Valuable retail franchise in Spain. Management's proven execution capabilities of successfully implementing strategic and integration plans. Likelihood of Sabadell receiving state assistance if needed, given its high systemic importance in Spain. Higher credit risk than peers. Modest capitalization, albeit improving. Still subdued operating profitability. The negative outlook primarily reflects that we might lower the ratings on Sabadell by one notch by year-end 2015 if we consider that extraordinary government support is less predictable under the new EU legislative framework. We could remove the one-notch uplift for potential extraordinary support, which we currently incorporate into the ratings, shortly before the January 2016 introduction of bail-in powers under the European Union's Bank Resolution and Recovery Directive (BRRD) for senior unsecured liabilities. The
