The number of sovereign rating actions that Standard & Poor’s RatingsServices has taken over the past several months has led to heightenedinterest in our approach to issuing ratings that are above the sovereign’s for government-related entities (GREs), banks, insurers,

corporations, state, regional, or local governments, and securitizations.

Investors have asked for clarification on our methodologies and examples of

how we put them into practice. So it seems appropriate to summarize the

criteria we’ve published on the topic and to answer the questions we receive

most frequently from market participants. We note that for entities

domiciled in countries which are members of the European Monetary Union

(EMU), readers should refer to the separate criteria article: “Nonsovereign

Ratings That Exceed EMU Sovereign Ratings,” published June 14, 2011,

on RatingsDirect, on the Global Credit Portal.

Standard & Poor’s CreditWeek | August 17, 2011 22

Understanding Ratings Above The Sovereign

Credit FAQ