S&P shadow rating crackdown could hit mid-market funds

By Mike Peterson

Monday, July 04, 2011

Standard & Poor’s has told CLO managers and other users that it will cut down its issuance of shadow ratings

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Comment by: Mike Peterson. Posted 12 years ago [2011-07-06 10:29:30]

The thresholds for borrower size referred to in the article are based on outstanding debt rather than turnover, as we originally stated. This has now been corrected in the version above. Apologies for the confusion.

Comment by: Anonymous. Posted 12 years ago [2011-07-04 16:35:18]

One motivation could be the new regulatory landscape. Both the SEC in the US and ESMA in Europe are prompting the rating agencies to demonstrate they have sufficient information and data to issue ratings. It may be that shadow ratings (as contributors to CLO ratings) are particularly open to criticism on this ground.

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