More debt downgrade warnings are looming on the horizon.  This time for Puerto Rico, a nation which many consider the unspoken fifty-first state in America.  Moody’s Investors Service has now placed certain ratings of the Puerto Rican subsidiaries of Banco Santander SA (NYSE: STD), Banco Bilbao Vizcaya Argentaria SA (NYSE: BBVA) and also of Banco Popular Inc. (NASDAQ: BPOP) on a rating review for a possible credit rating downgrade.

Moody’s review stated that Puerto Rico’s ongoing recession continues to have an adverse impact on its financial institutions.  It also noted weak prospects for a sustainable recovery in the coming years.

Shares of Banco Popular are down 0.5% at $1.80 this morning against a 52-week trading range of $1.08 to $3.30.  The Spanish banks are up on news that peripheral debt sales in Europe might not be as bad as the indications were signaling in Spain earlier this week.  Banco Santander, S.A. (NYSE: STD) is up 4.5% at $6.80 and Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBVA) is indicated up 6% at $7.20.

JON C. OGG