Talk:Credit rating agency
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Look, there needs to be a clear distinction between US and UK credit mechanisms. This is important information thats usless in its current format.
- What are the distinctions? Corporate bonds are corporate bonds. Sovereign bonds are sovereign bonds. (162.138.176.51 18:27, 16 May 2006 (UTC))
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[edit] Fair Isaac Corporation and the FICO scores
Will someone please mention Fair Isaac Corporation and its FICO score formula? Its rather important to correctly identify how they relate to the credit rating score.
User:Quarl has merged credit reference/reporting agency with credit rating agency under the overall title of credit rating agency. I would note the following:
- This merge was done without any discussion whatsoever, or without a merge tag being added.
- Credit reference agencies and credit rating agencies are two entirely different operations and surely deserve separate articles. The credit reference agencies go to great lengths to persuade people that they are not credit rating agencies.
- Please discuss. Arcturus 18:43, 8 March 2006 (UTC)
Okay, the articles seemed to be about the same thing to me, feel free to unmerge and discuss the difference in the articles. Top Google hit for both "credit rating agency" and "credit reference agency" is Equifax. —Quarl (talk) 2006-03-08 21:41Z
- I'll leave it for a while to see if any other views are forthcoming. Another option would be an article of a completely different name, which includes rating and reference agencies, credit reporting industry or something like that. Arcturus 18:10, 10 March 2006 (UTC)
I think they should be unmerged. Rating agencies and credit bureaus are two entirely different animals. One deals with consumer credit, with banks as the client, the other with bond ratings with investors as the client. In theory these are similar, but the reality is very different. One is mechanical and done almost entirely by mathematical algorythm, the other involves committees, interviews, and (supposedly) in-depth analysis of financial statements. The problematical issues are entirely different, too. Finally, one "reports", while the other "rates" or "opines". (A credit bureau doesn't say this individual's chances of default are X. Rather, it says individuals with these characteristics tend to default this frequently. A CRA, by contrast, actually says "We think this company's chances of default on this bond are X.") 70.92.247.123 20:32, 12 April 2006 (UTC)
[edit] Separated out credit bureaus from CRAs
Consumer credit ratings and credit rating agencies are sufficiently different to warrant separate headings. (Epstein's Mother 20:23, 25 April 2006 (UTC))
[edit] Dun & Bradstreet, Inc. v. Greenmoss Builders
I put this under "Credit Bureau" rather than here because the case actually deals with a private credit report on a company, and it is not clear that it would apply to an actual credit rating agency. (Also, I changed "high court" to "Supreme Court" and deleted the reference to Bose because it is unclear from the context why Bose would be considered a public figure. Did you mean a public company? If so, Bose is not a public company.) One of the reasons that the D&B case may not apply here is that CRAs "rate" mostly public companies. Furthermore, unlike the D&B case, the largest CRAs make their ratings public, whereas D&B reported the false information to only five subscribers. Epstein's Mother 21:10, 14 September 2006 (UTC)
[edit] fees
it would be nice to put here some information about the average fees asked by cra to make their ratings. 90.152.2.74 09:50, 9 March 2007 (UTC)
[edit] Cities vs city councils
On the 2nd line the article mentions cities. Would it not be more accurate to say that the credit rating is actually assigned to the council?
Zain Ebrahim 11:45, 6 September 2007 (UTC)
[edit] Conflict of interest section
These agencies meet frequently in person with the management of many companies, and advise on actions the company should take to maintain a certain rating. Furthermore, because information about ratings changes from the larger CRAs can spread so quickly (by word of mouth, email, etc.), the larger CRAs charge debt issuers, rather than investors, for their ratings. This has led to accusations that these CRAs are plagued by conflicts of interest that might inhibit them from providing accurate and honest ratings.
This is a good observation and it seems Mr Trichet, the European Central Bank president agrees with this observation
Mr Trichet says lessons need to be learned from the fact that the fees of the credit rating agencies are paid by the very financial institutions whose bonds they are assessing.
hese bonds were frequently given coveted AAA ratings by the three credit rating agencies usually a sign that an investment is safe.[1] —Preceding unsigned comment added by Wk muriithi (talk • contribs) 04:46, 14 September 2007 (UTC)
[edit] Article title
The use of the word "agency" is a misnomer and implies, at least in the US, that there is some kind of governmental relationship. These companies aren't "agencies." They are most often referred to as "ratings firms" in the US press. NoGutsNoGlory (talk) 18:18, 30 March 2008 (UTC)
- There is no implication of government relationship in the title. There are many different types of agencies other than those of the government. For instance, modeling agencies, travel agencies, etc. Further, "agency" is the proper title for these organizations as that is both what they call themselves and is their official business designation. See [2]. I don't know where you got this idea that they are referred to as firms in the press. See [3] [4] [5][6] --Ave Caesar (talk) 18:24, 30 March 2008 (UTC)
