S&P ratings warning to top euro nations

Standard and Poor’s has warned Germany and the five other triple A members of the eurozone that they risk having their top-notch ratings downgraded as a result of deepening economic and political turmoil in the single currency bloc....Link

FRANKFURT (Standard & Poor's) Dec. 5, 2011--Standard & Poor's Ratings Services
today placed its long-term sovereign ratings on 15 members of the European
Economic and Monetary Union (EMU or eurozone) on CreditWatch with negative
implications.

We have also maintained the CreditWatch negative status of our long-term
rating on Cyprus and placed its short-term ratings on CreditWatch with
negative implications. The ratings on Greece have not been placed on
CreditWatch. The ratings on the eurozone sovereigns are listed below.

Today's CreditWatch placements are prompted by our belief that systemic
stresses in the eurozone have risen in recent weeks to the extent that they
now put downward pressure on the credit standing of the eurozone as a whole.

We believe that these systemic stresses stem from five interrelated factors:

(1) Tightening credit conditions across the eurozone;

(2) Markedly higher risk premiums on a growing number of eurozone sovereigns,
including some that are currently rated 'AAA';

(3) Continuing disagreements among European policy makers on how to tackle the
immediate market confidence crisis and, longer term, how to ensure greater
economic, financial, and fiscal convergence among eurozone members;

(4) High levels of government and household indebtedness across a large area
of the eurozone; and

(5) The rising risk of economic recession in the eurozone as a whole in 2012.
Currently, we expect output to decline next year in countries such as Spain,
Portugal and Greece, but we now assign a 40% probability of a fall in output
for the eurozone as a whole.

Our CreditWatch review of eurozone sovereign ratings will focus on three of
the five key factors that form the core of our sovereign ratings methodology:
the "political," "external," and "monetary" scores we assign to the
governments in the eurozone (see "Sovereign Government Rating Methodology And
Assumptions", published June 30, 2011). Our analysis of "political dynamics"
will focus on both country-specific and eurozone-wide issues that appear to us
to be limiting the effectiveness of efforts to resolve the market confidence
crisis. Our analysis of "external liquidity" will focus on the borrowing
requirements of both eurozone governments and banks. Our analysis of "monetary
flexibility" will focus on ECB policy settings to address the economic and
financial stresses the countries in the eurozone are increasingly facing.

We expect to conclude our review of eurozone sovereign ratings as soon as
possible following the EU summit scheduled for Dec. 8 and 9, 2011. Depending
on the score changes, if any, that our rating committees agree are appropriate
for each sovereign, we believe that ratings could be lowered by up to one
notch for Austria, Belgium, Finland, Germany, Netherlands, and Luxembourg, and
by up to two notches for the other governments.

Our ratings on Greece (Hellenic Republic; CC/Negative/C) are not affected by
today's actions, as a 'CC' rating under our rating definitions connotes our
belief that there is a relatively high near-term probability of default.

We are publishing separate media releases with the rationale for each rating
action on the 16 CreditWatch actions. We are also publishing the following
article: "Credit FAQ: Factors Behind Our Placement of Eurozone Governments on
CreditWatch".

Following today's CreditWatch listings, Standard & Poor's will issue separate
media releases concerning affected ratings on the funds, government-related
entities, financial institutions, insurance companies, public finance, and
structured finance sectors in due course.


RATINGS LIST To From

Long-term ratings on CreditWatch negative

Austria (Republic of)
Sovereign Credit Rating AAA/Watch Neg/A-1+ AAA/Stable/A-1+
Belgium (Kingdom of)
Sovereign Credit Rating AA/Watch Neg/A-1+ AA/Negative/A-1+

Finland (Republic of)
Sovereign Credit Rating AAA/Watch Neg/A-1+ AAA/Stable/A-1+

France (Republic of)
Sovereign Credit Rating AAA/Watch Neg/A-1+ AAA/Stable/A-1+

Germany (Federal Republic of)
Sovereign Credit Rating AAA/Watch Neg/A-1+ AAA/Stable/A-1+

Luxembourg (Grand Duchy of)
Sovereign Credit Rating AAA/Watch Neg/A-1+ AAA/Stable/A-1+

Netherlands (The) (State of)
Sovereign Credit Rating AAA/Watch Neg/A-1+ AAA/Stable/A-1+


Long- and short-term ratings on CreditWatch negative

Estonia (Republic of)
Sovereign Credit Rating AA-/Watch Neg/A-1+ AA-/Stable/A-1+

Ireland (Republic of)
Sovereign Credit Rating BBB+/Watch Neg/A-2 BBB+/Stable/A-2

Italy (Republic of)
Sovereign Credit Rating A/Watch Neg/A-1 A/Negative/A-1

Malta (Republic of)
Sovereign Credit Rating A/Watch Neg/A-1 A/Stable/A-1

Portugal (Republic of)
Sovereign Credit Rating BBB-/Watch Neg/A-3 BBB-/Negative/A-3

Slovak Republic
Sovereign Credit Rating A+/Watch Neg/A-1 A+/Positive/A-1

Slovenia (Republic of)
Sovereign Credit Rating AA-/Watch Neg/A-1+ AA-/Stable/A-1+

Spain (Kingdom of)
Sovereign Credit Rating AA-/Watch Neg/A-1+ AA-/Negative/A-1+


Short-term ratings on CreditWatch negative, long-term ratings still on
CreditWatch negative

Cyprus (Republic of)
Sovereign Credit Rating BBB/Watch Neg/A-3 BBB/Watch Neg/A-3

RELATED CRITERIA AND RESEARCH

Credit FAQ: Factors Behind Our Placement Of Eurozone Governments On CreditWatch, Dec. 5, 2011
European Economic Outlook: Back in Recession, Dec. 1, 2011
Why Trade Imbalances For Creditors As Well As Debtors In The Eurozone Are Weighing On Growth, Dec. 1, 2011
Standard & Poor's RPM Measures The Eurozone's Great Rebalancing Act, Nov. 21, 2011
Who Will Solve the Debt Crisis?, Nov. 10, 2011
Sovereign Government Rating Methodology And Assumptions, June 30, 2011
Use Of CreditWatch And Outlooks, Sept. 14, 2009

The ratings on France, Germany, The Netherlands, Italy, and Belgium are
unsolicited.

Standard & Poor's Ratings Services, Publication date: 05-Dec-2011 16:27:24 EST