S&P Cuts Spain’s Credit Rating
Standard & Poor’s has cut Spain’s credit rating for the third time in three years as an economic slowdown and the euro zone’s sovereign debt crisis continue to threaten the nation’s financial profile.
Late Thursday, S&P reduced Spain’s ranking by one level to AA-, the ratings agency’s fourth-highest investment grade, with the outlook remaining negative. Fitch Ratings downgraded Spain to the same level on October 7, when the agency also cut its rating on Italy.
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“Despite signs of resilience in economic performance during 2011, we see heightened risks to Spain’s growth prospects,” S&P said in a statement released yesterday. “The financial profile of the Spanish banking system will, in our opinion, weaken further, with the stock of problematic assets rising further.”