We are revising our economic risk trend for our Banking Industry Country Risk Assessment (BICRA) on Brazil to negative from stable. Despite the government's current measures to recover investors' confidence and jumpstart the country's economic growth, we consider that its fiscal and monetary measures will pressure households' disposable income and will result in an economic contraction that, in our view, will weaken the banking system's asset quality, credit losses, and profitability. We revised our economic resilience score to "very high risk" from "high risk" to reflect our opinion that Brazil's economic growth prospects have continued to weaken while fiscal debt burden remains high. We also revised our economic imbalances score because we expect the banking system to enter a correction
