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Fitch notes high probability of failure for Venezuela's Banco Exterior

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Fitch notes high probability of failure for Venezuela's Banco Exterior

Fitch Ratings on Jan. 15 withdrew its ratings on Venezuela-based Banco Occidental de Descuento Banco Universal CA, Banco Nacional de Crédito CA Banco Universal and Banco Exterior CA Banco Universal for commercial reasons.

The withdrawn ratings include the three banks' CC long- and C short-term foreign and local currency issuer default ratings.

Banco Occidental and Banco Nacional's national long- and short-term ratings of BBB-(ven) and F3(ven), respectively, were also withdrawn, as were their viability ratings of "cc." Banco Exterior's national long-and short-term ratings of A-(ven) and F2(ven), respectively, and its viability rating of "c" were withdrawn too.

Fitch said it withdrew the national ratings without resolving their Rating Watch Negative status due to difficulties in properly determining creditworthiness relative to other Venezuelan issuers.

"The distortion of financial indicators from hyperinflation further exacerbates the challenges for Fitch to differentiate national ratings in this country," the rating agency added.

Commenting on Banco Exterior, Fitch said the lender has a "high probability of failure" since it has required extraordinary capital injections from shareholders to meet minimum capitalization requirements.