S&P places Corpbanca, Corp Group Interhold ratings on CreditWatch negative

Friday, December 23, 2011

Standard & Poor's (S&P) placed Chilean bank Corpbanca's (NYSE: BCA) and CorpGroup Interhold's counterparty ratings on CreditWatch with negative implications, the ratings agency said in a release.

Corpbanca's counterparty credit rating is A-/A-2, while CorpGroup's is BB+.

The action comes after the Chilean firms recently agreed to acquire Spanish bank Santander's (NYSE: STD) Colombian subsidiary, Banco Santander Colombia, the release reads.

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According to S&P, the CreditWatch listings reflect the potential deterioration of Corpbanca's overall asset quality due to its acquisition of Colombian assets that are riskier when compared to Chilean assets.

The ratings agency intends to resolve the CreditWatch listings after the transactions close, expected in 1H12, as they are subject to regulatory approval in Chile and Colombia.

In early December, Corpbanca announced an agreement to acquire 95% of Santander Colombia for some US$1.15bn, while Interhold, Corpbanca's controlling parent, agreed to acquire at least 2.85% of the Colombian bank.

To read the full report, go to this link