The Credicorp Ltd. (Credicorp) NYSE common stock has appreciated significantly since our last update report, in line with an increase in equity market indices and the strengthening of Peru’s nuevo sol against the US dollar. Going forward, we remain concerned about the slowing economy in Peru and Creditcorp’s asset quality. Therefore, we downgrade the common stock from a HOLD to a SELL. We will reassess our rating for Credicorp in our next full update report....

In 2008, the average real GDP grew 9.8% in Peru. However, Peru’s trailing twelve month GDP growth fell to 5.08% in November 2008 and to 4.9% in December 2008. Going forward, the Banco Central de Reserva del Perú (BCRP) expects GDP growth of only 5.0% in 2009 mainly due to falling metal export prices, which make up 60% of all its exports. Morgan Stanley (in a report analyzing the Peruvian economy dated 03 March 2009) expects Peru’s GDP to grow 3% in FY 2009 and 4% in FY 2010....

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Despite a robust top-line result, Credicorp Ltd. (Credicorp) reported weak earnings for 4Q 08, following a rise in provisions and impairment expenses. As we remain concerned about the likely downturn in the Peruvian economy, we expect to lower our estimates and target price when we revalue the…