The ratings on Oberoesterreichische Landesbank AG (Hypo OÖ) are based on the grandfathered deficiency guarantee (Ausfallsbürgschaft) of the bank's majority owner, the State of Upper Austria (Upper Austria; AAA/Stable/A-1+). Ratings on Hypo OÖ therefore reflect the credit quality of the State of Upper Austria. (For an analysis of the credit quality of the state, see full analysis on RatingsDirect, Standard&Poor's Web-based credit analysis system.) Although the deficiency guarantee is not a timely guarantee, Standard&Poor's believes that, as long as the state remains the majority owner and guarantor for all of the bank's obligations, it has a strong economic incentive to support the bank in a timely fashion as: The deficiency guarantee covers both full payment of
