The risks stemming from Andorra's financial sector have increased beyond our expectations following the U.S. Department of the Treasury's Financial Crimes Enforcement Network's (FinCEN) announcement on March 10, 2015, starting a rule-making proposal concerning Banca Privada d'Andorra (BPA), owing to the bank's alleged money laundering activities. BPA could consequently lose its ability to operate with U.S. counterparties after the proposal's 60-day comment period expires. In our assessment, a rapid increase in nonresident assets under management by Andorran financial institutions since 2011 and a far-reaching expansion of the banks´ international footprint have significantly increased reputational and other financial risks, straining the response capacity of Andorran regulatory bodies. We are therefore lowering our long-term rating on Andorra to 'BBB' from 'BBB+' and
