EU Downgrades, EBA Stress Tests, Dutch Antitrust: Compliance

Standard & Poor’s, rebuked by Warren Buffett in August after downgrading the U.S. over government gridlock, is again injecting itself into the political process, just as European leaders are poised to meet for a summit aimed at ending the region’s sovereign-debt crisis. The ratings firm put Germany, France and 13 other euro-area nations on review for a downgrade, saying “continuing disagreements among European policy makers on how to tackle” the region’s debt crisis risk damaging their financial stability. The move came four months after S&P cut the U.S. to AA+, saying “extremely difficult” political discussions over how to reduce America’s more than $1 trillion budget deficit tainted the credit quality of the world’s largest economy. Bondholders questioned the timing of S&P’s move, which occurred Dec. 5, with European Union leaders planning to meet Dec. 8-9 in Brussels to end a crisis that led to bailouts of Greece, Ireland and Portugal, and now threatens to engulf Italy. Canada Goose Jakker German Chancellor Angela Merkel and French President Nicolas Sarkozy had presented a plan earlier in the day to rewrite the EU’s governing treaty to allow tighter economic cooperation. Grades may be lowered by one level for Austria, Belgium, Finland, Germany, Netherlands and Luxembourg, and as many as two steps for the other governments if the summit results don’t satisfy S&P’s criteria, the firm said. More than $8.1 trillion of government debt would be affected if S&P does downgrade all the nations, according to data compiled by Bloomberg. Germany and France are rated AAA. Moritz Kraemer, S&P’s head of European sovereign ratings, said yesterday in a conference call with reporters that the Euro-zone crisis has reached a level of “systemic stresses,” and has become “a crisis of euro zone governance.” Kraemer denied that the company was trying to influence politics.