Fitch downgrades Santander USA

Fitch Ratings said it downgraded Santander Holdings USA, Inc.'s long-term issuer default rating and senior debt to BBB from A-, short-term issuer default rating and commercial paper to F2 from F1 and support rating to 2 from 1 and affirmed its viability rating at bbb. The outlook is negative.

The preferred stock of Sovereign Capital Trust I, Sovereign Capital Trust IV and Sovereign Capital Trust VI was downgraded to BB- from BB+. Sovereign Real Estate Investment Trust Holdings' preferreds were downgraded to B+ from BB+, and ML Capital Trust I's preferreds were downgraded to BB- from BB+.

The agency also downgraded Sovereign Bank, NA'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, long-term deposit rating to BBB+ from A, short-term deposit rating to F2 from F1 and subordinated debt to BBB- from BBB+ and affirmed its viability rating at bbb.

The downgrades are a result of the downgrade of the long-term issuer default rating of the parent company, Banco Santander SA, and the change of its outlook to negative.

Fitch said Santander Holdings USA's viability rating reflects its sound overall financial condition including profitable operations, manageable level of problem loans and comfortable capital position.

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