S&P Global Ratings on March 29 lowered Banco Mercantil Santa Cruz SA's long-term issuer credit rating to BB- from BB, while affirming the short-term rating at B.

The outlook is stable.

S&P also revised the bank's capital and earnings assessment to weak from moderate, based on an average risk-adjusted capital ratio forecast of between 4% and 4.5% for the next two years, following the completion of Banco Mercantil's acquisition of Banco PYME Los Andes ProCredit SA.

The rating agency noted that an absence of loss-absorption features at the bank led to a fall in its risk-adjusted capital ratio. The stable outlook reflects S&P's expectation the bank will maintain the risk ratio between 4% and 4.5%, mainly reflecting sustained internal capital generation to support its growth strategy.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.