...Lower Default Expectations: Fitch Ratings has reduced the annual average default expectation on typical Spanish SME loan portfolios to 5.0% from 6.25%. This is mainly driven by reduced default rates on loans in the real estate and construction sectors (to 8% from 10%), and the reduced weighting of these sectors within a typical portfolio composition. Lower default expectations are also supported by improved access to financing, structural and legal reforms, and expanding cross-border businesses. Real Estate re-Balanced: The dependence of the Spanish economy on the real estate and construction (RE&C) sectors has significantly decreased in terms of employment, value added and outstanding credit. Although the outlook of the sector remains weak, reduced exposure to RE&C makes typical SME portfolios less vulnerable to local demand shocks. Rising Exports Increase Competitiveness: The number of Spanish companies exporting goods and services was almost 150,000 in 2014, more than 50% higher than...
