Dominant franchises in key provinces of wealthy northern Italy. Stable, retail-oriented funding base. Adequate capitalization. Income constrained by very low short-term interest rates. Comparatively high exposure to corporate credit risk. Relatively high single-name loan concentration. The ratings on Italy-based Unione di Banche Italiane Scpa (UBI) reflect Standard&Poor's Ratings Services' view of the bank's strong customer franchise in Lombardy--Italy's richest and most populous region--and its, stable, retail-oriented funding base. UBI's vulnerability to the difficult economic environment in the Italian economy, due to its large exposure to midsize corporations, high sensitivity of revenues to short-term interest rates, and potential risks from relatively high, albeit declining, single-name loan concentration constrain the ratings. Created by the merger of Banche Popolari Unite (BPU)
