Fitch Affirms Banco Agropecuario's IDR at 'BBB+'; Outlook Stable

Fitch Ratings has today affirmed Banco Agropecuario's (Agrobanco) Foreign Currency long-term Issuer Default Rating (IDR) and Support Rating Floor (SRF) at 'BBB+', in line with Peru's sovereign rating. Fitch has also affirmed Agrobanco's long-term senior unsecured loan at 'A-(emr)'. A full list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

IDRS, SENIOR DEBT AND SUPPORT RATING FLOOR

The bank's IDRs and SRF reflect the likelihood of support from Agrobanco's shareholder, the Republic of Peru ('BBB+'/'A-'/Outlook Stable), should it be required. Agrobanco is an autonomous government agency and, in Fitch's opinion, forms an integral part of the government's operations. Despite a very small overall market share, Agrobanco is the country's largest source of financing for the agricultural sector. In addition, its 100% government ownership, as well as the representation of the Ministries of Agriculture and Economy & Finance on its Board of Directors, evidences its importance to the government's economic development and agricultural policies.

The Stable Outlook is in line with Fitch's Stable Outlook for Peru's sovereign rating.

The rating of 'A-(emr)' on the long-term senior unsecured loan issued to Agrobanco by CITIBANK, N.A. in the local currency equivalent of USD45 million, similarly reflects the likelihood of government support, if needed. The subscript 'emr' refers to embedded market risk given that the loan is denominated in local currency while settlement is in USD.

RATING SENSITIVITIES

IDRS, SENIOR DEBT, SUPPORT RATING AND SUPPORT RATING FLOOR

As a fully state-owned financial institution, deeply integrated within the government, Agrobanco's creditworthiness and ratings are directly linked to those of the Republic of Peru. Hence, its ratings should move in line with any potential change in Peru's sovereign ratings.

Fitch has affirmed Agrobanco's ratings as follow:

--Foreign Currency long-term IDR at 'BBB+'; Outlook Stable;

--Foreign Currency short-term IDR at 'F2';

--Local Currency long-term IDR at 'A-'; Outlook Stable;

--Local Currency short-term IDR at 'F2';

--Support Rating at '2';

--Support Rating Floor at 'BBB+';

--Local Currency Long-term rating to a long-term unsecured loan at 'A-(emr)'.

Additional information is available on www.fitchratings.com

Applicable Criteria

Global Bank Rating Criteria (pub. 20 Mar 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=863501

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=991735

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=991735

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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