July 31, 2009 at 7:59 am #55136
Given the state of the Spanish property market I´m somewhat surprised this has taken so long.
July 31, 2009 at 8:43 am #93750
Wish they would do it again, their share price is rising faster than any other.
July 31, 2009 at 10:13 am #93754
I don’t like to give company names…
But this time, as so many times, you have misunderstand the information.
Yes, Moody have downgraded Santander and BBVA (biggest Spanish banks).
But still both enjoy the higher rate in the west world, the same rate that only enjoy HSBC (UK) and Society Generale (France),…not the others European or American banks.
This year as last year, both banks are the west banks with higher benefits,…about 9.000 millions euros, that’s why they didn’t need any Government support …and that’s what the stock market is picturing.
July 31, 2009 at 12:55 pm #93764
All grading or degrading in the present climate is a relative. I shares trees posting & comments.
July 31, 2009 at 5:28 pm #93766
Relative or not it has a real bearing on the banks bottom line….
The lower the rating….
…the higher the interest it has to pay to other banks to borrow money as it is perceived as a greater risk.
…the more likely companies, governments -both local and national – and institutions are to move money out of them. Many did so out of Landesbanki before its demise on the basis of its credit rating being downgraded.
…the less a bank is worth to potential purchasers in the event of difficulty.
Now I do agree that to mere mortals such as us this is generally not a cause for concern. IMO Santander is one of those banks that is too big to be allowed to fail.
Where it is however particularly relevant to this forum is that, given the downgrade, they may well be forced to offload properties with delinquent loans on them faster than they would like to. That could impact the whole market.
Only time will tell.
July 31, 2009 at 6:27 pm #93767
With a Aa2 rate, nothing of what you said is going to happen…
Anyway to be honest, the pretty healthy picture of the major Spanish Banks,…is not unfortunately the picture of the Spanish economy…
July 31, 2009 at 7:20 pm #93768
What I meant by relative is that things are in such a flux that AAA, of few years in today’s market is very different. I agree that their borrowing etc will be affected.
Its like individuals having a bad credit record at Experian or other such industry.
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