Spain

In brief: The Royal Decree finalising the update to Spain’s cédulas framework was published in the country’s official gazette on Saturday and came into force yesterday (Monday).

Fitch on Tuesday changed the outlook on the issuer rating of Caja de Ahorros y Pensiones de Barcelona (La Caixa) from stable to negative, but revised upward its expectation of government support for the Spanish savings bank.

Barclays Bank SA, the Spanish arm of the UK banking group, has issued cédulas hipotecarias for the first time.

Spain’s Council of Ministers on Friday approved a long-awaited royal decree that will bring into force secondary regulations that clarify and develop the country’s covered bond framework.

Caja Madrid was downgraded from AA- to A+ by Fitch yesterday (Wednesday) afternoon because of a decline in its asset quality and risk concentration.

Fitch yesterday (Tuesday) downgraded Banco Popular Español from AA to AA-, on concerns over its funding mix and its exposure to the worst-hit sectors of the Spanish economy.

The flow of Spanish government guaranteed bond issuance is showing no signs of stopping as two more borrowers are preparing issues, of which at least one will be priced next week.

The Spanish authorities’ rescue of Caja de Ahorros de Castilla-La Mancha (CCM) is not likely to affect Fitch’s AAA ratings of multi-issuer cédulas transactions to which the savings bank contributes, said the rating agency yesterday (Thursday).

Caixa Galicia has closed books on a Eu1.25bn three year government guaranteed issue that it is due to be priced this (Friday) afternoon, rounding off a week in which Spanish issuers fared better than some market participants had been expecting after Caja de Ahorros de Castilla-La Mancha had to be rescued last weekend.

Fitch yesterday (Tuesday) placed the issuer rating of Caja de Ahorros de Castilla La Mancha (CCM) on Rating Watch Positive.

Fixed income markets were this (Monday) morning taking the Spanish authorities’ rescue of Caja de Ahorros de Castilla-La Mancha (CCM) calmly, despite it being the first bailout of a bank in the country since the crisis began.

Banco Cooperativo Español on Wednesday priced a Eu1.4bn three year government-guaranteed deal, showing that despite the relentless pace of guaranteed issuance from Spain, the right name can still drum up plenty of investor interest.