Fitch corrects Santander

In a corrected rating, Fitch Ratings said it downgraded Santander Bancorp's long-term issuer default rating to BBB from A-, short-term issuer default rating to F2 from F1, support rating to 2 from 1 and subordinated debt to BBB- from BBB+ and affirmed its viability rating at bb+. Santander PR Capital Trust I's preferred stock was downgraded to BB from BB+. The outlook is negative.

The downgrade was a result of Fitch's downgrade of the long-term issuer default rating of Santander Bancorp's parent company, Banco Santander SA, on June 11.

The agency said the affirmed bb+ viability rating is supported by Santander Bancorp's sound operating performance and solid capital position while operating in the challenging Puerto Rican market. Although Fitch is concerned with Santander Bancorp's elevated levels of non-performing assets at 7.24%, the agency said it compares well to local peers with an average level of 13.95% as of the first quarter.

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