Mibanco - Banco de la Microempresa S.A.

The stable outlook on Mibanco reflects the outlook on its parent, Banco de Credito del Peru (BCP), since the former is a core subsidiary of the group. The stable outlook on BCP for the next two years, in turn, mirrors the outlook on Peru. We expect that the ratings on BCP will move in tandem with those on the sovereign because of BCP's high exposure to the domestic market. We rarely rate financial institutions higher than the sovereign where they operate because we consider it unlikely that these institutions would remain unaffected by developments in domestic economies. On the other hand, if higher risks materialize, damaging the operating conditions for banks in Peru--indicated by a downward revision of the Banking

...We think Mibanco - Banco de la Microempresa S.A. will continue to benefit from the support of its parent. We see Mibanco as a core subsidiary of Banco de Credito del Peru (###-/Stable/A-3). Therefore, we equalize our Mibanco ratings with the '###-' group credit profile for Banco de Credito del Peru. Mibanco will maintain its stable intrinsic creditworthiness over the next few years. The bank's '##+' stand-alone credit profile (SACP)--which is our view of its creditworthiness based solely on its own merits and excluding group support--reflects its leading market position in the Peruvian microfinance sector, its healthy earnings prospects, and its solid capital levels for absorbing temporary pressures on asset quality. Moreover, Mibanco has an adequate funding and liquidity base, in line with the average for the Peruvian banking system....

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