Fitch ups Banco Popular to A-, cuts VR

Fitch Ratings said it affirmed Banco Santander, SA's long-term issuer default rating at A- and its viability rating at a-.

The outlook is stable.

At the same time, the agency upgraded Banco Popular Espanol, SA's (Popular) long-term issuer default rating to A- from B with a stable outlook.

It also downgraded Popular's viability rating to f from b following the European Central Bank's (ECB) decision to put Popular into resolution and subsequently withdrew the viability rating as the bank can no longer be assessed on a standalone basis.

Fitch said the actions follow the June 7 announcement that Santander acquired 100% of the shares of Popular at the price consideration of €1 as part of a resolution organized by the Single Resolution Board (SRB). Prior to the sale, the preferred stock and perpetual Tier 1 convertible notes issued by Popular were fully written down and subordinated debt (lower tier 2) was converted into equity. Santander will raise €7 billion of capital to fund the acquisition.

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