Strong business position within the Peruvian financial system; Sound quality of earnings and earnings capacity; and Adequate capitalization. Still high dollarization in its balance sheet; and Deteriorating Asset quality metrics as a consequence of its exposures in the SMEµcredit. The negative outlook on BCP reflects our view of the negative economic risk trend in our Banking Industry Country Risk Assessment (BICRA) on Peru and the fact we could downgrade the bank if we downgrade the BICRA. This is because we see rising economic risk for banks operating in Peru, stemming from rapid growth in credit and private-sector leverage over the past few years, which has already begun to weaken the Peruvian banks' credit quality. Our assessment recognizes the
