National Australia Bank (ASX:NAB) has received an AAA rating, with a stable outlook, from Fitch Ratings for its $1.75 billion mortgage-covered bond, according to a Tuesday release.

The fixed-rate bond's rating considers the bank's AA- issuer default rating, the three-notch rating uplift extended to the program, and the over-collateralization protection through its asset percentage of 95%, Fitch said.

The stable outlook stems from a four-notch buffer against an issuer default rating downgrade.

A downgrade of the bank's rating by five or more notches to BBB or below or an asset percentage below 95% could trigger a downgrade of the covered bond, Fitch said.