Good competitive position in Argentina's financial system; Strong diversification of business activities relative to the industry; and Extensive franchise supports its adequate funding profile. Relatively risky economic and industry conditions in Argentina; and Weak capitalization. The negative outlook on the bank reflects that of the Republic of Argentina. If we downgrade Argentina, we could lower the ratings on all financial institutions that we rate the same as the sovereign. We rarely rate these entities above the long-term rating on the sovereign as they're susceptible to changes in the national economy. Also, a sovereign downgrade could indirectly affect all financial institutions operating in Argentina. A revision to stable on the sovereign outlook will trigger a similar rating action on the bank.
