Fitch upgrades Kutxabank to BBB+

Fitch Ratings said it upgraded Kutxabank, SA’s long-term issuer default rating to BBB+ from BBB, short-term issuer default rating to F2 from F3, viability rating to bbb+ from bbb, senior unsecured debt long-term rating to BBB+ from BBB and senior unsecured debt short-term rating to F2 from F3.

The outlook on the long-term issuer default rating was revised to stable from positive.

Fitch said the upgrades reflect Kutxabank's robust loss-absorption capacity, the progress it has made in reducing problem assets and equity investments, and Fitch's expectation that these will be reduced further. While its assessment of capitalization is a key rating driver, the agency said the ratings also factor in: The bank's modest profitability; high, albeit declining, concentrations by name (particularly related to a few large equity investments); and Kutxabank's adequate funding and liquidity.

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