Banco G&T Continental S.A.

Our stable outlook on Banco G&TC for the next 12 months mirrors that on Guatemala (foreign currency: BB-/Stable/B; local currency: BB/Stable/B), which constrains our rating on the bank. The outlook also reflects our opinion that Banco G&T will benefit from the economic recovery in Guatemala and will keep increasing its market share and its large deposit base, while it continues improving its efficiency levels. If we downgrade Guatemala in the next 12 months, we would take a similar action on Banco G&TC. An upgrade of Banco G&TC would require that we upgrade Guatemala. We view such a scenario as unlikely in the next 12 months because of the economic slowdown in the country and its potential harsh impact on Guatemala's

...We expect Banco G&TC's credit origination will continue recovering this year, which coupled with consistently improving efficiency will lead to steady profitability. We think Banco G&T Continental S.A.'s (Banco G&TC's) focus on and large market share in the corporate segment in Guatemala will enable the bank to remain the third largest player in terms of assets and deposits in the country. In our view, the bank will benefit from its diverse investments in recent years and its loan growth will speed up. This, along with a persistent control cost program, will translate to higher profitability compared to the bank's pre-pandemic levels. We think the bank's large presence in the corporate segment will support its portfolio growth in the next two years, even amid the challenges related to the pandemic recovery. We believe the bank's broad presence will enable it to boost its credit offerings, although we'll monitor how the bank controls a potential additional deterioration of some customers'...

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