Fitch Rates Nacional Financiera's Outstanding Certificates of Deposits Program 'BBB+/F2'

MONTERREY, Mexico--(BUSINESS WIRE)-- Fitch Ratings assigns 'BBB+/F2' foreign currency long- and short-term ratings to Nacional Financiera S.N.C.'s (Nafin) senior unsecured certificates of deposits (CDs) program and outstanding issuances made through its London branch. CDs with an aggregate value of USD2 billion (or its equivalent in other currencies) may have a tenor of between seven days and five years at fixed or discount rate.

Because CDs are senior unsecured debt and rank at least equally with all of the bank's other present and future unsecured and unsubordinated external debt the ratings assigned to this debt level are the same as Nafin's long and short-term Issuer Default Ratings (IDRs).

KEY RATING DRIVERS

Nafin's IDRs and Rating Outlook are aligned with Mexico's sovereign ratings and reflect the high ability and willingness of the country's federal government to support the enterprise at all times if needed. The ability to support is reflected in Mexico's investment-grade rating of 'BBB+' while the willingness of support relies on Nafin's explicit guarantee stated in its Organic Law (Article 10).

Under this law, the Mexican government is explicitly responsible for the operations held by Nafin with domestic or foreign institutions, as well as for its deposits. The willingness of support also considers the high importance of Nafin as the second-largest development bank in Mexico in terms of total assets and loan portfolio and that the Mexican federal government is its major shareholder (99.99%).

Nafin's key role is to encourage the development of private-sector micro, small and medium enterprises (MSMEs) by providing financing options and general services. Its credit activities are mainly '2nd floor' loans (financial intermediaries) and to a less extent, but gradually growing, '1st floor' loans; however, the entity has become an important player in providing loans guarantees, complemented by a menu of products including factoring, derivatives and fiduciary services.

RATING SENSITIVITIES

Changes in the ratings of this debt level would come from any potential change in Nafin's ratings, which generally would move in the same magnitude and direction.

In turn, Nafin's ratings would reflect any change in Mexico's sovereign ratings, given that the bank's IDRs are driven by the explicit support granted by the Mexican federal government as in Nafin's organic law.

Fitch currently rates Nafin as follows:

--Long-term foreign currency IDR 'BBB+'; Outlook Stable;

--Short-term foreign currency IDR 'F2';

--Long-term local currency IDR 'A-'; Outlook Stable;

--Short -term local currency IDR 'F2';

--Support Rating '2';

--Support Rating Floor 'BBB+'.

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=994049

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=994049

Endorsement Policy

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

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20151113005939/en/

Fitch Ratings
Primary Analyst
Diego Garcia, +52 818 399 9100 ext. 1502
Analyst
Fitch Mexico S.A. de C.V.
Prol. Alfonso Reyes 2612
64920 Monterrey, Mexico
or
Secondary Analyst
Monica Ibarra, +52 818 399 9150
Director
or
Committee Chairperson
Franklin Santarelli, +1-212-908-0739
Managing Director
or
Media Relations, New York
Alyssa Castelli, +1-212-908-0540
[email protected]

Source: Fitch Ratings

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