Spain

Fitch affirmed Cédulas TDA 14 at AAA, on stable outlook, yesterday (Thursday), in spite of a downgrade last week of Caja Madrid and its cédulas hipotecarias, to which Cédulas TDA 14 is heavily exposed.

Fitch downgraded IM Cédulas 1 Grupo Banco Popular’s mortgage backed covered bonds from AAA to AA, on stable outlook, yesterday (Thursday) because of a downgrade of Banco Popular Español’s rating from AA- to A.

The transfer of CajaSur’s assets and liabilities to Bilbao Bizcaya Kutxa will have a positive effect on the multi-cédulas exposed to CajaSur, and a neutral impact on those exposed to BBK, Fitch said today (Wednesday). The multi-cédulas are among 48 on Rating Watch Negative, which Fitch aims to resolve in the next two months.

The transparency of the methodology of the European stress tests and the disclosure of banks’ sovereign debt exposures they brought have been hailed as positive for the financial institutions bond markets, with Spain’s Banco Bilbao Vizcaya Argentaria taking advantage of positive sentiment to launch a senior unsecured bond today (Wednesday) close to cédulas levels.

Fitch cut mortgage covered bonds issued by Caja Madrid from AAA to AA+ on Friday and noted that the rating of Cédulas TDA 14, which is under review, is heavily exposed to Caja Madrid’s cédulas hipotecarias.

Spain’s Bankinter will today (Monday) add Eu400m to a Eu1bn cédulas hipotecarias issue first launched in March and will price the increase at a record high spread.

Fitch yesterday (Thursday) placed Bilbao Bizkaia Kutxa’s rating of A+ on Rating Watch Negative because of the announced acquisition the assets and liabilities of CajaSur, which was taken over by the Fund For Orderly Bank Restructuring at the behest of the Bank of Spain in May.

Fitch yesterday (Thursday) downgraded Caja Madrid’s rating from A+ to A, on negative outlook, because of revenue pressure and a decline in asset quality.

Moody’s put all ratings of Bilbao Bizkaia Kutxa on review for downgrade today (Wednesday) because of its proposed acquisition of Cajasur, which was taken over by Spain’s Fund for Orderly Bank Restructuring (FROB) in May.

Banco Bilbao Vizcaya Argentaria yesterday (Monday) received Eu3.1bn of orders for a covered bond that was marketed at a level designed to ensure “certainty of execution”, according to bankers at the leads.

Banco Bilbao Vizcaya Argentaria this (Monday) morning launched the first sizeable new cédulas issue in three months on the back of improved market sentiment for Spanish debt.

Fitch yesterday (Wednesday) cut mortgage-backed covered bonds issued by Banco Popular Español from AAA to AA+ following a downgrade of the issuer.