We now see higher economic risk for banks operating in Spain following the rapid deterioration of the sovereign's creditworthiness, which has been reflected in our rating actions on Spain, including our recent two-notch downgrade. In our view Spanish banks face increased credit risk as Spain's weakening economy, public sector cuts, austerity measures, and high unemployment will likely hamper the creditworthiness and resilience of public and private sector borrowers. In light of the higher credit risk in the economy, we believe Caixabank's capital position has deteriorated according to our methodology. This has resulted in a lowering of its stand-alone credit profile (SACP) to 'bbb-' from 'bbb', the same level as our issuer credit rating on the bank. We are affirming our
