Large franchise and strong market position in its core market of Galicia. Lower than peers' problem assets from previous recession. Sizable and stable retail funding base and comfortable liquidity. High, albeit declining, regional geographic concentration. Weak operating profitability and efficiency, which the COVID-19 crisis will further aggravate. Tougher operating conditions could add pressure to its adequate capitalization. The negative outlook on Abanca indicates the possibility of a downgrade in the next 12-18 months if we anticipate that its capitalization could deteriorate more than expected on the back of heightened economic risks in Spain, or if the bank's performance proved weaker than we envisage, given that it does not have a strong earnings base to cushion potentially higher credit losses. We
