Cyprus News Agency: News in English, 11-11-04

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From: The Cyprus News Agency at <http://www.cyna.org.cy>

CONTENTS

[01] DOWNER - BRIEFING

[02] MOODY`S - DOWNGRADING

[01] DOWNER - BRIEFING

During the discussion, which lasted for more than one hour, Security Council members expressed their support to the efforts of the UN Secretary General and his representative towards a Cyprus solution.

Chairman of the Security Council Jose Filipe Moraes Cabral stated to the Press after the unofficial meeting that Downer had briefed Security Council members in detail over the meeting in Greentree and added that those attending agreed that additional efforts had to be made by the two sides, who needed to display the necessary political will to conclude negotiations in a fruitful way.

Commenting on little progress made in four of the core issues of the negotiation process, Cabral said that things may not proceed as quickly as some wish, but added that this is normal in a process like this.

[02] MOODY`S - DOWNGRADING

The rating agency has also downgraded Cyprus`s short-term rating to Prime-3 from Prime-2 and placed it on review for further possible downgrade.

According to Moody`s, the key drivers are the high likelihood that the Cypriot banking system will require state support in 2012 as a result of the large expected write-downs on its exposures to Greek government bonds, adding that ``this state support will have a significant negative impact on the government`s debt metrics.``

It also adds that the full extent of required state support for the Cypriot banking system could increase further, given the substantial downside economic and financial risks in Greece.

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