...Integration Is Well Advanced: Unicaja Banco S.A.'s ratings reflect its sound regional franchise, progress in achieving planned synergies on the integration of EspanaDuero (ED), adequate capital metrics, and comfortable funding and liquidity. The ratings also factor in the bank's weak, albeit improving, asset quality and modest profitability. Improved Capital Position on IPO: Unicaja completed a EUR756 million capital increase in 2017 through an initial public offering (IPO). This allowed the bank to repay outstanding state contingent convertible bonds (CoCos) issued by ED and held by the Fund for Orderly Bank Restructuring (FROB), and acquire the latter's stake in ED. The capital increase also boosted the group's capital ratios. Strong Regional Franchise: The group's national market share is small, but it has a leading presence in parts of Andalusia and Castille and Leon. This provides Unicaja with a cheap and sticky retail deposit base, and some pricing power on the sale of loan, asset...
