Fitch downgrades Doral

Fitch Ratings said it has downgraded the ratings of Doral Financial Corp. and Doral Bank, including Doral Financial's long-term rating to BB- from BB+, individual rating to D from C/D, Doral Bank's long-term rating to BB from BBB-, individual to C/D from C and Doral Bank's short-term rating to B from F3.

The rating watch is negative.

This action follows the announcement that the Securities and Exchange Commission has issued a formal order of investigation into Doral and a further delay in their restated financials, Fitch said.

The action takes into consideration the possibility of deterioration in capital ratios but expects the company to remain well capitalized relative to quantitative regulatory standards, Fitch said.

Fitch's primary incremental concern is at the holding company, where Doral is not in compliance with covenants in two bond indentures relating to the timely filing of financial statements due to the delay in the restatement of its financials, Fitch said.

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