New York, May 07, 2013 -- Moody's Investors Service has assigned a Aa3 long-term foreign
currency senior unsecured debt rating to Banco del Estado de Chile's (Banco
Estado) US$ 200 million issuance of senior notes due 2017 under
its US$ 2 billion MTN program. The notes constitute a further
issuance of, and will form a single series with, the bank's
2.000% Senior Notes Due 2017 issued on 9 November 2012 in
the amount of $500 million. Upon completion of the reopening,
the total aggregate principal amount of the series will be $ 700
million. The notes are governed by the laws of the State of New
York. The outlook on the rating is stable.
The following rating was assigned to Banco Estado's US$ 200
million senior notes:
Aa3 long-term foreign currency senior unsecured debt
RATINGS RATIONALE
The Aa3 foreign currency senior debt rating is based on Banco Estado's
Aa3 global foreign currency deposit rating and is unconstrained by Moody's
Aa1 Chilean country ceiling for bonds and notes. The Aa3 debt rating
incorporates the bank's standalone baseline credit assessment of a3,
which receives four notches of uplift reflecting Moody's assumption of
full support from the Chilean government in case of need, given
its 100% ownership by the government as well as Banco Estado's
important deposit and loan franchise in Chile.
The bank's standalone credit assessment reflects its fundamental
strengths, including broad client and geographic coverage that ensures
access to a stable, low cost core deposit base, its robust
liquidity, and stable asset quality. Its focus on low-to-middle
income individuals exposes the bank to below average asset quality particularly
in its large mortgage portfolio, which is balanced by a high quality
corporate loan book and limited exposure to unsecured consumer credit.
Nevertheless, the bank's leaner pre-tax profitability
and capitalization metrics relative to similarly rated peers in Chile
and the region are key risk factors for Banco Estado though they in part
reflect its social mission and implicit government support.
The last rating action on Banco del Estado de Chile was on November 5,
2012, when Moody's assigned a Aa3 foreign currency senior unsecured
debt rating to a US$ 500 million issuance under the bank's US$
2 billion MTN program.
The principal methodology used in this rating was Moody's Consolidated
Global Bank Rating Methodology published in June 2012. Please see
the Credit Policy page on www.moodys.com for a copy of this
methodology.
Banco del Estado de Chile is headquartered in Santiago, Chile,
and reported consolidated assets of approximately US$ 48.5
billion and shareholders' equity of US$ 2.2 billion
as of December 31, 2012. Banco Estado is the country's
third largest bank and its sole government-owned full service commercial
bank.
REGULATORY DISCLOSURES
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this rating action, and
whose ratings may change as a result of this rating action, the
associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
Please see Moody's Rating Symbols and Definitions on the Rating
Process page on www.moodys.com for further information on
the meaning of each rating category and the definition of default and
recovery.
Please see ratings tab on the issuer/entity page on www.moodys.com
for the last rating action and the rating history. The date on
which some ratings were first released goes back to a time before Moody's
ratings were fully digitized and accurate data may not be available.
Consequently, Moody's provides a date that it believes is
the most reliable and accurate based on the information that is available
to it. Please see the ratings disclosure page on our website www.moodys.com
for further information.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has
issued the rating.
Jeanne Del Casino
VP - Senior Credit Officer
Financial Institutions Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Maria Celina Vansetti-Hutchins
MD - Banking
Financial Institutions Group
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Moody's assigns Aa3 to Banco del Estado de Chile's US dollar senior notes