S&P upgrades Popular

S&P said it raised the ratings on Popular Inc. to BB-/B from B+/C.

The agency also said it raised the long-term rating on Banco Popular de Puerto Rico, its primary banking subsidiary, to BB+ from BB and affirmed the short-term rating at B.

The outlook is stable.

S&P also said it raised the ratings on two intermediate holding companies, Popular North America Inc. to BB-/B from B+/C and on Popular International Bank Inc. to BB- from B+ and removed the under criteria observation (UCO) designation on the short-term issuer credit rating on Popular and Popular North America.

The upgrade reflects a view that Popular is the best positioned bank in Puerto Rico to weather the local economic downturn and fiscal austerity for several reasons, S&P said.

The agency said it believes that the company's funding profile has improved substantially in recent years due to deposit growth and reduced wholesale borrowings, the agency said.

Additionally, Popular has the largest market share, cemented by the Doral Bank acquisition; lowest nonperforming asset ratios among its local peers; and has increased its capital ratios, S&P said.

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