Core subsidiary of Banco de Credito del Peru (BCP); Long track record and good market position in the Peruvian micro-lending sector; and Adequate risk-adjusted capitalization. Higher-than-average credit losses in 2014 due to due the challenging environment in the Peruvian microfinance sector; and Moderate diversification of business activities due to heavy weight on micro lending. Our negative outlook on MiBanco reflects the negative trend in our Banking Industry Country Risk Assessment (BICRA) of Peru, and because we could lower our rating on BCP and MiBanco if we lower our BICRA on Peru. The negative trend in the BICRA is mainly due to the rising economic risk for banks operating in Peru, given the rapid growth in credit and private-sector leverage in
