Spain-based Abanca Corporacion Bancaria S.A. (Abanca) recent issuance of €375 million of additional Tier 1 notes (AT1), as well as its likely decision to abandon plans to acquire Banco BIC Portugues S.A. (Eurobic) has strengthened the bank's capital position. While the impact of the pandemic-induced downturn is yet to affect credit quality, we believe Abanca's strengthened capitalization will help the bank withstand expected deterioration or slower recovery of the economic environment. We are thus revising the outlook on Abanca to stable from negative. The stable outlook reflects that, over the next 12-18 months, we expect Abanca's capitalization will sufficiently withstand the expected asset quality erosion and potentially more fragile economic conditions than we currently forecast. On Feb. 10, 2020, S&P
