STOCKHOLM, May 6 (Reuters) - Sweden's indebted SBB reported a first-quarter loss of 1.3 billion Swedish crowns ($120 million) on Monday, but predicted financing conditions would improve as it made further write downs on the value of its properties.

The troubles at one of Sweden's largest commercial landlords are unfolding as the country attempts to ride out a persistent property crisis, triggered by high debts, rising interest rates and a wilting economy.

Sweden's central bank cautioned last year that the problems among heavily indebted commercial property companies could spill over and hit the economy more widely.

SBB's first-quarter loss before tax compared with a revised loss of 4.12 billion crowns a year earlier, while it wrote down the values of its properties by a further 1.98 billion crowns.

After racking up debts buying social properties such as schools and hospitals, SBB has seen its credit rating cut to junk status over the past year.

SBB CEO Leiv Synnes expressed hope that refinancing conditions were gradually improving for the indebted group.

"My assessment is that credit margins will likely continue decreasing and that SBB's part-owned companies can benefit from this more advantageous financing," Synnes said as he presented the quarterly results, which had been delayed from April.

"What Synnes writes shows that he expects SBB's associated companies to borrow more with lower credit margins, while SBB will continue to reduce its debt burden," said Carlsquare analyst Bertil Nilsson.

Carlsquare's Nilsson said, however, that SBB's deteriorating interest coverage ratio, which shows the ability of a firm to pay the interest on outstanding debt, was a "negative."

Based on Nilsson's calculations, after deducting distribution to hybrid bondholders, interest coverage had dropped to 119% from 154%.

Shares in SBB, which said in September it would decentralize its business into education, residential and community, were down around 1% in early trading on Monday. The stock has lost more than 90% of its value since peaking in 2021. ($1 = 10.8207 Swedish crowns) (Reporting by Greta Rosen Fondahn and Marie Mannes; Editing by Terje Solsvik, Mark Potter and Alexander Smith)