Fitch Ratings has upgraded Bank of Cyprus €650 million outstanding conditional pass-through (CPT) covered bonds to BBB+ from BBB and removed it from Rating Watch Positive. The Outlook is Stable.
According to a Fitch press release, the rating action reflects the upgrade of Cyprus’s Country Ceiling to BBB+, which is now the maximum achievable rating for BoC’s covered bonds, from BBB.
Following the upgrade of the Country Ceiling, Fitch has updated certain assumptions for Cypriot residential mortgage assets to reflect the higher stress scenario in line with Fitch’s Structured Finance and Covered Bonds Country Risk Criteria.
The upgrade also reflects the availability of line-by-line borrower income information that the issuer has delivered since end-2017, accounting for around 87% of the cover pool in March 2018.