In our view, Dexia Credit Local's (DCL's) liquidity has improved, as its government-guaranteed issuance programs led to a reduction of its dependence on exceptional funding mechanisms and central bank loans. As such, we have positively reassessed DCL's stand-alone credit profile to 'bb' from 'b', and have removed the three notches of uplift we previously applied to reflect extraordinary short-term support from France and Belgium. We now consider Dexia Crediop SpA (Crediop) to be a core subsidiary of DCL. This assessment does not affect the rating because we cap the rating on Crediop at the level of the rating on Italy. We are affirming our 'BBB/A-2' issuer credit ratings on DCL and raising the issue rating on DCL's nondeferrable subordinated debt
