Fitch upgraded Laboral Kutxa cédulas hipotecarias from A- to A+ on Friday after a one notch upgrade of the issuer the day before.

Fitch upgraded the issuer default rating (IDR) rating of Caja Laboral Popular Cooperativa de Crédito from BBB to BBB+ on Thursday to reflect an improvement in the bank’s standalone creditworthiness.

The covered bond rating is based on the BBB+ IDR, an IDR uplift of 1, a Discontinuity Cap of 0, and overcollateralisation of 131%, with Fitch putting breakeven OC at 52%.

“There is a significant cushion against a decrease in the 131% OC, which Fitch takes into account in its analysis,” said the rating agency.

The rating agency assigns an IDR uplift of 1 to Laboral Kutxa’s covered bond programme, which reflects amendments to its rating criteria to take into account covered bonds’ exemption from bail-in under the Bank Recovery & Resolution Directive (BRRD).

“The IDR uplift is supported by the agency’s opinion of Spain being a covered bonds-intensive jurisdiction,” said Fitch.