Salzburg-based Bausparkasse Wüstenrot AG’s AAA covered bond ratings reflect a seven-notch rating uplift from the building society’s private issuer rating. Cover pool support is the primary rating driver and factors in a cover pool complexity category of ‘Low’ to the interplay between complexity and transparency; the 22.5% of overcollateralisation as of 31 March 2023, on an eligible-loan basis; the low risk profile cover pool, solely comprising residential and domestic cover assets with a low averaged unindexed eligible loan-to-value ratio of about 51.5%; and moderate asset liability mismatches.

Governance support provides a credit support of up to five notches. This effectively provides a floor against a deterioration in the cover pool’s credit quality.

Scope’s Stable Outlook on the covered bonds reflects the outlook on the private issuer rating enhanced by a rating buffer of one notch from unused cover pool support.

This is not a rating action. On 10 May 2023, Scope affirmed the covered bonds at AAA/Stable. Click here for the corresponding press release.

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