The Spanish savings bank Cajasur has asked the European Central Bank (ECB) for an extra 200 million ($ 275.7 million) following Fitch Rating‘s downgrade last month of the banks long-term ratings, according to market reports.
In April, Fitch cut the ratings of Cajasur to ‘BB+’ from ‘BBB+’. This prompted the bank to early amortize AyT Bonos Tesoreria, FTA’s notes, a cash flow securitization of senior unsecured bonds trying to secure funding for Spanish financial entities with a nominal of 200 million and maturity in 2013.
The rating downgrade reflects a high probability of non-payment. It also shows the negative impact of the rapidly declining Spanish economy and real estate sector on Cajasur’s activity.
The arrears rate of Cajasur was 6.55% at the end of March 2009, while the risk-coverage rate stood at 42.7%, down from 129.3% in March 2008.