TEXT-S&P affirms BBVA USA Bancshares 'BBB/A-2' ratings
(The following statement was released by the rating agency)
May 25 - Overview
-- On May 25, 2012, we affirmed our 'BBB+/A-2' long- and short-term ratings on Banco Bilbao Vizcaya Argentaria S.A. (BBVA S.A.) and removed the ratings on the subordinated and Tier 1 hybrid notes from CreditWatch negative.
-- In our view, the strategic importance of BBVA USA Bancshares Inc. (BBVA USA) and subsidiary Compass Bank to their parent, BBVA S.A., is high under our group methodology criteria.
-- As a result, we are affirming our 'BBB/A-2' ratings on BBVA USA and Compass Bank and removing the relevant subordinated and preferred ratings from CreditWatch negative.
-- The outlook on the long-term ratings on BBVA USA and Compass Bank is negative, reflecting the outlook on their parent. Rating Action On May 25, 2012, Standard & Poor's Ratings Services affirmed its 'BBB/A-2' long- and short-term issuer credit ratings on BBVA USA Bancshares Inc. (BBVA USA) and Compass Bank. The outlook on the long-term ratings remains negative. We also affirmed the subordinated and preferred ratings on BBVA USA's subsidiaries and removed them from CreditWatch, where they were placed with negative implications on April 30, 2012. Rationale We affirmed our ratings on BBVA USA and Compass Bank following our affirmation of the ratings on the parent, Banco Bilbao Vizcaya Argentaria S.A. (BBVA S.A.; BBB+/Negative/A-2), on May 25. Based on our group methodology criteria, we consider these rating actions linked because we view BBVA USA's strategic importance to its parent as high. Our stand-alone credit profile (SACP) for BBVA USA remains 'bbb'. The affirmation of our ratings on BBVA S.A. follows our review of the wider implications of our two-notch downgrade of the Kingdom of Spain (BBB+/Negative/A-2) for the Spanish banking sector. Consequently, we have maintained our Banking Industry Country Risk Assessment on Spain at group '5', and revised our economic risk score to '6' from '5'. We affirmed our subordinated and preferred ratings on BBVA USA subsidiaries and removed them from CreditWatch, in line with the actions on the subordinated and preferred ratings on the parent following our Spanish banking industry review. Outlook The negative outlook on BBVA USA reflects the outlook on its parent, BBVA S.A., which, in turn, mirrors the negative outlook on Spain. In addition, it reflects our view that BBVA S.A. may underperform our financial expectations, in the context of the still fragile and uncertain European economic and financial environment, particularly in Spain. Because we view BBVA USA and Compass Bank as highly strategic subsidiaries of BBVA S.A., any downgrade of the Spanish parent would very likely lead to corresponding downgrades of these U.S. subsidiaries. Ratings Score Snapshot Bank Holding Company Rating BBB/Negative/A-2 Issuer Credit Rating BBB/Negative/A-2 SACP bbb Anchor bbb+ Business Position Adequate (0) Capital and Earnings Adequate (0) Risk Position Moderate (-1) Funding and Liquidity Average
and Adequate (0) Support 0 GRE Support 0 Group Support 0 Sovereign Support 0 Additional Factors 0 Related Criteria And Research
-- Spain-Based BBVA 'BBB+/A-2' Ratings Affirmed Following Spanish Banking Sector Review; Outlook Negative, May 25, 2012
-- For U.S. Large Regional Banks, Strengthening Asset Quality Supported An Improvement In First-Quarter Results, May 11, 2012
-- BBVA USA Bancshares Inc. Long-Term Rating Lowered To 'BBB' From 'A-'; Outlook Is Negative, April 30, 2012
-- Negative Rating Actions On 16 Spanish Banks Following Sovereign Downgrade, April 30, 2012
-- Ratings On Spain Lowered To 'BBB+/A-2' On Debt Concerns; Outlook Negative, April 26, 2012
-- Group Rating Methodology And Assumptions, Nov. 9, 2011
-- Bank Hybrid Capital Methodology, Nov. 1, 2011 Ratings List Ratings Affirmed BBVA USA Bancshares Inc. Counterparty Credit Rating BBB/Negative/A-2 Compass Bank Counterparty Credit Rating BBB/Negative/A-2 Certificate Of Deposit BBB/A-2 Ratings Affirmed; CreditWatch Action
To From Compass Bank Subordinated BBB- BBB-/Watch Neg Compass Loan Holdings Inc. Preferred Stock BB BB/Watch Neg Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column. (New York Ratings Team)
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