Moody's on May 25 upgraded Abanca Corporación Bancaria SA's long-term deposit ratings to Ba2 from Ba3 and revised the outlook to positive from stable.
The agency also upgraded Spanish the bank's baseline and adjusted baseline credit assessments to "ba2" from "ba3" and long- and short-term counterparty risk assessments to Baa3(cr)/Prime-3(cr) from Ba1(cr)/Not Prime(cr). The actions have no effect on the bank's short-term deposit ratings, Moody's added.
The actions reflect Moody's assessment that the bank's financial profile has further materially strengthened, mainly from its improving asset risk metrics. Although the upgraded baseline credit assessment also reflects improved liquidity profile, it also shows the bank's weak recurring profitability, the agency note.
Moody's said the positive outlook reflects the positive pressure that could develop on the ratings if the improving trend on the bank's credit fundamentals consolidates over the next 12 to 18 months.
