recent financial crisis has highlighted the three main problems credit rating agencies lack of competition to the importance of agencies in capital markets
The recent financial crisis has highlighted the three main problems involving credit rating agencies: lack of competition, due to the scarce importance of rating agencies in global capital markets, as well as the inability to compete, particularly in terms of regulatory standards; over-reliance on external ratings in the regulatory framework for formulating standards, laws and regulations (for example, their increasingly frequent use in determining capital requirements) as well as Central Bank reliance on external credit ratings; and, lastly, the absence of liability for credit rating agencies in relation to the ratings they provide, in which regard the report also proposes to foster the establishment of a European network of credit rating agencies.
The recent financial crisis has highlighted the three main problems credit rating agencies: lack of competition, to the importance of agencies in capital markets, as well the inability to compete, particularly in terms of regulatory standards; over-reliance on in the framework for formulating standards, laws and regulations (for example, their increasingly frequent in determining capital requirements) as well as reliance on external credit and, lastly, the absence of credit rating in relation to the ratings they provide, which regard the report also proposes to foster the a network credit rating agencies.