Moody’s upgraded four covered bond programmes – of Alpha Bank, Eurobank Ergasias and National Bank of Greece – on Friday, after having raised the Greek local currency ceiling from B3 to Ba3 on 1 August in the wake of a sovereign upgrade from Caa3 to Caa1.

Three programmes were upgraded from B3 to B1: mortgage covered bonds issued by Alpha Bank, which has an adjusted baseline credit assessment (BCA) of caa2; mortgage covered bonds issued off the Covered Bond Programme I of Eurobank Ergasias, which has an adjusted BCA of caa3; and mortgage covered bonds issued off the Global Covered Bond Programme I of National Bank of Greece (NBG), which has an adjusted BCA of caa2.

Mortgage covered bonds issued off NBG’s Covered Bond Programme II were upgraded from B3 to Ba3.

Moody’s said that the ratings of the covered bonds that were upgraded to B1 are capped by Timely Payment Indicators (TPIs) of “very improbable”.

The TPI of the NBG CB II programme is “improbable” because the covered bonds benefit from an extension period of around 35 years, it added, and their new Ba3 rating is capped by the local currency ceiling.

The relevant ratings of the issuers are lower than those listed in Moody’s published TPI table and in such instances the rating agency takes a decision on the TPI cap on a case by case basis.

Moody’s actions did not affect the rating of Covered Bond Programme II of Eurobank Ergasias, which are rated B3, because the rating agency’s expected loss analysis limits the rating at that level, it said.