Strong support of majority shareholder, the Canton of Vaud (A/Stable/--), which--despite the absence of a formal guarantee--has provided substantial capital support; Improved asset quality and capitalization; and Strong positioning in its regional market. Weaker quality of capital due to the inclusion of bearer participation certificates (BPCs), which represent more than half of total share capital; the gradual buyback of BPCs, begun recently, should contribute to improved quality of capital in the long term, however. The ratings on Banque Cantonale Vaudoise (BCV) are underpinned by the Canton of Vaud's proven commitment to provide capital support to the bank in times of need, despite the absence of a formal guarantee. The ratings also reflect the tangible improvement in BCV's profitability, which has
