Fitch: Covered Bonds Show Slowdown of Negative Rating Trend

(The following statement was released by the rating agency)

Link to Fitch Ratings' Report: Covered Bonds Surveillance Snapshot January 2014

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=733838

LONDON, February 07 (Fitch) In its latest Covered Bonds Surveillance Snapshot, 
Fitch Ratings says that 4Q13 witnessed a slowdown of negative rating trend in 
covered bonds, with upgrades exceeding downgrades by 6 to 3.

While downgrades (25) still exceeded upgrades (13) for the whole of 2013, rating 
performance was nevertheless more balanced than the year before. In 2012 there 
were more than twice the number of downgrades (61), which represented multiple 
actions on the same rating, and barely any upgrades (3). As a result, the 
updated average annual rating transition for 2006-2013 was stabilising compared 
with the period 2006-2012.

As of 1 January 2014, Fitch rated 132 covered bonds programmes in total, issued 
out of 21 different countries. Most of them were secured by traditional assets 
eligible to covered bonds funding, such as mortgage loans (83%) and public 
sector debt (16%). Around 60% of the portfolio carried a 'AAA' rating, and less 
than 5% was speculative-grade. Nearly 80% of covered bonds ratings have a Stable 
Outlook.

Fitch's 4Q13 covered bonds surveillance snapshot, together with an excel version 
of the same document to facilitate downloads of key characteristic and credit 
metrics for each covered bonds programme, is available on www.fitchratings.com 
or by clicking on the link above. 

Contact: 

Beatrice Mezza

Senior Director

+ 44 20 3530 1273

Fitch Ratings Limited

30 North Colonnade

London E14 5GN

Helene M. Heberlein

Managing Director

+33 1 44 29 91 40

Media Relations: Christian Giesen, Frankfurt am Main, Tel: +49 69 768076 232, 
Email: christian.giesen@fitchratings.com.

Additional information is available on www.fitchratings.com.

Applicable Criteria and Related Research: 

2014 Outlook: Covered Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=725396

Exposure Draft: Impact on Covered Bond Rating Criteria From Advances in Bank 
Resolution Frameworks

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=726871

Covered Bonds Surveillance Snapshot January 2014 - Excel File

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735678

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