TEXT-S&P: 2 more Latin American BBVA subs unaffected by downgrade

Tue Oct 16, 2012 3:52pm EDT

Oct 16 - Standard & Poor's Ratings Services said today that the issuer
credit ratings on Banco Bilbao Vizcaya Argentaria Paraguay S.A. (BBVA Paraguay;
BB-/Stable/B) and BBVA Banco Frances S.A. (national scale rating
raAA/Negative/--) are not immediately affected by the downgrade of their parent,
Spain-based Banco Bilbao Vizcaya Argentaria S.A. (BBVA; BBB-/Negative/A-3). (For
more information on the rating action on BBVA, see "Various Rating Actions On
Spanish Financial Institutions Following Sovereign Downgrade," published Oct.
15, 2012, on RatingsDirect on the Global Credit Portal.)

The issuer credit ratings on BBVA Paraguay and BBVA Banco Frances continue to 
reflect the companies' stand-alone credit profiles (SACPs) and do not reflect 
any uplift for group support, since the ratings are at the sovereign level. 
Further downgrade of BBVA would most likely not affect the ratings on these 
subsidiaries, given the gap between their SACPs and the ratings on BBVA. 

We classify the governments of Paraguay and Argentina as "support uncertain" 
under our bank criteria methodology (see "Banks: Rating Methodology And 
Assumptions," published Nov. 9, 2011). For that reason, and despite the high 
systemic importance of BBVA Banco Frances and BBVA Paraguay, respectively, the 
issuer credit ratings on these banks do not factor extraordinary government 
support. 

As a result, the ratings on these two subsidiaries continue to be tied more to 
the evolution of the ratings on the parent and the SACP on each company. We 
will continue to monitor BBVA's creditworthiness and its impact on the 
subsidiaries' SACPs, financial and dividend policies, liquidity and funding, 
and related party transactions.
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