We believe that Unione di Banche Italiane Scpa's (UBI Banca) capacity to absorb credit losses is under negative pressure from very low interest rates in a period when we believe credit risk costs will remain high. We are revising our outlook on UBI Banca to negative from stable. We are affirming our 'A/A-1' counterparty credit ratings on UBI Banca, reflecting our view that, for the rating level, the bank's asset quality has deteriorated less than average. The negative outlook reflects our view of the bank's reduced capacity to absorb higher-than-expected credit losses in the event of a faltering of the fragile economic recovery. On April 23, 2010, Standard&Poor's Ratings Services revised its outlook on Italy-based banking group Unione
