DBRS on June 9 downgraded the ratings of certain subordinated debt of 27 European banking groups by one notch.
The actions on the ratings, which were placed under review Jan. 13, conclude DBRS' review of global banking methodology.
DBRS said it had rated dated subordinated debt and cumulative junior subordinated debt issued by European banks at one notch below the issuer's intrinsic assessment, whereas noncumulative junior subordinated debt was rated two notches below the intrinsic assessment. Given increasing indications that all subordinated bank debt will be used alongside equity to absorb losses under the EU's Bank Resolution and Recovery Directive, DBRS opted to downgrade all subordinated debt to two notches below the intrinsic assessment.
While DBRS affirmed the ratings for Bank of Ireland's dated subordinated debt, which was already rated two notches below the intrinsic assessment, the agency downgraded certain subordinated debt for: Belfius Banque SA, BNP Paribas SA, DZ BANK AG, Landesbank Berlin AG, Deutsche Pfandbriefbank AG, Banca Sella SpA, Banco BPM SpA, Credito Valtellinese SpA, Intesa Sanpaolo SpA, Unione di Banche Italiane SpA, ABN AMRO Bank NV, Millennium BCP, BCP Finance Bank Ltd., Caixa Económica Montepio Geral, Caixa Geral de Depósitos SA, Caixa Geral de Depósitos France branch, Banco Bilbao Vizcaya Argentaria SA, Banco de Sabadell SA, CaixaBank SA, Banco Santander SA, Santander Central Hispano Financial Services, Ltd., Santander Issuances SA Unipersonal, Santander Financial Issuances Ltd., Santander Perpetual SA, Nordea Bank AB (publ), Nordea Bank AB Finland branch, Skandinaviska Enskilda Banken AB, Svenska Handelsbanken AB (publ), Credit Suisse AG, Credit Suisse USA, Inc., Credit Suisse Group Finance (Guernsey) Ltd., Credit Suisse Group Finance (U.S.), Inc., Barclays Bank Plc, Lloyds Banking Group Plc, Lloyds Bank Plc, Bank of Scotland Plc, HBOS Plc, Royal Bank of Scotland Group Plc and Nationwide Building Society.