Strategic shift towards less risky business segments; and Prudent liquidity management. Weaker capitalization levels than those of peers; Concentrated business profile compared with the industry average; and Track record of high credit losses and volatile results. The stable outlook on Banco Fibra S.A. for the next 12 months reflects our expectations that the bank will maintain stable capital levels due to modest credit growth, coupled with return on equity (ROE) of 0%-2%. We expect the bank's capitalization to remain weaker than the industry average, with a risk-adjusted capital (RAC) ratio of 4.0%-4.5% in the next two years. Nevertheless, we expect the bank to maintain its Basel III capital ratio above 11.5% in the same period, above the minimum regulatory requirements.
