SAO PAULO, Aug 5 (Reuters) - Brazil’s Itau Unibanco Holding SA’s international investment banking unit was rated investment grade by Moody’s Investors Service on Friday, in the agency’s first credit rating of the London-based bank.
Itau BBA International Plc received a A3 rating, six notches above that of parent Itaú Unibanco, Moody’s said in a statement, citing the unit’s low asset risk and large capital of $1 billion. The bank has around $9 billion in assets.
As Brazil grapples with the sharpest recession in more than eight decades and struggles to rebalance the government’s budget, the country lost its sovereign investment grade ratings. Moody’s downgraded Brazil’s bond ratings to junk in February.
The unit’s credit rating may ease its access to a new pool of clients, such as sovereign wealth funds, endowments and pension funds, Itaú BBA International Chief Executive Renato Lulia said in an interview on Friday.
“We may have new, cheaper funding alternatives with an investment grade rating. This is happening when investors and companies are regaining confidence in Brazil’s economy,” Lulia said.
Itau BBA International manages $14 billion in private banking clients’ assets and has subsidiaries in Miami and Zurich. (Reporting by Tatiana Bautzer; Editing by Richard Chang)