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Elise Brooks, (202) 589-2427

 

Role of Credit Rating Agencies as Risk Information Brokers
Roundtable Releases Third Cluff Fund Study of 2010

 

Washington, D.C.—February 18, 2011—The Financial Services Roundtable today released its third and final Cluff Fund report of 2010: the Role of Credit Rating Agencies as Risk Information Brokers. 

“Credit Rating Agencies (CRAs) play an important role in our capital markets,” said Steve Bartlett, President and CEO for the Roundtable. “Their role, uniquely positioned to provide investors much needed information, continues to be crucial as we regain trust and confidence in the investment community.”

In particular, the report demonstrates that:

• An independent, third-party, risk information intermediary is needed in the investment and banking communities to facilitate the buy-sell process.

• Thus, an operating model for CRAs that is less dependent on regulation, and more driven by market needs is superior and should be identified if possible.

• A subscriber-pay model, whereby credit rating agencies sell via a subscription risk data and risk scores to banks for consumer lending, offers a compelling business model for future CRA operations in the credit-backed securities market.

The Role of Credit Rating Agencies as Risk Information Brokers is available online at: http://www.fsround.org/publications/pdfs/2011/CRAs_final.pdf.

The Financial Services Roundtable represents 100 of the largest integrated financial services companies providing banking, insurance, and investment products and services to the American consumer.  Member companies participate through the Chief Executive Officer and other senior executives nominated by the CEO.

Roundtable member companies provide fuel for America's economic engine, accounting directly for $92.7 trillion in managed assets, $1.2 trillion in revenue, and 2.3 million jobs.