Research Update: Spanish Power Grid Operator Red Electrica Ratings Lowered To 'A+/A-1' After Sovereign Rating Action; Outlook Negative Feb 12

Standard & Poors, February 2012

Abstract
On Jan. 13, 2012, we lowered our long-term sovereign rating on the Kingdom of Spain to 'A' from 'AA-', assigned a negative outlook, and removed the rating from CreditWatch negative. In our view, Spanish power grid operator Red El-ctrica Corporaci-n's credit risk profile is now less robust, owing to the group's exposure to increased sovereign and economic risks in Spain. We are lowering our long- and short-term ratings on Red El-ctrica Corporaci-n S.A. and its subsidiary Red El-ctrica de Espa-a S.A.U. (together, REE) to 'A+/A-1' from 'AA-/A-1+' and removing them from CreditWatch negative. The negative outlook on REE reflects that on Spain. Under our criteria, the long-term rating on Spain constrains the ratings on REE, based on our view that...

Companies mentioned in this report are: Red Electrica Corporacion S.A.,Red Electrica de Espana Finance B.V.,Red Electrica de Espana S.A.U.,Red Electrica Financiaciones, SAU
Action: Downgraded
Action: Outlook: Negative
Action: Removed From CreditWatch

Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.

Product Type: Research Update
Research updates complement media releases. They offer more depth and detail than summary analyses by incorporating all information published in the media release. They are more up to date than summaries in that they are published simultaneously with media releases.

Red Electrica Corporacion S.A.,Red Electrica de Espana Finance B.V.,Red Electrica de Espana S.A.U.,Red Electrica Financiaciones, SAU

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