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Moody's upgrades Spain's Abanca on improved financial profile

Moody's on Oct. 1 upgraded Abanca Corporación Bancaria SA's long-term bank deposit ratings to Ba1 from Ba2, with the outlook remaining positive.

The agency also upgraded the Spanish lender's long- and short-term counterparty risk ratings to Baa2/Prime-2 from Ba1/Not Prime, its long- and short-term counterparty risk assessments to Baa1(cr)/Prime-2(cr) from Baa3(cr)/Prime-3(cr), and its baseline and adjusted baseline credit assessments to "ba1" from "ba2."

The upgrades reflect the further material strengthening of Abanca's financial profile owing to its asset risk improvement, which the agency expects to continue on the back of Spain's positive economic performance. The ratings also reflect the significant reduction in the volume of the bank's nonperforming loans as well as Abanca's improved profitability, with recurrent earnings increasing since 2017, Moody's noted.

The bank's short-term bank deposit ratings were affirmed at Not Prime.