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Moody's assigns ratings to Banco Patagonia Uruguay

Moody's on April 29 assigned long- and short-term global local and foreign currency deposit ratings of Ba3and Not Prime, respectively.

The bank was also assigned national scale local and foreigncurrency deposit ratings of A2.uy, as well as long- and short-term globalcounterparty risk assessments of Ba2(cr) and Not Prime(cr), respectively. Itreceived a baseline credit assessment, or BCA of "b1," and anadjusted BCA of "ba3."

The bank's global local and foreign currency deposit ratingsare derived from its "b1" baseline credit assessment and a one-notchuplift from the high probability that the bank's indirect owner, , wouldprovide support in case of financial stress. The negative outlook on the bankis in line with the negative outlook on Banco do Brasil, which indirectlycontrols the Uruguayan bank through Banco Patagonia SA.

Banco Patagonia Uruguay's ratings also reflect its limitedearnings generation capacity as it simply reinvests deposits from Argentineclients in highly liquid investments. Consequently, net income has average just0.37% of tangible banking assets in the last three years. Moody's notes thebank is well-capitalized, with a tangible common equity-to-risk-weighted assetsratio of 21.6% as of December 2015. However, its rating is still constrained byties to its immediate parent, Banco Patagonia.