Fitch Revises Outlooks on 12 Spanish Subnationals to Stable

Fri Nov 8, 2013 11:37am EST

BARCELONA, November 08 (Fitch) Fitch Ratings has revised the Outlooks on 12 Spanish local and regional governments to Stable from Negative and affirmed their Long- and Short-term ratings. Their respective bond issues/senior unsecured ratings have also been affirmed. This directly follows a similar rating action on the Kingdom of Spain's Issuer Default Rating (IDR) which was revised to Stable from Negative (see 'Fitch Revises Spain's Outlook to Stable; Affirms at 'BBB' dated 1 November 2013 at www.fitchratings.com). A full rating breakdown is provided at the end of the commentary. KEY RATING DRIVERS The Outlooks on Autonomous Communities of Castile La Mancha, Catalonia, Murcia and Valencia have been revised to Stable from Negative, in line with the sovereign rating action. This is because their ratings are supported by the rating floor of 'BBB-' for Spanish regions, whose Outlook has also been revised to Stable from Negative. Fitch earlier this year introduced a rating floor at one notch below the sovereign rating for all Spanish regions, which supports the ratings of some regions whose standalone credit metrics are weaker than their present ratings would indicate. The Autonomous Communities of Andalusia and the Canary Islands did not benefit from the floor rating. However, the Outlooks of their 'BBB-' rating have also been revised to Stable from Negative as a direct consequence of the revision of the Outlook to Stable from Negative of the rating floor on Spanish regions. The Outlooks on the three Basque Historical Territories (Alava, Bizkaia and Gipuzkoa) have been revised to Stable from Negative to reflect the headroom freed by the Sovereign Outlook revision since the ratings of those entities are constrained at two notches above the ratings of the sovereign. The Outlooks on the Cities of Barcelona, Madrid and Pamplona have been revised to Stable from Negative as their ratings are capped by the sovereign. The rating actions are as follows: Historical Territory of Alava Long-term foreign and local currency ratings of 'A-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F1'affirmed Autonomous Community of Andalusia Long-term foreign and local currency ratings of 'BBB-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F3' affirmed City of Barcelona Long-term foreign and local currency ratings of 'BBB' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F2' affirmed Historical Territory of Bizkaia Long-term foreign and local currency ratings of 'A-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F1' Autonomous Community of the Canary Islands Long-term foreign and local currency ratings of 'BBB-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F3' Autonomous Community of Castile-La Mancha Long-term foreign and local currency ratings of 'BBB-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F3' affirmed Autonomous Community of Catalonia Long-term foreign and local currency ratings of 'BBB-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F3' affirmed Historical Territory of Gipuzkoa Long-term foreign and local currency ratings of 'A-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F1' affirmed City of Madrid Long-term foreign and local currency rating of 'BBB' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F2' affirmed Autonomous Community of Murcia Long-term foreign and local currency rating of 'BBB-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F3' affirmed City of Pamplona Long-term foreign and local currency rating of 'BBB' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F2' affirmed Autonomous Community of Valencia Long-term foreign and local currency rating of 'BBB-' affirmed; Outlook revised to Stable from Negative Short-term foreign currency rating of 'F3' Contact: Primary Analysts: Guilhem Costes (Alava, Bizkaia, City of Madrid, City of Pamplona, City of Barcelona, Valencia, Castile La Mancha, Andalusia, Canary Islands) Senior Director +34 93 323 84 10 Fitch Ratings Espana, S.A.U. Paseo de Gracia, 85 Barcelona 08008, Spain Ines Callahan (Gipuzkoa, Murcia, Catalonia) Associate Director +34 93 467 87 45 Fitch Ratings Espana, S.A.U. Paseo de Gracia, 85 Barcelona 08008, Spain Secondary Analysts: Guilhem Costes (Gipuzkoa, Murcia, Catalonia) Senior Director +34 93 323 84 10 Fernando Mayorga (Andalusia, Canary Islands, Castile la mancha, Valencia, City of Madrid) Managing Director +34 93 323 84 00 Ines Callahan (Alava, Bizkaia, Barcelona, Pamplona) Associate Director +34 93 467 87 45 Committee Chairperson Raffaele Carnevale Senior Director +39 02 87 90 87 203 Media Relations: Peter Fitzpatrick, London, Tel: +44 20 3530 1103, Email: peter.fitzpatrick@fitchratings.com. Additional information is available on www.fitchratings.com Applicable criteria, 'Tax-Supported Rating Criteria', dated 14 August 2012, 'International Local and Regional Governments Rating Criteria outside United States', dated 9 April 2013 and 'Rating Subnationals above the Sovereign' dated 2 May 2012, are available on www.fitchratings.com. Applicable Criteria andALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.