Moody's downgrades Dexia

Moody's Investors Service said it downgraded the long-term senior debt and deposit ratings of Dexia Credit Local to Baa2 from Baa1, with a negative outlook.

The Prime-2 short-term rating was affirmed.

Moody's said the downgrade directly follows its downgrade of Dexia's standalone bank financial strength rating to E, mapping to Caa1 on the long-term scale, from E+/B2.

The downgrade of the standalone bank financial strength rating was triggered by Moody's view that Dexia, under its post-restructuring form, will likely continue to operate under significant stress, the agency said.

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