Singapore’s central bank recently it had introduced new regulation for credit rating agencies, following moves by other major financial centres.
Under the new rules, credit rating agencies will have to obtain a Capital Markets Services licence from the Monetary Authority of Singapore and follow a new code of conduct. The move follows a consultation with the industry last year.
Credit rating agencies came in for widespread criticism after the financial crisis for failing to adequately spot the risks attached to complex financial instruments.
The industry, dominated by the three major players of Moody’s, Standard & Poor’s and Fitch, has also come in for criticism for not having enough independence from the clients they rate.
The European Union and Hong Kong have already introduced new licensing requirements. [Reuters Tuesday, Jan 17, 2012]