Business Case Studies, Fiscal Policy Case Study, Credit-Rating Agencies,Rating

print page
Tell A Friend

Case Categories

Fiscal Policy Case Study

Case Title:

Rating the Credit-Rating Agencies

Publication Year : 2005

Authors: Indu Prasad & Hansa Iyengar

Industry: Consulting


Case Code: FCP0011B

Teaching Note: Not Available

Structured Assignment: Not Available

Buy This Case Study

Credit rating started in USA in the late 19th century when early rating agencies began publishing financial analyses on railroad companies. Over the years, numerous regulations were created to govern the level of non-investment grade debt that institutional investors (banks, insurance companies and corporate pension funds) could own. But the turn of the 21st century brought a slew of problems for the credit rating agencies (CRAs) as they failed to detect signals of the collapse of companies like Enron Corp. and WorldCom Inc. The creditworthiness of the rating agencies and validity of the processes and methodologies adopted for rating began to be questioned and demands for strengthening regulations began to be made. The Congress began to pressurise the SEC to re-examine the role of credit rating agencies and proposed greater oversight of the rating firms’ anticompetitive practices and conflicts of interest. A debate on whether subjecting rating agencies to substantive monitoring by the SEC and abandoning the NRSRO designation also ensued. A few critics also proposed establishing a separate regulatory set-up to monitor the rating agencies. The major question revolved around the extent of regulatory involvement in ensuring the safety and soundness of the rating process. Experts felt that these regulations would change the very nature of the rating industry in the US.

Pedagogical Objectives:

  • To discuss what is Credit Rating
  • To discuss the credibility of credit rating agencies
  • To discuss the effective criteria’s to rate companies, shares and bonds.

Keywords : Credit Rating Agencies, Standard 7&, Poor's, Fitch Rating Services, Moody's, Enron Scandal, Fiscal Policy Case Study, WorldCom Scandal, Sarbanes-Oxley Act, US Credit Rating, History of Credit Rating, NRSRO, Credit rating regulations, Dun &, Bradstreet, Credit ratings, Credit rating marketing

Recently Bought Case Studies

    Recently Bought Case Studies

    Executive Interviews

  • David ConklinDavid Conklin

    David Conklin, is a professor at the Richard Ivey School of Business
    Speaks on Government and Business
  • Lord Meghnad DesaiLord Meghnad Desai

    Lord Meghnad Desai, is an Indian-born British economist and Labor politician
    Speaks on Government and Business
  • Vijay GovindarajanVijay Govindarajan

    Vijay Govindarajan, is widely regarded as one of the world’s leading experts on strategy and innovation
    Speaks on Reverse Innovation
  • View All Executive Interviews»

Contact us: IBS Case Development Centre, Survey No. 156/157, Dontanapalli Village, Shankerpalli Mandal, Ranga Reddy District, Hyderabad-501203, Telangana, INDIA, E-mail:

©2020-2025 IBS Case Development Centre. All rights reserved. | Careers | Privacy Policy | Terms of Use | Disclosure | Site Map xml sitemap