LONDON (Standard&Poor's) April 17, 2008--Standard&Poor's Ratings Services today said it had lowered the long-term foreign currency rating on the Republic of Iceland to 'A' from 'A+' and its long-term local currency rating to 'AA-' from 'AA'. The 'A-1' short-term foreign currency and 'A-1+' short-term local currency ratings were both affirmed. The long-term ratings on Iceland were removed from CreditWatch negative, where they were placed on April 1, 2008, and are now on negative outlook. "The downgrade of the sovereign reflects increasing economic policy challenges, largely due to pressure on Iceland's external funding for the nation's commercial banks," Standard&Poor's credit analyst Eileen Zhang said. "Iceland's banks rely on wholesale funding, particularly from overseas, and higher
