DUBLIN, March 16, 2022–(BUSINESS WIRE)–KBRA Europe (KBRA) is assigning senior deposit and unsecured debt ratings of A and deposit and short-term debt ratings of K1 to Banco Santander-Chile (“San Chile ” or “the bank”), a subsidiary of Banco Santander SA (“Santander”). The outlook for long-term ratings is stable.

The ratings are based on San Chile’s diversified business model, with strong retail and commercial franchises in Chile, combined with resilient financial performance throughout the cycle supported by the bank’s disciplined risk management, in accordance with the prudent practices of the Santander Group. The bank has demonstrated strong profitability and low earnings volatility over time, supported by its pricing power, revenue diversification and best-in-class profitability. San Chile’s focus on continuously expanding its digital banking capabilities in recent years has boosted its historically low commission revenue and new customer acquisition. San Chile’s asset quality is solid and in line with its domestic peers, despite a higher exposure to consumer loans, supported by its conservative underwriting standards. Asset quality measures have steadily improved since 2012, reflecting the shift to lower risk segments in the retail portfolio. The bank’s capitalization reflects its risk profile and benefits from strong internal capital generation. Conservative risk weightings under Chilean regulations affect many international comparisons. San Chile has a large stable deposit base and a healthy liquidity position. The bank’s reliance on market funds is relatively high, which may expose it to some refinancing risk, but bonds are primarily used to fund long-term mortgages with strong daily liquidity and funding management. The ratings also incorporate San Chile’s status as a strategically important subsidiary to its parent company, Santander, and a strong likelihood of government support, if needed, given San Chile’s systemic importance. The likelihood of external support provides additional stability to San Chile’s ratings in the event that the standalone credit profile weakens

The ratings are based on KBRA’s Global Bank & Bank Holding Company Rating Methodology published on November 8, 2021 and KBRA’s Global ESG Rating Methodology published on June 16, 2021.

Click here to see the report. To access relevant notes and documents, click here.

Disclosures
Further information on key credit considerations, sensitivity analyzes which look at factors that may affect these credit ratings and how they could lead to an upgrade or downgrade, and ESG factors (where they are a driver key to the change in credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially significant sources that were used to prepare the credit rating and information on the methodology(ies) (including all significant models and sensitivity analyzes of the main relevant rating assumptions, the where applicable) used to determine credit rating are available in the information disclosure form(s) located here.

Information on the meaning of each rating category can be found here.

This credit rating is approved by Kroll Bond Rating Agency UK Limited for use in the UK. Information about a credit rating’s approval status is available on its rating page on KBRA.com.

Additional information relating to this rating metric is available in the information disclosure form(s) referenced above. Additional information regarding KBRA’s policies, methodologies, grading scales and disclosures is available at www.kbra.com.

There are certain issuers, entities or transactions rated by KBRA Europe or KBRA UK which may be or have relationships with shareholders and/or shareholder related companies, as such term is defined in the shareholders and related companies policy. KBRA shareholders for KBRA Europe and KBRA UK. and Procedure. Relevant disclosure information can be found here.

About KBRA Europe
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the United States Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a rating agency with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a rating agency with the UK Financial Conduct Authority under the temporary registration scheme. In addition, KBRA is designated as the Designated Rating Agency by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a credit rating provider. Kroll Bond Rating Agency Europe is located at 6-8 College Green, Dublin 2, Ireland.

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contacts

Analytical Contacts

Joanna Drobnik, CFA, Principal (Senior Analyst)
+353 (1) 588 1250
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Joe Scott, Senior Managing Director (Ratings Committee Chair)
+1 (646) 731-2438
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Mauricio Noé, co-head of Europe
+44 208 148 1010
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