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May 23 (Reuters) -
* Moody's downgrades China's rating to A1 from AA3 and changes outlook to stable from negative
* Moody's on China - rating reflects expectation that China's financial strength will erode somewhat over the coming years
* Moody's on China- stable outlook reflects assessment that, at the A1 rating level, risks are balanced
* Moody's on China - GDP will remain very large; growth will remain high compared to other sovereigns, potential growth is likely to fall in coming years
* Moody's on China - Moody's expects that economy-wide leverage will increase further over the coming years.
* Moody's on China - expect indirect and contingent liabilities to increase
* Moody's on China - expect China's growth potential to decline to close to 5% over the next five years
* Moody's on China - expect the government's direct debt burden to rise gradually towards 40% of GDP by 2018 and closer to 45% by the end of the decade
* Moody's on China - stable outlook denotes broadly balanced upside and downside risks.
* Moody's - China's local currency and foreign currency senior unsecured debt ratings are downgraded to A1 from AA3.
* Moody's - China's local currency bond and deposit ceilings remain at AA3. Source text: bit.ly/2qhENmq