The rating agency also affirmed Industrial's B1 (hyb) foreign currency junior subordinated debt rating and the Ba2 foreign currency subordinated debt rating assigned to Industrial Subordinated Trust.

Banco Industrial S.A.:

The following rating was upgraded:

Bank financial strength rating to D+, stable outlook, from D

The following ratings were affirmed:

Long term local currency deposit rating of Baa3, stable

Short term local currency deposit rating of Prime-3

Long term foreign currency deposit rating of Ba2, stable

Short term foreign currency deposit rating of Not Prime

Foreign currency junior subordinated debt rating of B1 (hyb), stable

Industrial Subordinated Trust:

The following rating was affirmed:

Foreign currency subordinated debt rating of Ba2, stable

RATINGS RATIONALE

Moody's said that the upgrade of Industrial's standalone ratings incorporates the bank's growing core profitability, diversifying revenue and product mix, and improving risk management. Industrial's higher standalone ratings also reflect the bank's well executed expansion strategy and favorable growth prospects within its home country and target markets of Central America, a natural footprint for the bank as it leverages its customer relationships. The bank's strong base of relatively low cost local deposit funding and focus on accessing alternative long term funding sources also provide a platform for business development and position the bank favorably relative to other similarly rated banks in Latin America, said Moody's.

Nevertheless, Industrial's lower core capital ratios relative to those of regional peers coupled with an aggressive dividend policy, remain a constraint on the bank's standalone ratings particularly in light of its ongoing expansion strategy. Moreover, the bank's high single borrower concentrations continue to be a key risk factor that although endemic to its largely corporate lending focus expose Industrial to potential earnings and asset quality volatility. Plans to shift its asset mix towards more consumer and small business lending may also lead to asset quality pressures given their higher risk profiles, although these activities should also serve to boost both margin and fee generation. Moody's noted that increased credit risk is also partly mitigated by Industrial's strong earnings generation, proactive risk management practices, and by a track record of financial support from shareholders.

Competition is also a key risk factor as larger regional and international banks pose a tangible threat to Industrial's dominance in Guatemala and to its regional strategy. Industrial's entrenched positioning with the Guatemalan corporate and retail segment and deep knowledge of and commitment to the market as an indigenous bank represent strong mitigants to this encroachment. Over the longer term, however, the bank's still limited access to diverse long term funding, including reliable foreign currency sources to support its expanding operations in dollarized markets, could restrict its ability to compete effectively particularly in a scenario of heightened competition.

Industrial's Baa3 long term local currency deposit rating incorporates one notch of uplift from its BCA, reflecting Moody's assessment of a very high probability of systemic support for the bank's local currency obligations given its dominant deposit market shares and key role as a local paying bank, custodian, and tax collector. The Ba2 foreign currency deposit rating remains constrained by the Guatemalan country ceiling for deposits.

The B1 (hyb) foreign currency debt rating for Industrial's capital notes due 2068 now reflect a three notch differential with the bank's ba1 BCA versus two notches previously, to bring it in line with the ratings of similarly structured issuances in the region, said Moody's. The notching captures the notes' non-cumulative coupon skip mechanism, optional deferral features, and deep subordination in liquidation.

The Ba2 foreign currency subordinated debt rating of Industrial Subordinated Trust, Industrial's Cayman Islands-based debt issuance vehicle, reflects a two notch differential with the bank's local currency deposit rating, given the limited recourse of the note obligations relative to direct subordinated issuances of the bank.

The last rating action on Banco Industrial was on July 19, 2011, when Moody's assigned a Ba2 foreign currency subordinated debt rating to the issuance of ten year notes by Industrial Subordinated Trust.

The principal methodology used in rating Banco Industrial S.A. was Moody's Consolidated Global Bank Rating Methodology published in June 2012. Please see the Credit Policy page on www.moodys.com for a copy of these methodologies.

Based in Guatemala City, Industrial is the largest bank in the country, with 25% and 26% market shares in loans and deposits. As of March 31, 2012, it reported total consolidated assets of US$ 7.4 billion, shareholders' equity of US$ 488 million, and quarterly net income of US$ 30.9 million.

REGULATORY DISCLOSURES

The Global Scale Credit Ratings on this press release that are issued by one of Moody's affiliates outside the EU are endorsed by Moody's Investors Service Ltd., One Canada Square, Canary Wharf, London E 14 5FA, UK, in accordance with Art.4 paragraph 3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies. Further information on the EU endorsement status and on the Moody's office that has issued a particular Credit Rating is available on www.moodys.com.

For ratings issued on a program, series or category/class of debt, this announcement provides relevant regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides relevant regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides relevant regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

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Please see Moody's Rating Symbols and Definitions on the Rating Process page on www.moodys.com for further information on the meaning of each rating category and the definition of default and recovery.

Please see ratings tab on the issuer/entity page on www.moodys.com for the last rating action and the rating history. The date on which some ratings were first released goes back to a time before Moody's ratings were fully digitized and accurate data may not be available. Consequently, Moody's provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.

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Jeanne Del Casino VP - Senior Credit Officer Financial Institutions Group Moody'sInvestors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653Maria Celina Vansetti-Hutchins MD - Banking Financial Institutions Group JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653 Releasing Office: Moody's Investors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653(C) 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

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