Tuesday December 16 2014
News Source: Global Exchanges
Focus: Other
Type: General
Country: European Union
The European Securities and Markets Authority (ESMA) has published a report on the findings of its investigation into the way credit rating agencies (CRA) conduct surveillance of their structured finance credit ratings.
The investigation, which took place between October 2013 and September 2014, was prompted by the continued relevance of structured finance products and the high outstanding volume in issuance. It focused on the four largest CRAs providing credit ratings on these finance instruments in the EU – DBRS Ratings, Fitch Ratings, Moody’s Investors Services and Standard & Poor’s – which account for almost 100% of the total outstanding credit ratings on EU structured finance instruments.
In its investigation ESMA identified a number of shortcomings in several areas affecting the surveillance of structured finance ratings for the CRAs investigated. ESMA also identified weaknesses on the level of disclosure and transparency which could be detrimental to investor protection.
ESMA has not determined whether any of the Report’s findings constitute a breach of the CRA Regulation, and may take action as appropriate in due course.
Click here for ESMA’s investigation into structured finance ratings.
Click link above for further details.