S&P accidentally announces downgrade of French debt
- 10 November 2011
- From the section Business
Standard & Poor's accidentally released a message to some of its subscribers on Thursday saying that it had downgraded French debt from its top AAA rating.
S&P said it was investigating what had gone wrong and stressed that France still had an AAA rating.
The French market regulator AMF said it was also investigating how the error could have happened.
It came on the day that the difference between the yield of French and German bonds hit a record high.
At the end of Thursday's trading, the yield on a French OAT 10-year bond was 3.456% while the yield on a German 10-year bond was 1.776%.
Another ratings agency, Moody's, warned last month that France's "financial strength has weakened" and that it was "among the weakest of its AAA peers".
Moody's said it would decide within three months whether to change France's outlook from stable, indicating it was considering a downgrade.
"It's always the same fears, about France's triple A rating, the fragility of banks," said Cyril Regnat, a bond analyst at Natixis bank.
French banks have a particularly big exposure to Greek debt.
"As a result of a technical error, a message was automatically disseminated today to some subscribers of S&P's Global Credit Portal suggesting that France's credit rating had been changed," S&P said in a statement.
"This is not the case: the ratings on Republic of France remain 'AAA/A-1+' with a stable outlook and this incident is not related to any ratings surveillance activity. We are investigating the cause of the error."