...IDR Reflects Ownership: BBVA USA Bancshares, Inc. (BBVA USA) is a wholly owned subsidiary of Banco Bilbao Vizcaya Argentaria (BBVA), rated `A¡'/F2 by Fitch Ratings. BBVA USA's Issuer Default Rating (IDR) is notched one below that of its parent and accounts for approximately 14% of consolidated parent revenue. Earnings Performance Lags Peers: Fitch notes that BBVA USA's earnings performance continues to lag that of the large regional bank peer group and is considered a key viability rating (VR) constraint. Historically, the cost of deposits has driven some of the weakness in performance, but BBVA USA's net interest margin (NIM) has converged with the peer average. BBVA USA's ROA improved in 2018 to 86 bps but has fallen to 65 bps in 1H19 driven by limited NIM compression. Good Capital Profile: BBVA USA's capital profile remains solid, with a Common Equity Tier 1 ratio (CET1) of 12.57% at June 30, 2019. This represents an increase of 57 bps from YE18. This is well above the median for the...
