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Fitch affirms Grupo Security, 2 subsidiaries

Fitch Ratings on May 31 affirmed multiple ratings of Factoring Security SA, Banco Security SA and both companies' parent Grupo Security SA, while maintaining the positive outlook on the companies.

Banco Security's long and short-term deposit ratings were affirmed at AA-(cl) and N1+(cl), respectively. Grupo Security's solvency rating was affirmed at A+(cl). Factoring Security's long and short-term solvency ratings were affirmed at A+(cl) and N1+(cl), respectively.

Banco Security's ratings reflect its intrinsic solvency, which is highly influenced by its smaller company profile relative to local peers, and lower capitalization, though Fitch notes this had improved in 2016. The bank has a moderate risk appetite, with asset quality metrics consistent with its strategy and target market. The ratio of loans 90 days past due of total loans has remained stable at 1.5% over the last three years despite modest loan growth.

Grupo Security's ratings reflect individual financial debt indicators that are higher than other local financial holding companies, as well as dividend flows that are forecast to reach about 46.81 billion Chilean pesos in 2017. The group also has high credit quality with low risk of financial assets.

Factoring Security's ratings reflect Grupo Security's ability and willingness to provide support if required. Fitch believes the likelihood is high, given the alignment of Factoring Security's business image with the parent, plus its consistent track record of contributing to group results.

The positive outlook on Banco Security reflects the possibility of an upgrade in the next 12 to 24 months if there is a sustained maintenance of capital metrics in a more difficult operating environment, while the positive outlook on Grupo Security is in line with the bank, which is its main investment. The positive outlook on Factoring Security is in line with the parent, Fitch said.

As of May 31, US$1 was equivalent to 673.10 Chilean pesos.