Banco Internacional del Perú A Interbank : INFORMES DE CLASIFICACIÓN DE RIESGO.

Banks

Banco Internacional del Peru S.A.A. - Interbank

Update

Universal Commercial Banks

Peru

Ratings

Foreign Currency

Long-Term Issuer Default Rating	BBB
Short-Term Issuer Default Rating	F3
Local Currency

Long-Term Issuer Default Rating	BBB
Short-Term Issuer Default Rating	F3

Key Rating Drivers

Negative Rating Outlook: Banco Internacional del Peru S.A.A. - Interbank's (Interbank) Issuer Default Ratings (IDRs) and senior debt ratings are driven by its 'bbb' Viability Rating (VR), which is in line with the implied VR. The Negative Rating Outlook on the Long-Term IDRs is aligned with the Negative Rating Outlook on Peru's sovereign rating. The VR and Long-Term IDRs are sensitive to a material deterioration in the local operating environment (OE) or a negative sovereign rating action. OE pressures include a slow recovery of GDP due to the challenging investment and business environment.

Strong Franchise in Retail Lending: Interbank is Peru's fourth largest universal commercial bank, with a market share by loans and deposits of 13.3% and 13.8%, respectively, as of 2Q23. It has a strategic focus on retail banking in Peru, as reflected in its 22.7% and 19.4% market shares in consumer loans and retail deposits, respectively, at 2Q23, comparable with the largest Peruvian bank's market shares in these products.

Stable Asset Quality: As of 2Q23, the 90 days nonperforming loans (NPL) ratio remained stable at

2.6% (YE22: 2.6%) and similar to pre-pandemic levels despite the important expansion of the retail segment and the seasoning of Reactiva Peru program loans. Loan loss allowance coverage of impaired loans of 192.2% at 2Q23 (YE22: 191.7%) is adequate and similar to pre-pandemic levels. Fitch Ratings believes asset quality could deteriorate slightly in 2023, due to unseasoned retail loan growth and weaker borrower repayment capacity due to high interest rates and high inflation.

Sound Probability: The operating profit-to-risk-weighted assets (RWA) ratio increased slightly to 2.4% at 2Q23, from 2.3% at YE22, reflecting a higher net interest margin (NIM) and controlled credit and noninterest expenses. Higher interest rates coupled with a change in the portfolio mix, with a higher proportion of the retail segment and a lower proportion of the commercial portfolio, supported the NIM. Fitch expects profitability to remain sound at around 2%, supported by a strong NIM and good efficiency.

Adequate Capitalization: Interbank's Fitch Core Capital (FCC) declined to 10.4% at 2Q23, versus 10.7% at 2Q22, reflecting higher RWA due to the bank's increased exposure in retail loans and the seasoning of Reactiva Peru loans. Fitch expects Interbank's capitalization to remain commensurate with current ratings, sustained by moderate expected growth and sound earnings generation.

Stable Funding and Liquidity: The loan-to-deposits ratio remained stable at 108.2% as of 2Q23, similar to 109.6% at YE22. Deposit growth was 3.4% as of June 2023, reflecting tighter monetary policy, and covered more than two thirds of funding needs (75.9% at 2Q23). Fitch expects liquidity pressures to remain within rating expectations, partly reflecting stable monetary policy signals as of mid-2023.

Rating Sensitivities

Factors that could, individually or collectively, lead to negative rating action/downgrade

IDRs and VR

• The IDRs are sensitive to a negative rating action on the sovereign or any deterioration of Fitch's OE score assessment.
• Interbank's VR could be downgraded if asset quality deterioration causes a sustained Firmado Digitalmentedecline inpor:the bank's operating profit-to-RWA ratio to less than 2.0% and loss absorption
  GLORIA CECILIA RAMIREZ RIESCO Fecha: 25/08/2023 11:49:17 a.m.

Viability Rating	bbb
Government Support Rating	bbb-

Sovereign Risk

Long-Term Foreign Currency
Issuer Default Rating	BBB
Long-Term Local Currency
Issuer Default Rating	BBB
Country Ceiling	BBB+

Rating Outlooks

Long-Term Foreign Currency
Issuer Default Rating	Negative
Long-Term Local Currency
Issuer Default Rating	Negative
Sovereign Long-Term Foreign
Currency Issuer Default Rating	Negative
Sovereign Long-Term Local
Currency Issuer Default Rating	Negative

Applicable Criteria

Bank Rating Criteria (September 2022)

Related Research

Latin American Banks 2023 Outlook (December 2022)

Financial Data

Banco Internacional del Peru S.A.A. - Interbank

(PEN Mil.)	June 30, 2023	Dec. 31, 2022
Total Assets	18,662.6	17,444.4
(USD Mil.)
Total Assets	67,633.4	66,445.7
Total Equity	7,279.2	7,079.8

PEN - Peruvian sol. USD - U.S. dollars. Source: Fitch Ratings, Fitch Solutions, Interbank

Analysts

Ricardo Aguilar

[phone] [e-mail]

Larisa Arteaga

[phone] [e-mail]

Update │ August 25, 2023

fitchratings.com

1

Banks

Universal Commercial Banks

Peru

capacity, either in the form of an FCC or common equity Tier 1 (CET1) ratio below 10% or a relevant decline in reserve coverage for more than four consecutive quarters.

Factors that could, individually or collectively, lead to positive rating action/upgrade

IDRs and VR

• Interbank's IDRs currently have a Negative Rating Outlook in line with the sovereign, which makes an upgrade highly unlikely over the rating horizon as the bank's IDRs are constrained by the sovereign ratings.
• Over the medium term, Interbank's ratings could be upgraded by the confluence of improvement in theOE and thebank's financial profiles in thecontext ofa sovereign upgrade.

Other Debt and Issuer Ratings

Rating Type	Rating	Rating Outlook
Subordinated: Long-Term	BB+	-
Source: Fitch Ratings

Subordinated Debt

Interbank's subordinated bonds are considered "plain vanilla," as they do not have coupon deferral features. The subordinated debt is two notches below the VR of 'bbb', reflecting baseline notching for loss severity. There is no notching due to incremental nonperformance risk.

• The subordinated debt ratings would be downgraded if Interbank's VR is downgraded.
• Subordinated debt ratings would be upgraded if Interbank's VR is upgraded.

Banco Internacional del Peru S.A.A. - Interbank
Update │ August 25, 2023	fitchratings.com	2

Banks

Universal Commercial Banks

Peru

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Banco Internacional del Peru S.A.A. - Interbank ESG Relevance:

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D or RD

The Key Rating Driver (KRD) weightings used to determine the implied VR are shown as percentages at the top. In cases where the implied VR is adjusted upward or downward to arrive at the VR, the KRD associated with the adjustment reason is highlighted in red. The shaded areas indicate the benchmark-implied scores for each KRD.

VR - Adjustments to Key Rating Drivers

The OE score has been assigned above the implied score due to the following adjustment reasons: Sovereign Rating (positive) and Macroeconomic Stability (positive).

The Capitalization and Leverage score has been assigned above the implied score due to the following adjustment reason: Reserve Coverage and Asset Valuation (positive).

Banco Internacional del Peru S.A.A. - Interbank
Update │ August 25, 2023	fitchratings.com	3

Banks

Universal Commercial Banks

Peru

Summary Financials and Key Ratios

	2023a		2022	2021	2020
	USD Mil.	PEN Mil.	PEN Mil.	PEN Mil.	PEN Mil.
(Years Ended as of Dec. 31)	Interim	Interim	Audited	Audited	Audited
Summary Income Statement
Net Interest and Dividend Income	503	1,821.1	3,280.5	2,699.8	2,881.2
Net Fees and Commissions	76	276.3	651.2	555.0	502.5
Other Operating Income	72	259.3	412.2	511.4	407.5
Total Operating Income	650	2,356.7	4,343.9	3,766.2	3,791.2
Operating Costs	261	945.5	1,862.4	1,696.3	1,491.4
Pre-Impairment Operating Profit	389	1,411.2	2,481.5	2,069.9	2,299.8
Loan and Other Impairment Charges	189	686.0	1,002.6	450.2	2,003.0
Operating Profit	200	725.2	1,478.9	1,619.7	296.8
Other Non-Operating Items (Net)	11	39.4	11.7	-35.2	-0.5
Tax	52	188.7	318.9	384.0	31.4
Net Income	159	575.9	1,171.7	1,200.5	264.9
Other Comprehensive Income	58	209.3	-294.5	-581.1	191.8
Fitch Comprehensive Income	217	785.2	877.2	619.4	456.7
Summary Balance Sheet
Assets
Gross Loans	12,894	46,726.6	45,629.3	43,315.9	41,859.8
- of which Impaired	331	1,200.9	1,172.7	1,299.5	1,343.5
Loan Loss Allowances	637	2,307.5	2,247.8	2,067.0	2,856.5
Net Loans	12,257	44,419.1	43,381.5	41,248.9	39,003.3
Interbank	134	484.5	1,075.7	919.9	845.5
Derivatives	59	212.7	476.5	783.6	435.2
Other Securities and Earning Assets	3,188	11,551.9	9,721.9	10,586.5	9,582.5
Total Earning Assets	15,637	56,668.2	54,655.6	53,538.9	49,866.5
Cash and Due from Banks	2,554	9,257.2	10,229.6	12,952.7	16,257.8
Other Assets	471	1,708.0	1,560.5	1,620.4	1,699.8
Total Assets	18,663	67,633.4	66,445.7	68,112.0	67,824.1
Liabilities
Customer Deposits	11,878	43,047.3	41,638.6	42,873.1	43,290.6
Interbank and Other Short-Term Funding	2,874	10,416.7	9,416.0	10,085.2	9,227.7
Other Long-Term Funding	1,552	5,625.0	6,904.6	7,086.5	7,873.4
Trading Liabilities and Derivatives	64	233.4	297.0	413.1	0.0
Total Funding and Derivatives	16,369	59,322.4	58,256.2	60,457.9	60,391.7
Other Liabilities	285	1,031.8	1,109.7	851.3	1,249.0
Total Equity	2,009	7,279.2	7,079.8	6,802.8	6,183.4
Total Liabilities and Equity	18,663	67,633.4	66,445.7	68,112.0	67,824.1
Exchange Rate	-	USD1 = PEN3.6240	USD1 = PEN3.8090	USD1 = PEN3.9849	USD1 = PEN3.6200

aFirst six months of 2023 only (1H23), ended June 30. PEN - Peruvian sol. USD - U.S. dollars. Source: Fitch Ratings, Fitch Solutions, Interbank

Banco Internacional del Peru S.A.A. - Interbank
Update │ August 25, 2023	fitchratings.com	4

Banks

Universal Commercial Banks

Peru

Summary Financials and Key Ratios

(Years Ended as of Dec. 31)	2023a	2022	2021	2020
Ratios (Annualized as Appropriate)
Profitability
Operating Profit/Risk-Weighted Assets	2.4	2.3	2.8	0.6
Net Interest Income/Average Earning Assets	6.6	6.0	5.2	6.2
Noninterest Expense/Gross Revenue	40.4	43.4	45.5	39.5
Net Income/Average Equity	16.4	17.6	19.1	4.4
Asset Quality
Impaired Loans Ratio	2.6	2.6	3.0	3.2
Growth in Gross Loans	2.4	5.3	3.5	15.0
Loan Loss Allowances/Impaired Loans	192.2	191.7	159.1	212.6
Loan Impairment Charges/Average Gross Loans	3.0	2.3	1.0	5.1
Capitalization
Common Equity Tier 1 Ratio	N.A.	10.8	12.5	11.5
Fitch Core Capital Ratio	10.4	11.0	11.9	12.0
Tangible Common Equity/Tangible Assets	9.7	10.0	9.4	8.5
Net Impaired Loans/Fitch Core Capital	-17.1	-16.4	-12.1	-26.4
Funding and Liquidity
Gross Loans/Customer Deposits	108.6	109.6	101.0	96.7
Customer Deposits/Total Non-Equity Funding	72.9	71.8	71.4	71.7

aFirst six months of 2023 only (1H23), ended June 30. N.A. - Not applicable Source: Fitch Ratings, Fitch Solutions, Interbank

Banco Internacional del Peru S.A.A. - Interbank
Update │ August 25, 2023	fitchratings.com	5