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S&P downgrades Banrisul's ratings

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S&P downgrades Banrisul's ratings

S&P Global Ratings on July 11 lowered its long-term global-scalerating on Banco do Estado do Rio Grandedo Sul SA to BB- from BB and its national-scale rating to brA- frombrA+, reflecting its revised moderate business position.

At the same time, S&P removed its ratings from CreditWatchNegative as it now places the outlook at negative.

The bank's moderate business position stems from its concentrationin the state of Rio Grande do Sul. "We believe the weak credit conditions inthe state of Rio Grande do Sul are weakening [Banrisul's] business position andmaking it more vulnerable to management interference," S&P said.

The ratings also reflect the bank's moderate capital and earnings,moderate risk position, above average funding and adequate liquidity.

Meanwhile, the negative outlook reflects S&P's belief thatBanrisul's financials could weaken because of pressures on the financial bankingsystem as a result of the impact of fiscal and monetary tightening in Brazil.

S&P Global Ratingsand S&P Global Market Intelligence are owned by S&P Global Inc.