In the secondary market, E.ON bonds developed differently in the first half and the second half of 2007. In the first half of the year, the risk premiums (spreads) of E.ON bonds nar- rowed (for our euro-denominated bonds) or remained largely unchanged (for our bonds denominated in British pounds sterling). In the second half of the year, the spreads widened significantly driven by the mortgage-lending crisis in the United States and a negative overall mood in the market. Credit default swaps, indicators of the current price of hedg- ing E.ON's credit risk, followed this pattern. E.ON bonds are included in all relevant bond indices, in par- ticular the iBoxx Utilities A, iBoxx Utilities, and iBoxx Non- Financials A. Selection for inclusion in indices is subject to criteria, such as a bond's rating, maturity, and minimum trading volume. E.ON bonds were issued under our existing Debt Issuance Program ("DIP"). In December 2007, the DIP's volume was raised from 10 billion to 30 billion. Translated into our reporting currency, we had 13 billion in bonds outstanding under our DIP at year end 2007. In addition to our DIP, we have a 10 billion European Com- mercial Paper under which we can issue short-term commer- cial paper. We had utilized 1.8 billion of this program as of year end 2007. E.ON successfully increased its existing syndicated credit facility from 10 billion to 15 billion. The facility consists of two tranches. The increase was achieved by raising the short-term tranche from 5 billion to 10 billion. The short- term tranche was also extended for an additional 364 days to November 27, 2008. The long-term tranche has a volume of 5 billion and matures on December 2, 2011. As of year end 2007, our credit facility had not been utilized. Notes 26 and 27 to the Consolidated Financial Statements contain detailed information about E.ON's liabilities, contingencies, and commitments. Following the announcement of our new investment plan for the period 2007­2010, on May 31, 2007, Moody's con- firmed its long-term rating for E.ON at A2 with a stable out- look. Previously, Moody's had reduced its long-term rating for E.ON from Aa3 to A2 following E.ON's announcement that it had signed an agreement with Enel and Acciona to acquire certain assets. Moody's short-term rating for E.ON remained unchanged at P-1. On June 12, 2007, Standard & Poor's lowered its long-term rating for E.ON from AA- to A (stable outlook) and its short- term rating from A-1+ to A-1 following the announcement of E.ON's revised strategy on May 31, 2007. Moody's A2 rating and Standard & Poor's A rating take into consideration the increase in our planned investments and the resulting increase in our debt. Both agencies anticipate that the key figures relevant for E.ON's rating will remain compatible with the A2 and A ratings despite our increased investments and debt. 53To Our Shareholders Supervisory Board Year in Review Combined Group Management Report Additional Information Market Units Corporate Governance Consolidated Financial Statements Tables and Explanations Outlook Stable Stable Moody's Standard & Poor's Long term A2 A Short term P-1 A-1 E.ON AG Ratings