Following a review under Standard&Poor's revised bank criteria (published on Nov. 9, 2011), we have lowered our long-term rating on Dexia Crédit Local (DCL) to 'BBB+' from 'A-'. The long- and short-term 'A-2' ratings remain on CreditWatch with negative implications. Our ratings on DCL reflect the 'a-' anchor, moderate business position, adequate capital and earnings, moderate risk position, below-average funding, and weak liquidity, as our criteria define these terms. The long-term rating incorporates six notches of uplift reflecting our view of DCL's high systemic importance and belief that governments are willing to provide additional short-term liquidity support. The negative CreditWatch implications reflect our assessment of the uncertainties regarding DCL's future business position and the negative pressure arising from
