The ratings on Italy-based Banche Popolari Unite (BPU) reflect the group's strong business profile as the result of a good penetration in the wealthiest regions of Italy. The ratings also reflect an adequate financial profile, which is characterized by strong liquidity, good revenue-generating capacity, adequate--albeit weakened--asset quality, and relatively weak capitalization. BPU--the result of the 2003 merger between Banca Popolare di Bergamo – Credito Varesino (BPB-CV) and Banca Popolare Commercio e Industria SCRL (BPCI)--leverages on favorable geographical coverage (mainly the rich central and northern regions of Italy), a loyal customer base, and a large deposit base. The group concentrates on retail banking, although the loan book is also exposed to midsize and large corporate credit risk. This risk is mainly
