Covered bonds of BNP Paribas, Caffil, CFF and CIF Euromortgage could be cut from AA+ to AA, according to analysts, after Fitch downgraded France from AA+ to AA on Friday over concerns regarding its economy and increasing deficit.

The rating agency had placed France on Rating Watch Negative (RWN) in October and at that time said that the covered bond ratings of BNP Paribas Public Sector SCF, Caisse Francaise de Financement Local, Compagnie de Financement Foncier and CIF Euromortgage would likely be affected by any sovereign downgrade, due to their high exposure to the French sovereign and the French public sector and because prevailing levels of committed OC would also not be sufficient to sustain their AA+ ratings.

On Friday Fitch confirmed the one notch downgrade of the sovereign, while affirming its country ceiling at AAA.

Florian Eichert, senior covered bond analyst at Crédit Agricole, said that the covered bonds of each of the issuers identified by Fitch might now be downgraded to AA.