...VR-Driven IDRs: Grupo Cooperativo Cajamar (GCC)'s IDRs are driven by its standalone creditworthiness as reflected by its Viability Rating (VR). The VR factors in its weak asset quality indicators, large unreserved problem assets relative to capital and the challenge to improve its low profitability. The VR also takes into account its improved funding and liquidity. The Stable Outlook on GCC's Long-Term IDR assumes that the bank will continue to focus on managing down its problem assets, a trend already visible since end-2013. Asset Quality Improving: In 2014, GCC slightly reduced the stock of problem loans as recoveries, write-offs and foreclosures outpaced new non-performing loans (NPLs) entries while it boosted the NPL reserve coverage to 50% at end-2014 (44% at end-2013). However, the problem asset ratio at end-2014 (which includes NPL and foreclosed assets) was still high at 21.4%, and weaker than the sector average. Fitch expects GCC's asset quality to benefit from Spain's economic...
