Strong business diversification, with substantial presences in Italy, Bavaria, Austria, and several CEE countries; The potential to reap the fruits of future growth in CEE; Prudent capital policy; and Satisfactory profitability of the Italian and CEE businesses. Low profitability of the German and Austrian operations; Exposure to the weak German real estate market; Temporary weakening of consolidated capital ratios after the acquisition of HVB; and High execution risk in creating a European banking group, operating in a variety of regulatory and economic contexts. The ratings on Italy-based banking group UniCredito Italiano SpA (UniCredito) reflect its strong business and geographic diversification in the group's core markets of Italy, Germany, and Austria; a strategic presence in fast-growing countries in Central and Eastern
