Fitch rates Banco Santander hybrids BB+

Fitch Ratings said it expects to assign a long-term rating of BB+ to Banco Santander Mexico's proposed hybrid securities in the form of 10-year Basel III-compliant tier 2 subordinated notes.

The expected rating is three notches below the applicable anchor rating, SAN Mexico's viability rating, which is currently BBB+.

Fitch said it expects that, under the proposed terms, these securities will receive 50% equity credit for the purposes of assessing capital adequacy, according to criteria and metrics.

The agency said it considers that these securities will likely remain rated three notches below SAN Mexico's. Therefore, the rating of these securities will typically move in line with any potential changes of SAN Mexico's viability rating, Fitch said.

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