The ratings on Italy-based Banche Popolari Unite (BPU) reflect the group's strong business profile, which benefits from good penetration in the wealthiest regions of Italy; an adequate financial profile characterized by strong liquidity; good revenue-generating capacity; adequate asset quality; and weak capitalization. The group leverages its favorable geographical coverage (mainly the rich central and northern regions of Italy), loyal customer base, and large deposit base. It concentrates on retail banking, but the loan book is also exposed to midsize and large corporate credit risk. This risk also resides in the loan book of Centrobanca, the group's merchant bank, which represents 12% of total group lending. BPU's loan portfolio is also concentrated by borrower, with the top 20 exposures totaling almost
