Fitch Affirms Banco de la Nacion Argentina's (Sucursal Uruguay) IDRs at 'CCC'
KEY RATING DRIVERS - IDRS & SUPPORT RATING
BNAUY's IDRs are aligned with the Republic of Argentina's sovereign ratings as it is an integrated branch of Banco de la Nacion Argentina (BNA), fully owned by the Argentine government. BNA's liabilities (including its branches abroad) are guaranteed by the sovereign.
Argentina's sovereign FC IDR of 'RD' reflects the current default status of certain debt securities affected by a court ruling. However, in Fitch's view, Argentina's payment capacity for its LC and FC debt securities issued under Argentina's Law is 'CCC'.
BANUY's support rating of '5' considers that external support, although possible, cannot be relied upon given Argentina's weak credit profile.
BNAUY is the smallest bank in Uruguay. As of Dec. 31, 2014, the bank has a 0.76% and 0.82% share of total assets and deposits of private banks, respectively. BNAUY's main function is to facilitate foreign trade between Argentina and Uruguay.
BNA's creditworthiness is intrinsically aligned with that of the sovereign, given the existing explicit guarantee and its systemic importance. BNA is the largest commercial bank in Argentina, with 30% deposit and 19% loan market shares, with the largest nationwide coverage, and is a leader in most business lines.
RATING SENSITIVITIES - IDRS & SUPPORT RATING
BNAUY's ratings are sensitive to changes in Argentina's sovereign rating and/or willingness to provide support to BNA and its branches.
Fitch has affirmed the following ratings:
BNAUY:
-- Long-term foreign currency IDR at 'CCC';
-- Long-term local currency IDR at 'CCC';
-- Support rating at '5'.
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