The thermal stability and specularity aspects of a CoNbZr-based bottom spin valve (SV) employing a nano-oxide layer (NOL) were investigated. The magnetoresistance (MR) ratio of the as-deposited CoNbZr-based bottom SV increased by 62% (from 6.3 to 10.2%) with incorporation of the NOL. The enhancement of the MR ratio was considered to be due to the specular effect (Deltarho increased from 0.722 to 1.363 muOmega cm) of the NOL. The MR ratio of a Ta-based bottom SV decreased by about 45% (from 6.9 to 3.8%) when the samples were annealed at 300 degreesC for 240 min. By contrast, the MR ratio of the CoNbZr-based bottom SV with NOL increased by 14% (from 10.2 to 11.7%). The root mean square roughness value of the CoNbZr layer (0.07 nm) was superior to that of the Ta layer (0.43 nm). Although Mn in IrMn diffused out to the surface through the active layers resulting in the formation of Mn oxide at the surface in the CoNbZr-based bottom SV, no trace of Mn was found in the active layers and no significant degradation occurred. (C) 2004 WILEY-VCH Verlag GmbH & Co. KGaA, Weinheim.