Press Release

DBRS Confirms ICO’s Long-Term Ratings at A, Stable Trend

Banking Organizations
March 27, 2019

DBRS Ratings GmbH (DBRS) confirmed Instituto de Crédito Oficial’s (ICO or the Bank) ratings, including the Long-Term Issuer Rating at A and the Short-Term Issuer Rating at R-1 (low). All ratings have Stable Trend. ICO’s Support Assessment remains SA1. See a full list of ratings at the end of this press release.

KEY RATING CONSIDERATIONS
The confirmation of ICO’s Long-Term Issuer Rating at “A” stable trend follows DBRS’ confirmation of the Kingdom of Spain Long-Term Foreign and Local Currency rating at “A” with Stable trend on March 22, 2019. ICO’s ratings reflect its statutory ownership and the full guarantee of its liabilities by the Kingdom of Spain as stated in its by-laws under the Royal Decree Act 706/1999. As a result, DBRS’ support assessment for ICO is SA1 and ICO’s issuer ratings and trend are equalized with the Long-Term and Short-Term Foreign and Local Currency ratings of the Kingdom of Spain and will move in line with the rating of the Spanish sovereign.

RATING DRIVERS
The Long-Term and the Short-Term ratings move in line with the ratings of the Kingdom of Spain. An upgrade of the Kingdom of Spain would result in a positive rating action for ICO. Similarly, a downgrade of the Kingdom of Spain would result in a negative rating action for ICO.

RATING RATIONALE
ICO is a credit institution by law and is considered to be a State Finance Agency of Spain. It benefits from an explicit, irrevocable, unconditional and direct guarantee of its liabilities from the Kingdom of Spain that is stated in its by-laws under the Royal Decree Act 706/1999. As a public specialized lending institution and the state’s financial agency, ICO enjoys a unique and dominant franchise in Spain which contributes to support its current rating. Moreover, the ratings also consider ICO’s limited business scope, constrained by its business model and its high dependence on the Spanish Government.

Notes:
All figures are in Euros unless otherwise noted.

The principal applicable methodology is DBRS Criteria: Guarantees and Other Forms of Support (January 2019) and the Global Methodology for Rating Banks and Banking Organisations (July 2018). These can be found can be found at: http://www.dbrs.com/about/methodologies

The sources of information used for this rating include SNL Financial and company reports. DBRS considers the information available to it for the purposes of providing this rating to be of satisfactory quality.

DBRS does not audit the information it receives in connection with the rating process, and it does not and cannot independently verify that information in every instance.

Generally, the conditions that lead to the assignment of a Negative or Positive Trend are resolved within a twelve month period. DBRS’s outlooks and ratings are under regular surveillance.

For further information on DBRS historical default rates published by the European Securities and Markets Authority (“ESMA”) in a central repository, see:
http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml.

Ratings assigned by DBRS Ratings GmbH are subject to EU and US regulations only.

Lead Analyst: Pablo Manzano – Vice President - Global FIG
Rating Committee Chair: Elisabeth Rudman, Managing Director, Head of EU FIG, Global FIG
Initial Rating Date: February 25, 2013
Most Recent Rating Update: October 5, 2018

DBRS Ratings GmbH, Sucursal en España
Calle del Pinar, 5
28006 Madrid
Spain

DBRS Ratings GmbH
Neue Mainzer Straße 75
60311 Frankfurt am Main Deutschland

Geschäftsführer: Detlef Scholz
Amtsgericht Frankfurt am Main, HRB 110259

For more information on this credit or on this industry, visit www.dbrs.com

ALL DBRS RATINGS ARE SUBJECT TO DISCLAIMERS AND CERTAIN LIMITATIONS. PLEASE READ THESE DISCLAIMERS AND LIMITATIONS AND ADDITIONAL INFORMATION REGARDING DBRS RATINGS, INCLUDING DEFINITIONS, POLICIES, RATING SCALES AND METHODOLOGIES.