Transaction Update: Kommunalkredit Austria AG (Public Sector Covered Bonds)

Very strong jurisdictional support assessment. Majority of the cover pool assets are located in Austria. High concentration of Austrian local and regional governments in the cover pool, which we reflect in our analysis. The derivatives replacement framework, which is not in line with our current counterparty criteria, caps our rating on the program at 'A'. The stable outlook on our covered bonds ratings reflects our view of the credit strength of the issuer. On June 13, 2017, S&P Global Ratings assigned its 'A' credit ratings to Kommunalkredit Austria AG's public sector covered bond program and related issuances of "Fundierte Bankschuldverschreibungen" (see "Kommunalkredit Austria's Public Sector Covered Bonds Assigned 'A' Ratings; Outlook Stable"). Our covered bond ratings process follows the methodology

...*The overcollateralization needed for the 'A' rating represents our 'hard' credit enhancement floor at 'A', or 1.50%. It is the minimum required credit enhancement to achieve the current 'A' rating, on the sole basis of the available jurisdictional support....

Transaction Update Report