DTCC reacts to S&P downgrade of clearing subsidiaries

New York, NY, August 8, 2011 - The Depository Trust & Clearing Corporation (DTCC) today issued the following statement in response to the decision by Standard & Poor’s (S&P) to downgrade S&P’s AAA rating on three of DTCC’s clearing subsidiaries, National Securities Clearing Corporation (NSCC), The Depository Trust Company (DTC) and Fixed Income Clearing Corporation (FICC):

DTCC remains confident in its effectiveness as the leading infrastructure and central counterparty for the cash equities and fixed income markets. The fundamental strengths of our company are the same today as they were prior to this recent revision in the S&P AAA ratings we’ve consistently earned for these three clearing subsidiaries.

This adjustment to AA+ is not in any way a reflection on DTCC's clearing and overall operations or a result of any company-specific event. This action by S&P followed the lowering of its long-term sovereign credit rating on the U.S., and is simply due to that change. In its announcement, S&P reaffirmed the short-term counterparty credit rating for DTC, NSCC and FICC at A-1+.

According to S&P, “We have not changed our view of the fundamental soundness of [DTCC’s] depository or clearing operations. Rather, the downgrades incorporate potential incremental shifts in the macroeconomic environment and the long-term stability of the U.S. capital markets as a consequence of the decline in the creditworthiness of the federal government.” Our organization continues to be as financially strong as before this announcement. We continue to apply our standard rigorous risk management practices and world class corporate governance in order to preserve the viability and resilience of our company, and the safety of our customers and the market.

NSCC and DTC had received S&P’s highest credit rating for nine consecutive years and FICC had also received S&P’s highest rating for six consecutive years. We do not anticipate any changes in our operations as a result of this revision of our credit rating.

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