driven by its moderate risk appetite, sound capitalisation, and a stable funding and liquidity profile. They also take into account the bank's small size and regionally concentrated franchise, improving, though still weak, asset quality and modest profitability. Good Regional, Rural Franchise: Caja Rural del Sur is a regional credit cooperative and mainly focuses on lending to households and SMEs in Andalusia. Although its national market share is small (below 1%), it benefits from sound market shares of loans and deposits in some provinces within its home region, particularly in rural areas. It is also a member of Grupo Caja Rural, an association of Spanish rural credit cooperatives sharing common cooperative values and a limited-size solidarity fund. Improving but Weak Asset Quality: Asset quality remains a weakness despite improvements in 2016 and 1H17. The problem asset...
