The ratings on Wells Fargo&Co. reflect our stand-alone credit assessment, with no uplift for government support, and the bank's role as one of the systemically important banks in the U.S. financial system. Our Dec. 19, 2008, downgrade of Wels Fargo reflected our more negative view of industry risk in a cycle we believe will be more severe than a typical one. We expect that Wells Fargo will experience lower profitability on higher credit losses and related expenses in its residential mortgage, credit card, and residential-related commercial real estate portfolios, plus the merger expenses and integration risks associated with its recent acquisition of Wachovia Corp. Nevertheless, we expect Wells Fargo to fare better than peers. Wells Fargo reported a
