Good competitive position in Argentina's financial system, which provides a low-cost diversified deposit base funding; and High liquidity levels in both local and foreign currency. Still very challenging economic conditions in the country, with a contracting economy, high inflation, and uncertainties about the sovereign debt restructuring; Transactional system with very low access to credit and short-term funding; and Lower levels of Tier 1 capital compared to industry average. The CreditWatch negative listing reflects the potential impact that the restructuring of the sovereign debt, foreign exchange controls, deposit base behavior both in local and foreign currency, and other developments related to the new government policies and financial system regulation could have on Banco Galicia and its creditworthiness. We could lower the
