S&P places Spanish banks on negative watch

Standard & Poor's said it placed some ratings on a number of Spain-based banks on CreditWatch with negative implications following the downgrade of the Kingdom of Spain on Jan. 13.

Specifically, the agency said it placed the following on CreditWatch with negative implications:

• The A- issue ratings on Banco Bilbao Vizcaya Argentaria SA's nondeferrable subordinated debt and BBB issue ratings on its Tier 1 hybrid notes;

• The BBB- issue ratings on CaixaBank SA's preferred stock;

• The A-2 short-term counterparty credit rating on Bankia SA;

• The A-2 short-term counterparty credit rating on Ibercaja Banco SA, BBB- issue ratings on its nondeferrable subordinated debt, and BB issue ratings on its preferred stock;

• The A-2 short-term counterparty credit rating on Bankinter SA, BBB- issue ratings on its nondeferrable subordinated debt, and BB issue rating on its preferred stock; and

• The BBB/A-2 long- and short-term counterparty credit ratings on Banca Civica SA.

All other ratings on Spanish banks that were placed on CreditWatch negative remain on CreditWatch.

The agency said its decision to update and extend its previous CreditWatch placements to the short-term ratings on several banks and issue ratings on their nondeferrable subordinated debt and/or hybrid instruments reflects the wider implications that could arise if S&P revised its assessment of the Spanish banking sector's economic and industry risks. This could lead S&P to lower the anchor for banks operating in Spain and consequently to lower the stand-alone credit profiles on rated banks.

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