Regulated bank status, hosting Volkswagen's European banking activities. Very strong capitalization and solid revenue generation. A stable retail deposit base. New business dependence on the parent's auto sales. Concentrated exposure and volatility in the car finance business. Potential rating constraints from the relatively weaker parent group. The negative outlook on Volkswagen Bank GmbH (VW Bank) reflects the possibility of a downgrade over the next two years, mirroring S&P Global Ratings' negative trends for economic and industry risk in its Banking Industry Country Risk Assessment on Germany. It also reflects our negative outlook on Volkswagen AG (VW; BBB+/Negative/A-2), and additional pressures from COVID-19 on VW Bank's risk exposures and risk-adjusted profitability. Moreover, VW Bank has not fully finalized its strategic reorganization
