Fitch Ratings has assigned an expected Long-Term rating of 'BB(EXP)' to Banco Bradesco S.A.'s (Bradesco) proposed senior unsecured notes acting through its Grand Cayman branch.

The size and the maturity of the issuance is yet to be determined upon book building. The bonds' proceeds shall be used for the financing and/or refinancing of existing or future social and sustainable projects. The final rating is contingent upon the receipt of final documents conforming to the information already received.

Key Rating Drivers

The expected rating on the notes corresponds to Bradesco's Long-Term (LT) Foreign Currency Issuer Default Rating (IDR; BB/Negative), as the likelihood of these senior obligations' default is the same as for the issuer and ranks equal to its other senior unsecured debt.

Banco Bradesco S.A.'s IDRs are driven by its Viability Rating (VR). The LT IDR is one notch above Brazil's (BB-/Negative) rating. The Negative Outlook on the IDRs mirrors the Outlook on Brazil's rating. Bradesco's VR is highly influenced by its strong franchise and diversified business model. The VR reflects the bank's consistent performance throughout economic cycles and in times of crisis, conservative risk management, diversified funding and revenue bases, strong liquidity, adequate asset quality, and stable capitalization.

Fitch expects earnings to remain challenged by subdued credit demand and above historic average loan impairment charges. For more details on Bradesco's ratings and credit profile, including its Key Sating Drivers and Rating Sensitivities, see Fitch's press release 'Fitch Revises Brazilian FIs' LT IDR Outlooks to Negative Following Operating Environment Revision,' dated May 8, 2020, available at www.fitchratings.com.

Rating Sensitivities

Factors that could, individually or collectively, lead to negative rating action/downgrade:

Debt rating downgrades will depend on downgrades of Bradesco's IDRs, given that its serves as an anchor rating for issuances.

Factors that could, individually or collectively, lead to positive rating action/upgrade:

Upgrades on debt ratings depend on upgrades of Bradesco's IDRs, given it serves as an anchor rating for issuances.

ESG CONSIDERATIONS

Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/esg.

Best/Worst Case Rating Scenario

International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specific best- and worst-case scenario credit ratings, visit https://www.fitchratings.com/site/re/10111579

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