trending Market Intelligence /marketintelligence/en/news-insights/trending/s5sm_5dqfbejqzywifmrca2 content esgSubNav
Log in to other products

 /


Looking for more?

Contact Us
In This List

Fitch pulls ratings on Venezuela's Banesco amid intervention uncertainty

Blog

Banking Essentials Newsletter: May Edition

Blog

Latin American and Caribbean Market Considerations Blog Series: Focus on IFRS 9

Blog

Banking Essentials Newsletter: April Edition - Part 2

Blog

The Evolution of Cloud Banking: Successful Implementation & Frameworks


Fitch pulls ratings on Venezuela's Banesco amid intervention uncertainty

Fitch Ratings on Dec. 12 withdrew its ratings on Banesco Banco Universal CA, citing uncertainty over when the Venezuelan government's intervention in the bank will be resolved.

Banesco has been subject to a special intervention measure since May, when 11 of the bank's senior executives were arrested on allegations of "aiding and concealing attacks against the Venezuelan currency." The intervention has been extended twice, and the latest extension is effective until March 2019.

Prior to the withdrawal, Fitch downgraded the company's viability rating to "c" from "cc," citing a sharp decline in capitalization ratios to critically low levels in light of hyperinflation.

"In Fitch's view, the probability of failure has increased as Banesco's tangible common equity/tangible assets ratio declined to only 3.8% as of end-June 2018 and its regulatory capital ratio declined to 11.6%, while the minimum required in Venezuela is 11%," the rating agency said.

Other withdrawn ratings include Banesco's long-term foreign and local currency issuer default ratings of CC, short-term foreign and local currency ratings of C, and its national long- and short-term ratings of A-(ven) and F1(ven), respectively.