Fitch to rate Itau Unibanco notes BBB

Fitch Ratings said it expects to assign Itau Unibanco Holdings SA's upcoming 2021 subordinated notes a rating of BBB. The notes will be issued by Itau Unibanco's Grand Cayman branch for an amount of $500 million.

The outlook is stable.

The net proceeds will be used by Itau Unibanco for general corporate purposes.

The notes will rank at least equally with similar subordinated debts, the agency said. The expected rating of this tier II subordinated debt cannot be better than two notches below Fitch's rating of the long-term local-currency issuer default rating of A-.

The ratings reflect Itau Unibanco's broad and diversified franchise, placing it among the leaders in various segments of the Brazilian financial system; its high capacity of management, which has demonstrated agility in promptly reacting to economic fluctuations; its track record for solid performance and good asset pricing; and its robust risk controls, the agency added.

The ratings also consider its ample liquidity and greater diversification compared with local peers due to its overseas presence, Fitch said.

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