S&P cuts Santander

Standard & Poor's said that it lowered its foreign- and local-currency counterparty credit ratings on Banco Santander (Mexico) to BBB/ A-3 from BBB+/A-2.

At the same time, S&P said it affirmed its mxAAA national-scale rating on the bank.

The outlook is stable.

"These rating actions follow the downgrade of the United Mexican States to BBB/stable/A-3 earlier," noted S&P credit analyst Laurence Wattraint.

Although the Mexican banking system has maintained adequate financial performance and has proactively managed increasing risks, S&P said it believes that under the current global financial circumstances and a more complicated economic environment in Mexico, Banco Santander (Mexico) does not have sufficient operational and financial flexibility to deal with the sovereign indirect risk.

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