S.E.C. Seeks to Reduce Reliance on Credit Ratings

I found these excerpts appealing. Via DealBook.

Now, the Securities and Exchange Commission is aiming to wean the industry off its dependence on ratings, many of which proved inaccurate during the financial crisis.

“This effort is part of a larger movement across the world to generally reduce reliance on credit ratings,” Mary L. Schapiro, the S.E.C.’s chairwoman, said in a statement.

...

A report generated by the Congressional panel that chronicled the financial crisis called the largest rating agencies — Standard & Poor’s, Moody’s Investors Service and Fitch Ratings — “essential cogs in the wheel of financial destruction” and “key enablers” of the downturn.

...

“Standard & Poor’s believes the market — not government mandates — should decide the value of our work, which is why we support removing rating requirements from financial regulations,” said Ed Sweeney, an S.&.P. spokesman.

Click Here to Read: S.E.C. Seeks to Reduce Reliance on Credit Ratings