On Dec. 13, 2012, Standard&Poor's revised its outlook on the United Kingdom 'AAA' long-term sovereign credit rating to negative from stable. Nationwide Building Society's risk-adjusted capital (RAC) ratio, according to our measures, has declined, primarily due to a net actuarial loss in the employee pension scheme. As a result of both factors, we are revising our outlook on the long-term rating on Nationwide to negative from stable. We are affirming our 'A+/A-1' ratings on Nationwide. The negative outlook on Nationwide reflects both the negative trend in the RAC ratio and our view that if we lowered the long-term rating on the U.K. to 'AA+', we would henceforth only factor one notch for potential extraordinary government support into the
