Banca Mifel S.A.

Long-standing customer relationships in its niche market; and Enhanced internal capital generation that supports adequate capitalization. Small market share in the Mexican banking industry; Single-name and geographic loan concentrations; and Concentrated wholesale deposit base. The negative outlook on Banca Mifel S.A. reflects our expectations that we could lower the ratings in the next 12 months if the negative trend in Mexico's economic risk trend materializes. Stemming from our view that weaker economic prospects and falling investor confidence could take a toll on operating conditions of domestic banks--including Banca Mifel--and could undermine their asset quality. A revision of the Banking Industry Country Risk Assessment (BICRA) to a lower category would result in a lower anchor for banks operating in Mexico (currently

...Concentrated wholesale deposit base. Outlook: Negative The negative outlook on Banca Mifel S.A. reflects our expectations that we could lower the ratings in the next 12 months if the negative trend in Mexico's economic risk trend materializes. Stemming from our view that weaker economic prospects and falling investor confidence could take a toll on operating conditions of domestic banks--including Banca Mifel--and could undermine their asset quality. A revision of the Banking Industry Country Risk Assessment (BICRA) to a lower category would result in a lower anchor for banks operating in Mexico (currently at '###'). This could prompt us to lower Banca Mifel's stand-alone credit profile (SACP) and issuer credit rating (ICR)....

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