S&P: Germany ‘AAA/A-1+’ Ratings Affirmed; Outlook Stable

OVERVIEW

• In our view, Germany has a highly diversified and competitive economy with a demonstrated ability to absorb large economic and financial shocks.
• Germany also benefits from low interest rates, which help lower sovereign borrowing costs in the medium term.
• We are affirming our unsolicited ‘AAA’ long-term and ‘A-1+’ short-term sovereign credit ratings on Germany.
• The stable outlook reflects our view that Germany’s public finances and strong external balance sheet will continue to withstand potential financial and economic shocks.

S&P: United Kingdom Affirmed At ‘AAA/A-1+’; Outlook Stable

OVERVIEW

• The United Kingdom has high monetary, labor, and product-market flexibility, and a wealthy and diversified economy.
• Output and employment growth have exceeded our previous projections, but the U.K.’s fiscal position has underperformed our expectations and has yet to reflect a strengthening economy.
• We are affirming our ‘AAA/A-1+’ long- and short-term sovereign credit ratings on the U.K.
• The stable outlook reflects our assumptions that the U.K. fiscal position will gradually strengthen as real-wage and productivity growth improve toward pre-crisis averages, and that the government that emerges from the May 2015 general election will remain committed to fiscal consolidation.
  Our outlook also assumes the U.K.’s ongoing EU membership.

Moody’s Changes Outlook On European Union’s Aaa Rating To Stable From Negative; Rating Affirmed

Frankfurt am Main, March 14, 2014

Moody’s Investors Service has today changed the outlook to stable from negative on the European Union’s (EU) Aaa rating. Concurrently, Moody’s has affirmed its Aaa/(P)Prime-1 ratings.

The key drivers of today’s outlook change are as follows:

1. The improvement in the creditworthiness of the EU’s largest shareholders, which it depends on for additional support in high stress scenarios.
2. Diminishing risks emanating from the euro area debt crisis, which alleviates pressure on asset quality.

The key drivers for today’s affirmation of the EU’s Aaa/(P)P-1 ratings are:

1. The joint and several liability of member states with regard to their obligations to the EU.
2. The EU’s multi-layer debt-service protection.
3. The EU’s conservative budget management.

Moody’s Changes Outlook On The Netherlands’ Aaa Government Bond Rating To Stable From Negative; Rating Affirmed

London, 07 March 2014

Moody’s Investors Service has today changed the outlook on the Netherlands’ Aaa government bond ratings to stable from negative. Concurrently, Moody’s has affirmed the Netherlands Aaa and Prime-1 debt ratings.

The key drivers for today’s outlook change are:

1. Declining risks that the Netherlands’ government balance sheet will be affected by further collective support to other euro area countries, in particular to Italy (Baa2 stable) or Spain (Baa2 positive), along with reduced contagion risks within the wider euro area.
2. Signs that the Netherlands’ own domestic vulnerabilities — specifically the weak growth outlook, high household indebtedness, and falling house prices — have peaked and are likely to evolve in a positive direction.
3. The stabilisation of the Netherlands’ fiscal strength, as reflected in a debt-to-GDP ratio that Moody’s expects will peak in 2015.

Moody’s Changes Outlook On Germany’s Aaa Government Bond Rating To Stable From Negative; Rating Affirmed

Frankfurt am Main, February 28, 2014

Moody’s Investors Service, (“Moody’s”) has today changed the outlook on Germany’s Aaa government bond rating to stable from negative. Concurrently, Moody’s has affirmed Germany’s Aaa ratings.

The key drivers for today’s outlook change are:

1. Diminished risks that Germany’s government balance sheet will be affected by further collective support to other euro area countries, in particular to Italy (Baa2 stable) or Spain (Baa2 positive), along with reduced contagion risks within the wider euro area.
2. Progress with respect to fiscal consolidation as reflected in nearly balanced budgets in 2012 and 2013 and a declining debt-to-GDP ratio.
3. Diminished risks that Germany’s government balance sheet will be affected by a further crystallization of contingent liabilities from the German banking system.

Moody’s has affirmed Germany’s Aaa rating due to the country’s advanced and diversified economy, very high debt affordability and a history of stability-oriented macroeconomic policies.