October 18, 2011

Tougher Economic Prospects And Rising Sovereign Risk Prompt Negative Rating Actions On Italian Banks
Primary Credit Analysts: Renato Panichi, Milan (39) 02 72111-215; renato_panichi@standardandpoors.com Taos Fudji, Milan (39) 02-72111-276; taos_fudji@standardandpoors.com Secondary Contacts: Mirko Sanna, Milan (39) 02-72111-275; mirko_sanna@standardandpoors.com Angelo Cortese, Milan (39) 02-72111-205; angelo_cortese@standardandpoors.com Regina Argenio, Milan +390272111208; regina_argenio@standardandpoors.com Francesca Sacchi, Milan (39) 02 72111-272; francesca_sacchi@standardandpoors.com

Renewed market tensions in the eurozone's periphery, particularly in Italy, and dimming growth prospects have in our view led to further deterioration in the operating environment for Italy's banks. We think funding costs for the banks will increase noticeably because of higher yields on Italian sovereign debt. Furthermore, higher funding costs for both the banking and corporate sectors are likely to result in tighter credit conditions and weaker economic activity in the short-to-medium term. We are revising downward our Banking Industry Country Risk Assessment (BICRA) on the Republic of Italy (unsolicited ratings, A/Negative/A-1) to Group 3 from Group 2, and lowering the economic risk score, a subcomponent of the BICRA, to 3 from 2. We are taking negative rating actions on 24 banks and financial institutions and affirming our ratings on 19 banks.

MILAN (Standard & Poor's) Oct. 18, 2011--Standard & Poor's Ratings Services said today that it revised the ratings on multiple Italian financial institutions (see list below). Today's rating actions result from our review of the implications of a tougher-than-previously-anticipated macroeconomic and financial environment for the Italian banks.

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Tougher Economic Prospects And Rising Sovereign Risk Prompt Negative Rating Actions On Italian Banks

In our opinion, renewed market tensions in the eurozone's periphery, particularly in Italy, and dimming growth prospects have led to further deterioration in the operating environment for Italian banks. We also think the cost of funding for Italian banks will increase noticeably because of higher yields on Italian sovereign debt. Furthermore, we expect the higher funding costs for both banks and corporates to result in tighter credit conditions and weaker economic activity in the short-to-medium term. We do not believe that this difficult operating climate is transitory or that it will be easily reversed. In our view, funding costs for Italian banks and corporates will remain noticeably higher than those in other eurozone countries unless the Italian government implements workable growth-enhancing measures and achieves a faster reduction in the public sector debt burden. Consequently, we envisage a situation where the Italian banks may well be operating with a competitive disadvantage versus their peers in other eurozone countries. At the same time, we think all banking systems across the eurozone, including Italy, may raise their commitment to reinforcing banks' capitalization. In our view, these developments are significantly different from the expectations we had previously factored into our ratings on Italian banks (see "Italian Banks Are Facing A Tricky Recovery," published April 14, 2011 on RatingsDirect on the Global Credit Portal). In our view, Italian banks' profitability could decline in the next couple of years, given the likely sizable increase in their funding costs, volatility in the capital markets, and reduced prospects for credit growth. We are also of the view that Italy's slowing economic growth in 2012 could impede improvements in Italian banks' asset quality and further strain their creditworthiness. We have also revised our Banking Industry Country Risk Assessment (BICRA) on the Republic of Italy's banking system to Group 3 from Group 2 (see "Italy Banking Industry Country Risk Assessment Revised Down To 3 From 2 On Heightened Economic Risk," published today). Our BICRA rankings integrate our view of the strengths and weaknesses of a country's banking system compared with those of other countries. The BICRA change reflects our view of the increased economic and industry risks that Italy is facing and their impact on its banking system. The change incorporates the revision of our economic risk score, a subcomponent of the BICRA, for Italy to '3' from '2'. Today's rating actions follow our previous downgrades of other Italian banks in September 2011, after we lowered our sovereign ratings on Italy (see "Italy Unsolicited Ratings Lowered To 'A/A-1' On Weaker Growth Prospects, Uncertain Policy Environment; Outlook Negative", published Sept. 19, 2011, and "Seven Downgrades And Eight Outlook Revisions To Negative On Italian Banks After Sovereign Downgrade," published Sept. 21, 2011). As of today, our ratings on 22 out of 43 Italian financial institutions carry negative outlooks. These reflect the negative outlook on the Republic of Italy and/or the potential for downside risk in our current expectations, either

Standard & Poors | RatingsDirect on the Global Credit Portal | October 18, 2011

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Tougher Economic Prospects And Rising Sovereign Risk Prompt Negative Rating Actions On Italian Banks

because the macroeconomic environment could deteriorate or because the effect on an individual bank's financial profile under our baseline scenario could be greater than expected.

RELATED CRITERIA AND RESEARCH Nonsovereign Ratings That Exceed EMU Sovereign Ratings: Methodology And Assumptions, June 14, 2011 Stand-Alone Credit Profiles: One Component Of A Rating, Oct. 1, 2010 Use Of CreditWatch And Outlooks, Sept. 14, 2009 Group Methodology, April 22, 2009 Principles Of Credit Ratings, Feb. 16, 2011 Rating Government-Related Entities: Methodology And Assumptions, Dec. 9, 2010 Bank Rating Analysis Methodology Profile, March 18, 2004 Bank Capital Methodology And Assumptions, Dec. 6, 2010 Methodology: Banking Industry Country Risk Assessments, June 6, 2006 Italian Banks' Recovery Shifts Into Reverse As Italy's Sovereign Risk Escalates, Oct. 18, 2011 Italy Banking Industry Country Risk Assessment Revised Down To 3 From 2 On Heightened Economic Risk, Oct. 18, 2011 Italian Banks Are Facing A Tricky Recovery, April 14, 2011

RATINGS LIST To From

Downgraded Banca Monte dei Paschi di Siena SpA Counterparty Credit Rating BBB+/Stable/A-2 A-/Stable/A-2 Banco Popolare Societa Cooperativa SCRL Credito Bergamasco Banca Aletti & C. SpA BBB/Stable/A-2 A-/Negative/A-2 Unione di Banche Italiane Scpa A-/Stable/A-2 A/Negative/A-1 Banca Popolare dell'Emilia Romagna S.C. BBB+/Stable/A-2 A-/Stable/A-2 Banca Popolare di Milano SCRL Banca Akros SpA BBB+/Negative/A-2 A-/Stable/A-2 Banca Carige SpA BBB+/Negative/A-2 A-/Negative/A-2 Banca Popolare di Vicenza ScpA BBB/Stable/A-2 BBB+/Stable/A-2 Credito Emiliano SpA BBB+/Stable/A-2 A-/Stable/A-2 Veneto Banca SCPA BBB/Negative/A-2 BBB+/Negative/A-2 Cassa di Risparmio della Provincia di Teramo SpA BB+/Negative/B BBB/Negative/A-2 Cassa di Risparmio di Cento SpA

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Tougher Economic Prospects And Rising Sovereign Risk Prompt Negative Rating Actions On Italian Banks

BB+/Stable/B BBB-/Stable/A-3 Banca Popolare dell'Alto Adige BBB+/Stable/A-2 A-/Stable/A-2 Banca di Bologna BB+/Stable/B BBB-/Stable/A-3 Iccrea Holding SpA Iccrea Banca SpA Iccrea BancaImpresa SpA BBB+/Stable/A-2 A-/Negative/A-2 Agos-Ducato SpA A-/Negative/A-2 A/Negative/A-1 Farmafactoring SpA BBB-/Stable/A-3 BBB/Stable/A-2 Banca Mediocredito del Friuli-Venezia Giulia SpA BBB+/Stable/A-2 A-/Negative/A-2 BancaSai SpA BB/Negative/B BB+/Negative/B Outlook Revised To From Banca di Credito Cooperativo San Marzano di San Giuseppe S.c.r.l. BBB-/Negative/A-3 BBB-/Stable/A-3 CreditWatch Status Revised To Negative To Dexia Crediop SpA BBB+/Watch Neg/A-2 Affirmed To Intesa Sanpaolo SpA Banca IMI SpA Banca Infrastrutture Innovazione e Sviluppo SpA (BIIS) Cassa di Risparmio in Bologna SpA UniCredit SpA UniCredit Bank AG UniCredit Bank Austria AG UniCredit Leasing SpA A/Negative/A-1 Banca Nazionale del Lavoro SpA A+/Negative/A-1 Cassa di Risparmio di Parma e Piacenza SpA A+/Negative/A-1 Mediobanca SpA A/Negative/A-1 Banca Fideuram A/Negative/A-1 Banca di Credito Cooperativo di Conversano S.c.r.l BBB-/Stable/A-3 FGA Capital SpA BBB/Negative/A-3 Findomestic Banca SpA A/Negative/A-1 Istituto per il Credito Sportivo A/Negative/A-1 Istituto Centrale delle Banche Popolari Italiane SpA CartaSi SpA BBB/Stable/A-2 Eurofidi Scpa BBB/Negative/A-2
Additional Contact:

From BBB+/Watch Dev/A-2

Standard & Poors | RatingsDirect on the Global Credit Portal | October 18, 2011

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Tougher Economic Prospects And Rising Sovereign Risk Prompt Negative Rating Actions On Italian Banks
Financial Institutions Ratings Europe; FIG_Europe@standardandpoors.com

Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column. Alternatively, call one of the following Standard & Poor's numbers: Client Support Europe (44) 20-7176-7176; London Press Office (44) 20-7176-3605; Paris (33) 1-4420-6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-440-5914; or Moscow 7 (495) 783-4009.

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Standard & Poors | RatingsDirect on the Global Credit Portal | October 18, 2011

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