Research Update: Spain-Based Banco Popular Espanol Long-Term Rating Lowered To 'BBB+' On Bank Criteria Change; Still On Watch Negative Dec 11
- Language: English
- Published: December 2011
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Research Type: Full Analysis
The ratings on Banco Popular Espa-ol S.A. (Popular), the highest assigned to a private bank in Spain, reflect the bank's strong financial fundamentals--in particular its excellent earnings record, sound asset quality, and good (albeit declining) capitalization. They also reflect management's coherent and conservative strategy. Popular's strong and resilient profitability is indisputably one of the bank's major financial strengths and a source of great financial flexibility. The bank's ability to maintain average returns at a high 1.6% of average assets over the past three years is quite an achievement, considering the challenge of operating in a historically low interest rate environment and the need to comply with more stringent mandatory credit provisions. Popular's outstanding performance--a combination of the bank's focus on...
Companies mentioned in this report are: Banco Popular Espanol, S.A.