The ratings reflect UniCredito Italiano's strong domestic market position, credible strategy, and sound financial profile. The bank has maintained a low-risk profile and superior earnings capacity in a difficult operating environment, despite the challenges related to its expansion strategy in Eastern Europe. Although this expansion exposes UniCredito to much higher economic and industry risk than that seen in the Italian system, Standard&Poor's acknowledges the positive results achieved thus far, particularly at 53.2%-owned Polish subsidiary Bank Pekao S.A. Furthermore, given UniCredito's effective "hands on" approach in its acquisition, integration, and restructuring of leading local banks--and the targets set by management in this area--these investments are not expected to weaken the group's overall risk profile. Among the top three banks
