Big Three (credit rating agencies)

The Big Three credit rating agencies are S&P Global Ratings (S&P), Moody's, and Fitch Group. S&P and Moody's are based in the US, while Fitch is dual-headquartered in New York City and London, and is controlled by Hearst. As of 2013 they hold a collective global market share of "roughly 95 percent"[1] with Moody's and Standard & Poor's having approximately 40% each, and Fitch around 15%.[2]

According to an analysis by Deutsche Welle, "their special status has been cemented by law — at first only in the United States, but then in Europe as well."[1][3] From the mid-1990s until early 2003, the Big Three were the only "Nationally Recognized Statistical Rating Organizations (NRSROs)" in the United States — a designation meaning they were used by the US government in several regulatory areas. (Four other NRSROs merged with Fitch in the 1990s.)[4]

The European Union has considered setting up a state-supported EU-based agency.[5]

The Asian credit rating market is relatively diverse. Due to the regulation by the China central government, the Big 3 penetration into the domestic market especially in China is considered less competitive than the local well-recognized agencies, namely China Chengxin International (CCXI), China Lianhe Credit Rating (Lianhe Ratings), New Century Zixin Assessment Investment Service, Pengyuan Credit Rating etc.

  1. ^ a b Alessi, Christopher. "The Credit Rating Controversy. Campaign 2012". Council on Foreign Relations. Archived from the original on 27 July 2013. Retrieved 29 May 2013.
  2. ^ Hill, Claire A. (2002), "Rating Agencies Behaving Badly: The Case of Enron", Conn. L. Rev. 35, 1145
  3. ^ "S&P warning puts damper on Eurogroup plans". 05.07.2011. Deutsche Welle.
  4. ^ "U.S. SEC Report on the Role and Function of Credit Rating Agencies in the Operation of the Securities Markets" (PDF). January 2003. Retrieved 5 April 2012.
  5. ^ The Times, 3 June 2010, Europe launches credit ratings offensive

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