Fitch Downgrades Intercam, CIBanco, and Vector Casa de Bolsa

Fitch Ratings has downgraded the credit ratings of Intercam Banco, CIBanco, and Vector Casa de Bolsa, following recent accusations by the US Department of the Treasury alleging the institutions were involved in money laundering activities tied to fentanyl trafficking. These allegations were followed by a temporary intervention by Mexico’s National Banking and Securities Commission (CNBV) into the operations of all three entities.

Fitch lowered Intercam Banco’s long- and short-term national counterparty ratings from “AA” and “F1” to “B” and “B,” respectively. CIBanco’s ratings were downgraded from “A” and “F1” to “B” and “B,” and Vector Casa de Bolsa saw its ratings fall from “AA” and “F1” to “B” and “B.” All ratings are now under Negative Watch. The downgrades also extend to the long and short-term national ratings of each institution’s affiliates, which were similarly placed under Negative Watch.

Fitch says that the rating actions reflect the imminent negative impact on the entities' financial and business profiles, stemming from the US Treasury’s concerns over deficiencies in anti-money laundering practices. The agency also cited the ban on certain financial transfers involving these institutions as a contributing factor.

Additionally, Fitch notes the implications of the temporary managerial intervention by the CNBV, which included replacing the institutions’ management teams and legal representatives, further intensifying regulatory pressure and operational uncertainty.

The agency says it will resolve the Negative Watch once there is greater clarity on the regulatory measures and their implications for the banks' credit profiles and ability to meet obligations. Depending on the outcome, further downgrades could follow if the events materially impact business models, income streams, or reputations.

Conversely, Fitch may affirm the current ratings and assign a Stable Outlook if the operational fallout proves less severe than anticipated. However, it cautioned that the upside potential remains limited in the near term due to the ongoing Negative Watch. In response to the situation, some FIBRA investment trusts announced plans to replace CIBanco as their trustee, signaling diminishing market confidence in the institution.