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Fitch: BTG Pactual remains resilient to Lava Jato probe

The present liquidity and funding profile of Banco BTG Pactual SA is strong and has been able to withstand the recent bad news about the bank, Fitch Ratings said in a Sept. 17 report.

Following the Brazilian federal police's raid on the investment bank's headquarters and addresses belonging to founder and former CEO Andre Esteves, the rating agency has been keeping an eye on the cash flow, funding position, and inflows and outflows to assets under management on a day-to-day basis.

According to Fitch, these positions remain at acceptable levels to maintain the current ratings of the bank.

The rating agency added that it "continues to monitor the bank closely and any significant worsening of its liquidity and funding profile or other key financial indicators could lead to a downgrade of ratings, but the likelihood of this scenario is seemingly low and declining, based on the stable condition in the few weeks [after] the recent negative news."

Analysts note that BTG Pactual has worked to revamp its business model, with the bank opting for a more resilient business model.

News of the recent raids impacted the company's shares as it marked a sort of déjà vu moment of 2015, but the largest Latin American investment bank has decreased its reliance on the confidence-sensitive market funds that caused its previous liquidity crunch.