...Support-Driven IDRs: The Long-Term IDR of Grupo Cooperativo Cajamar (GCC) is at its Support Rating Floor (SRF). This is based on Fitch Ratings' belief that there is a moderate probability of state support, if required. The SRF reflects GCC's regional systemic importance to Spain. The Negative Outlook reflects a potential reduction of state support due to the EU's Bank Recovery and Resolution Directive (BRRD) and the Single Resolution Mechanism (SRM). Better Fundamentals: GCC's credit fundamentals improved in 3Q14 as problem assets reduced and the group strengthened provisions. However, the Viability Rating (VR) still reflects the group's weaker asset-quality than the sector average and the relatively large stock of unreserved problem assets. CGC also faces the challenge of improving its low profitability. Improved NPL Reserve Coverage: Foreclosures, write-offs and recoveries outpaced net new non-performing loans (NPLs) in 3Q14. However, GCC's NPL ratio remained high, at 17.9% at end-3Q14...
