SANTO DOMINGO– Banco Popular Dominicano received an upgrade to “AAA” in its solvency rating and that of its long-term bonds, according to the latest report issued by the risk rating company Feller Rate, becoming the first Dominican-owned bank to achieve this important financial milestone.
This score is the highest rating a banking entity can receive in the world and obtaining it constitutes a milestone for Banco Popular and the Dominican Republic.
It is the only Dominican bank that Feller Rate has rated AAA, highlighting its leading position in the market, its revenue generation capacity and its prudent risk management.
Praise for the strategy and operational efficiency
According to the Feller Rate report, Banco Popular is recognized for its strong revenue generation capacity, even during periods of significant challenges stemming from the pandemic and external macroeconomic factors. The report also highlights the bank's robust risk management practices, adequate capital backing, and broad diversification of funding sources.
Feller Rate highlights the bank's strategy, which has enabled it to maintain adequate profitability levels and competitive advantages based on its digital transformation. Furthermore, the report indicates that "the bank's results are robust and have shown an upward trend over the last three years, widening the gap with peer banks and the average for multiple-service banks.".
The report highlights how Popular has incorporated new service models, product innovation and operational efficiency, with a focus on migrating to remote service for SMEs, boosting digital sales and using advanced analytics.
He also highlighted the use of an internal countercyclical provisioning policy to determine provisioning expenses, based on internal risk models, to address the potential risk of assets and contingencies associated with variations in the economic cycle.
Feller Rate pointed out that Popular “has broad access to sources of financing, highlighting a significant presence of demand and savings deposits,” thus observing adequate atomization and stability.
