Bangkok--11 Jun--Standard & Poor's Europe credit quality remains under pressure from the slowing Eurozone and global economies, heightened inflation, and tight liquidity conditions, according to an article published by Standard & Poor's. The article, which is titled "Europe Corporate Bond Market Snapshots (Premium)," says that the increased leverage in many entities that was fueled by the combination of stiff competition and abundant liquidity and the aggressive leveraged buyout strategies of prior years now put weaker credits particularly vulnerable in a protracted credit market squeeze. "Even in the current environment, standards for leveraged loans continue to deteriorate, with cash coverage ratios falling further in 2008," noted Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. The preceding boom enabled many entities to adopt sounder financial strategies and strengthen their financial positions in a way that helped mitigate financial adversity for stronger credits and delay corporate casualties for vulnerable ones at this turn in the credit cycle. Indeed, corporate defaults in Europe have been nonexistent in the year-to-date in spite of the marked increase in downgrades. "We anticipate that downgrades will continue to accelerate through the rest of the year and into 2009, and will eventually include a number of defaults," Ms. Vazza added. This article is part of our premium Global Fixed Income Research content, which is available to premium subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com. Ratings information can also be found on Standard & Poor's public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Find a Rating, then Credit Ratings Search. Members of the media may request a copy of this report by contacting the media representative provided. Media Contact: Mimi Barker, New York (1) 212-438-5054, [email protected] Analyst Contact: Diane Vazza, New York (1) 212-438-2760