Key Rating Drivers
IDRs and Senior Debt
IDRs Driven by Main Subsidiary's IDRs: Credicorp's IDRs are driven primarily by the IDR of its main subsidiary, BCP, which has a strong business and financial profile. Credicorp's Foreign Currency Long-Term IDR of 'BBB' with a Negative Outlook is equalized with BCP's rating.
Low Double Leverage: The equalization is mainly driven by Credicorp's low double leverage and its strong liquidity management. Double leverage reached 102.1% at YE 2022. There is a long track record of significant dividend flows that provide the bulk of Credicorp's liquidity.
Strong Corporate Strategy: Credicorp is a non-operating holding company that maintains an integrated business platform composed of leading Peruvian and Bolivian banking, insurance, pension, and asset and wealth management companies, as well as entities in the microfinance sector in Peru and Colombia.
Consistent Performance: Credicorp's capital structure benefits from its subsidiaries' profitability, which allows it to maintain consistent dividend flows. Asset quality ratios on a consolidated basis were: 90-days impaired loans to total loan ratio at YE 2022 was 3.1% (YE 2021: 2.9%) and reserve coverage was 170.4% (YE 2021: 201.7%).
Improving Profitability: Following the profitability improvement in its main subsidiary, Credicorp's consolidated profitability is improving and close to pre-pandemic levels (ROAE and ROAA at YE22: 17.1% and 2.0%, respectively).
Senior Debt Ratings: The senior global debt rating is at the same level as Credicorp's Long-Term IDRs of 'BBB', as the likelihood of default of the notes is the same as that of Credicorp.
Rating Sensitivities
Factors that could, individually or collectively, lead to negative rating action/downgrade:
•
Credicorp's IDRs would remain at the same level as BCP's and would move in tandem with any rating actions on its main operating subsidiary. However, the relativity between these two entities' ratings could also be affected and the holding company downgraded in the event of a material and sustained increase in Credicorp's double- leverage metrics (above 1.2x) and if Fitch perceives a material weakening of the holding company's liquidity position and its management.
•
A change in the dividend flows from the operating companies or debt levels at the holding company that affects its debt coverage ratios could also be detrimental to Credicorp's ratings.
•
The ratings for Credicorp's senior unsecured debt would move in line with its Long-Term IDR.
Factors that could, individually or collectively, lead to positive rating action/upgrade:
•
Credicorp Ltd's ratings would move in tandem with positive rating actions on its main operating subsidiary, BCP.
•
The ratings for Credicorp's senior unsecured debt would move in line with Credicorp's Long-Term IDR.

Ratings
Foreign Currency
Long-Term IDR
BBB
Short-Term IDR
F2
Sovereign Risk (Peru)

Long-Term Foreign-Currency IDR
BBB
Long-Term Local-Currency IDR
BBB
Country Ceiling
BBB+
Outlooks
Long-Term Foreign-Currency IDR
Negative
Sovereign Long-Term Foreign-Currency IDR
Negative
Sovereign Long-Term Local-Currency IDR
Negative
Applicable Criteria
Bank Rating Criteria (September 2022)

Financial Data
Credicorp Ltd.

12/31/22
12/31/21
Total Assets (USD Mil.)
62,156.4
61,443.6
Total Assets (PEN Mil.)
236,753.6
244,846.7
Total Equity (PEN Mil.)
29,579.7
27,037.4

Analysts
Robert Stoll
+1 212 908 9155
robert.stoll@fitchratings.com
Andres Marquez
+57 601 241 3254
andres.marquez@fitchratings.com

Update │ April 21, 2023
fitchratings.com 1


Issuer Ratings (Including Main Issuing Entities)
Rating Level
Rating
Long-Term Foreign-Currency IDR
BBB
Short-Term Foreign-Currency IDR
F2
Outlook/Watch
Negative
Source: Fitch Ratings


Debt Rating Classes

Rating Level
Rating
Senior unsecured: Long-Term
BBB
Source: Fitch Ratings


Significant Changes
On October 2022, Fitch revised the Rating Outlook on the sovereign's Long-Term (LT) Issuer Default Ratings (IDR) to Negative as a deterioration in political stability and government effectiveness has increased downside risks to Peru's ratings. In the agency's view, weaker governance poses greater downside risks to investment and economic growth.
Fitch believes Credicorp's and its main subsidiary's credit profiles are sensitive to a material deterioration in the local operating environment or a negative sovereign rating action. In consequence, the Outlook on the OE score remains negative as a slowdown in economic and loan growth, an increase in borrowing costs and persistent political uncertainty are detracting from Peruvian banking sector activity. However, sustained capitalization, improving profitability and lower loan impairment charges provide sufficient resilience to face stress from political uncertainty and external shocks.


Credicorp Ltd.
Update │ April 21, 2023
fitchratings.com2

Summary Financials

2022

2021
2020
2019
(Year End as of Dec. 31, Audited - Unqualified)
(USD Mil.)
(PEN Mil.)
(PEN Mil.)
(PEN Mil.)
(PEN Mil.)
Summary Income Statement

Net Interest and Dividend Income
3,024
11,518.1
9,362.0
8,571.3
9,090.8
Net Fees and Commissions
956
3,640.3
3,493.7
2,912.8
3,232.8
Other Operating Income
571
2,173.7
1,434.3
1,895.4
2,146.5
Total Operating Income
4,550
17,332.1
14,290.0
13,379.5
14,470.1
Operating Costs
2,263
8,620.6
7,740.1
7,127.0
6,666.4
Pre-Impairment Operating Profit
2,287
8,711.5
6,549.9
6,252.5
7,803.7
Loan and Other Impairment Charges
491
1,869.8
1,219.0
5,972.8
1,845.2
Operating Profit
1,796
6,841.7
5,330.9
279.7
5,958.5
Other Non-Operating Items (Net)
4
14.2
1.9
-55.5
16.9
Tax
554
2,110.5
1,661.0
-109.9
1,623.1
Net Income
1,246
4,745.4
3,671.8
334.1
4,352.3
Other Comprehensive Income
-234
-891.0
-1,660.0
787.0
387.7
Fitch Comprehensive Income
1,012
3,854.4
2,011.8
1,121.1
4,740.0
Summary Balance Sheet
Assets
Gross Loans
39,020
148,626.4
147,597.4
137,659.9
115,609.7
- of which impaired
1,213
4,620.5
4,208.9
3,833.8
2,479.9
Loan Loss Allowances
2,067
7,872.4
8,477.3
9,898.8
5,124.0
Net Loan
36,953
140,754.0
139,120.1
127,761.1
110,485.7
Interbank
1,035
3,942.9
8,047.6
4,410.9
2,036.1
Derivatives
388
1,478.7
1,661.6
1,214.5
1,092.1
Other Securities and Earning Assets
13,284
50,597.3
53,860.8
59,593.3
37,760.5
Total Earning Assets
51,660
196,772.9
202,690.1
192,979.8
151,374.4
Cash and Due from Banks
7,939
30,241.0
31,273.1
32,342.1
23,950.7
Other Assets
2,557
9,739.7
10,883.5
12,084.3
12,534.2
Total Assets
62,156
236,753.6
244,846.7
237,406.2
187,859.3
Liabilities
Customer Deposits
38,226
145,602.0
148,268.9
141,162.5
110,825.0
Interbank and Other Short-Term Funding
4,072
15,511.1
23,342.4
29,128.0
9,064.5
Other Long-Term Funding
6,516
24,818.9
25,035.2
22,296.3
23,582.0
Trading Liabilities and Derivatives
403
1,536.7
1,862.7
1,766.8
1,534.0
Total Funding and Derivatives
49,217
187,468.7
198,509.2
194,353.6
145,005.5
Other Liabilities
5,173
19,705.2
19,300.1
17,607.0
16,107.5
Preference Shares and Hybrid Capital
N.A.
N.A.
N.A.
N.A.
N.A.
Total Equity
7,766
29,579.7
27,037.4
25,445.6
26,746.3
Total Liabilities and Equity
62,156
236,753.6
244,846.7
237,406.2
187,859.3
Exchange Rate
USD1 = PEN3.8090
USD1 = PEN3.9849
USD1 = PEN3.6200
USD1 = PEN3.3120
N.A. - Not applicable
Source: Fitch Ratings, Fitch Solutions

Credicorp Ltd.
Update │ April 21, 2023
fitchratings.com3

Key Ratios
(%, as of Dec. 31)
2022
2021
2020
2019
Ratios (annualized as appropriate)
Profitability
Operating Profit/Risk-Weighted Assets
N.A.
N.A.
N.A.
N.A.
Net Interest Income/Average Earning Assets
5.7
4.4
4.6
5.8
Non-Interest Expense/Gross Revenue
50.0
54.5
53.5
46.3
Net Income/Average Equity
17.1
14.3
1.4
17.1
Asset Quality
Impaired Loans Ratio
3.1
2.9
2.8
2.2
Growth in Gross Loans
0.7
7.2
19.1
4.4
Loan Loss Allowances/Impaired Loans
170.4
201.7
258.2
206.6
Loan Impairment Charges/Average Gross Loans
1.2
0.9
4.6
1.7
Capitalization
Common Equity Tier 1 Ratio
N.A.
N.A.
N.A.
N.A.
Fully Loaded Common Equity Tier 1 Ratio
N.A.
N.A.
N.A.
N.A.
Fitch Core Capital Ratio
N.A.
N.A.
N.A.
N.A.
Tangible Common Equity/Tangible Assets
11.4
10.0
9.7
13.1
Basel Leverage Ratio
N.A.
N.A.
N.A.
N.A.
Net Impaired Loans/Common Equity Tier 1
N.A.
N.A.
N.A.
N.A.
Net Impaired Loans/Fitch Core Capital
-12.2
-17.6
-26.6
-10.9
Funding and Liquidity
Gross Loans/Customer Deposits
102.1
99.6
97.5
104.3
Liquidity Coverage Ratio
N.A.
N.A.
N.A.
N.A.
Customer Deposits/Total Non-Equity Funding
78.2
75.3
73.1
77.0
Net Stable Funding Ratio
N.A.
N.A.
N.A.
N.A.
N.A. - Not applicable
Source: Fitch Ratings, Fitch Solutions

Credicorp Ltd.
Update │ April 21, 2023
fitchratings.com4
Environmental, Social and Governance 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.

Credicorp Ltd.
Update │ April 21, 2023
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The ratings above were solicited and assigned or maintained at the request of the rated entity/issuer or a related third party. Any exceptions follow below.

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Credicorp Ltd.
Update │ April 21, 2023
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Credicorp Ltd. published this content on 24 April 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 April 2023 20:14:27 UTC.