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Fitch affirms ProCredit Colombia ratings with stable outlook

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Fitch affirms ProCredit Colombia ratings with stable outlook

Fitch Ratings on April 11 affirmed Banco ProCredit Colombia SA's long- and short-term nationalratings at AA+(col) and F1+(col), respectively. The outlook on the long-term ratingis stable.

The ratings action reflects the equity support provided by itsmajority shareholder, ProCredit HoldingAG & Co. KGaA, due to the subsidiary's strategic importance to theglobal ProCredit group franchise, Fitch said.

Overall, Fitch believes that the Colombian economic environmentand favorable macroeconomic indicators compared to the broader region also representsan additional factor to reinforce support. Although ProCredit's loan portfolio growthremains negative and has lost 50% of its value since 2013, Fitch expects positivegrowth for 2016.

In addition, the company's management is planning a capitalizationwith fresh resources worth up to 12 billion Colombian pesos, which will allow thefirm to have higher dynamic payouts and therefore a revival of its business, Fitchnoted.

As of April 11, US$1 wasequivalent to 3,093 Colombian pesos.