The ratings on Guatemala-based bank, BI, reflect its "strong" business position in the under-penetrated Guatemalan banking system, our expectation for "moderate" risk-adjusted capital (RAC) ratios and earnings capacity, and a "moderate" risk position. The ratings also reflect its "average" funding and "adequate" liquidity (as our criteria define these terms). Our bank criteria uses the Banking Industry Country Risk Assessment's (BICRA) economic and industry risk scores to determine a bank's anchor, the starting point in assigning an issuer credit rating. The anchor for a commercial bank operating in Guatemala is 'bb+'. Our economic risk score of '7' on Guatemala reflects its limited fiscal flexibility stemming primarily from a low tax base, likely higher debt over the next several years, the absence
