Overcollateralization has increased significantly as a result of the maturities and early redemptions of the mortgage covered bonds (cédulas hipotecarias; CHs). Available credit enhancement significantly exceeds the target credit enhancement at present. The issuer's conservative mortgage loan underwriting and servicing policies. Better performance of the residential mortgage loan book than that of most other rated Spanish covered bond issuers. Lower-than-average credit metrics. This results from the mortgage book's better-than-average credit quality and updated reported information, which takes into account house price index movement in Spain. Weaknesses The program's exposure to asset-liability mismatch (ALMM) risk has increased since November 2012. This is due to the concentration of the covered bonds that are set to mature in the next three years. The
