Credit Rating Agencies the heart of global financial systems Part.III

In the United States is the SEC that accredits the rating agencies can note issuers, a special status, the NRSRO. It is now held by the five main rating agencies that represent 98% of the U.S. market. The two challengers were able to obtain this status, a prelude to any attempt to internationalize, in 2003 for the Canadian DBRS (Dominion Bond Rating Services) and 2005 to the American AM Best, which specializes in rating companies insurance.


This demand for self-regulation has led rating agencies to overhaul their practices in methodology and ethics. Indeed, quantitative approaches too opaque and often resulted in "very good" ratings of financial players to hidden risks, or having issued bonds such as "structured finance" in spite of the risks associated with the nature of these products.

So in March 2007, it revised its rating methodology for banks by reducing the inclusion of state support or supervisory authorities in order to avoid masking the credit risk inherent in each bank. In June of that year, S & P revised its criteria for assessing securitization vehicles financing leveraged to take into account the loan contracts with very lightweight protection clauses.
On June 25, 2007, the French Banking Commission released the list of ECAI distinguishes seven actors: the Bank of France, Coface, DBRS, Fitch Ratings, Moody's, S & P and Japan Credit Agency. This status enables credit institutions to use the notations of ECAIs mentioned above for France to determine regulatory capital requirements arising from Basel 2 regulations.

The market for credit ratings is changing in light of internal innovations, new regulations and fears of investors. This cache of new players those focus on different goals in the field.