...Support Drives Most Ratings: Most of the Issuer Default Ratings (IDRs) for German banks are at their Support Rating Floors (SRFs), based on Fitch Ratings view of a strong likelihood that state support will continue to be available if and when needed to prevent senior creditors incurring any losses. For these banks, the SRF is at a higher rating level than the banks would have on the basis of their standalone creditworthiness, measured by the Viability Rating (VR). Strong History of Support: SRFs are based on the strong financial flexibility of the German sovereign (rated ,,AAA) and its strong track record of supporting banks. Reasons for support include: systemic importance and connectivity with the broader economy; the importance of the Pfandbrief market and unwillingness to test protection given by the Pfandbrief law; the extensive creditor protection provided by the various institutional solidarity and deposit protection schemes; and the need to monitor the orderly wind-down of non-strategic...
