Comments on: Time for banks to gang up on rating agencies http://blogs.reuters.com/breakingviews/2012/05/28/time-for-banks-to-gang-up-on-rating-agencies/ Mon, 26 Sep 2016 03:26:00 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: thoma http://blogs.reuters.com/breakingviews/2012/05/28/time-for-banks-to-gang-up-on-rating-agencies/comment-page-1/#comment-9322 Wed, 06 Jun 2012 02:21:52 +0000 http://blogs.reuters.com/breakingviews/?p=11728#comment-9322 rate the rating agencies – if they get it wrong on the downside sock it to them

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By: RenJ http://blogs.reuters.com/breakingviews/2012/05/28/time-for-banks-to-gang-up-on-rating-agencies/comment-page-1/#comment-9280 Tue, 29 May 2012 07:29:42 +0000 http://blogs.reuters.com/breakingviews/?p=11728#comment-9280 If ratings reflect the cedit quality of a bank then why is this a problem ones a ratingagency gives the bank a downgrade?
Like you said Moody’s gives these banks months to prepare, counterparties need something to protect themselves from over risk taking counterparties like the ones you mentioned. The downgrade reflects the increased risk (though a little late) and gives investors some sort of protection. Ratings are therefore a ruler that is widely accepeted. The risk is a problem not the ruler.

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