UPDATE 1-Moody’s puts Spain on review for possible downgrade

* Spain holds Moody’s debt rating one below top

* Moody’s downngraded Spain from top notch Sep. 30

* Euro extends losses on news

(Adds comment, background)

MADRID, Dec 15 (BestGrowthStock) – Ratings agency Moody’s said on
Wednesday it has put Spain on review for a possible downgrade
because of its high funding needs, doubts over its banking
sector and concerns surrounding regional finances.

The euro extended the day’s losses on the
announcement. [ID:nTKW007201]

Spain has been under intense scrutiny from international
markets since Ireland was forced to take a 85-billion euro aid
package in November on worries over similarities between their
property and banking sectors.

The government has firmly denied it would also need to
apply to the European Financial Stability Facility (EFSF) and
rejected any comparison between its own economic position and
Ireland’s.

“Moody’s does not believe that Spain’s solvency is under
threat and in its base case assumptions does not expect the
Spanish government to have to ask for EFSF liquidity support,”
Moody’s lead analyst on Spain Kathrin Muehlbronner said in a
statement.

“However, Spain’s substantial funding requirements, not
only for the sovereign but also for the regional governments
and the banks, make the country susceptible to further
episodes of funding stress.”

(Reporting by Paul Day; editing by Kazunori Takada)

UPDATE 1-Moody’s puts Spain on review for possible downgrade