“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”.
“Risks to the creditworthiness of the EU and to its rating include a deterioration in the creditworthiness of the EU member states, as reflected in downgrades of Moody's ratings for these states. The EU's rating is particularly sensitive to changes in the ratings of the four countries rated Aaa or Aa1 that make large contributions to the EU budget (i.e., Germany, France, the UK and the Netherlands). A weakening of the commitment of the member states to the EU and changes to the EU's fiscal framework that would lead to less conservative budget management would also be credit negative”.
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