September 13, 2012 / 4:00 PM / 5 years ago

TEXT-S&P raises Banco de Sabadell S.A. ratings

(The following statement was released by the rating agency)
    
-- On Sept. 12, 2012, Banco de Sabadell S.A. (Sabadell) announced the 
completion of its offer to repurchase series I/2006 preferred securities and 
series I/2006 and I/2010 nondeferrable subordinated debt securities.
     -- We are raising our issue ratings on the remaining preferred stock to 
'B-' from 'C' and on the remaining nondeferrable subordinated debt to 'B+' 
from 'D'.
     -- Today's action doesn't affect the counterparty credit ratings or any 
other issue ratings on Sabadell.



Sept 13 - Standard & Poor's Ratings Services said today that it has raised its
issue ratings to 'B-' from 'C' on the remaining series I/2006 preferred stock
issued by Spain-based Banco de Sabadell S.A. (Sabadell) and to 'B+' from 'D' on
its remaining series I/2006 and I/2010 nondeferrable subordinated debt.

The rating action follows the bank's announcement on Sept. 12, 2012, that it 
had completed its Sept. 3, 2012, tender offer launched to repurchase part of 
its outstanding preferred stock and nondeferrable subordinated debt securities 
(including the abovementioned securities). This action doesn't affect the 
counterparty credit ratings or any other issue ratings on Sabadell.

In our media release on Sept. 5, 2012, we said that we considered Sabadell's 
tender offer to be a "distressed exchange" under our criteria. According to 
our criteria, we lowered our issue ratings to 'C' on the preference shares and 
to 'D' on the nondeferrable subordinated debt (see "Sabadell's Hybrid And 
Subordinated Debt Downgraded To 'C' and 'D' On Distressed Exchange; No Other 
Ratings Affected"). We also stated that we would review our issue ratings on 
any securities subject to the offer that hadn't been purchased upon completion.

On Sept. 12, 2012, Sabadell announced it had completed its offer and that it 
had accepted to repurchase a total amount of EUR109 million, of which EUR65 
million correspond to the abovementioned rated securities. Following the 
settlement of the purchase, the remaining outstanding amount of series I/2006 
preferred stock and series I/2006 and I/2010 nondeferrable subordinated debt 
will be EUR23.9 million, EUR221.9 million, and EUR425.9 million, respectively.

We have reviewed our issue ratings on the securities that weren't purchased 
after the completion of the tender offer, and have decided, based on our 
criteria, to raise the ratings to 'B-' on the preferred stock and to 'B+' on 
the nondeferrable subordinated debt, in line with the pre-tender offer ratings 
(see "Rating Implications Of Exchange Offers And Similar Restructurings, 
Update," published on May 12, 2009, and "Bank Hybrid Capital Methodology And 
Assumptions," published on Nov. 1, 2011). 

In accordance with our criteria, our issue ratings on the preference shares 
and nondeferrable subordinated debt are derived from Sabadell's stand-alone 
credit profile, which we assess at 'bb'.


RELATED CRITERIA AND RESEARCH
     -- Sabadell's Hybrid And Subordinated Debt Downgraded To 'C' and 'D' On 
Distressed Exchange; No Other Ratings Affected, Sept. 5, 2012
     -- S&P Says Lowering Of Some Spanish Banks' Preference Shares Were Due To 
Increased Vulnerability Of Nonpayment, May 28, 2012
     -- Credit FAQ: Applying The Bank Hybrid Capital Criteria To Specific 
Instruments, Dec. 20, 2011
     -- Bank Hybrid Capital Methodology And Assumptions, Nov. 1, 2011
     -- Timeliness of Payments: Grace Periods, Guarantees, And Use Of 'D' And 
'SD' Ratings, Dec. 23, 2010
     -- Rating Implications Of Exchange Offers And Similar Restructurings, 
Update, May 12, 2009


RATINGS LIST

Upgrade
                                      To          From
Banco de Sabadell S.A.
Preferred Stock                       B-          C          
Subordinated Debt                     B+          D

 (Caryn Trokie, New York Ratings Unit)

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