The ratings on Banche Popolari Unite (BPU) reflect the group's strong business profile, which benefits from good penetration rates 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 in the rich central and northern regions of Italy), loyal customer base, and large deposit base. It combines retail banking and corporate banking activities. The group has exposure to midsize and large corporates also through the loan book of Centrobanca, the group's merchant bank, which represents 11% of total group lending. BPU's loan portfolio is concentrated by borrower, with the top 20 nonfinancial exposures totalling about 160% of the group's
