The stable outlook on UniCredit mirrors that on Italy and reflects our view that the bank's credit profile will remain resilient over the next two years. We anticipate the bank's RAC ratio will remain above 7%, supported by gradual recovery in its profitability, while asset-quality metrics moderately deteriorate amid less favorable economic conditions in the main areas where it operates. We could lower the ratings on UniCredit if we lowered the long-term rating on Italy. Given the bank's exposure to Italy, we consider that UniCredit would not withstand a hypothetical scenario of sovereign default. We could raise the long-term ratings by one notch if we upgraded Italy and concluded that economic risk in the country had decreased, helping UniCredit to
