No Drastic Changes for Standard & Poor’s

In comments to Reuters, Standard & Poor’s President Deven Sharma said that a credit rating agency board, as proposed by the bank reform bill, would not disrupt his firm’s business model.

“We will have to go to investors and convince them that, ‘look, you still want a rating from us.’ We’ll have to work harder to get those mandates from the investors and from the issuers directly.”

Mr. Sharma also commented that his company had taken measures to add more checks and balances since the subprime mortgage crisis. “For example, it is going to be much more difficult for a mortgage-backed security to get a triple-A going forward.”

After pointing out various changes in his organization around analytics and various other governances, he offered, “Not everything went right in the past, and we recognize that. And there were analytical misses, and we know we have to learn from that and fix things. But at the same time, we are going to stay true to our purpose, which is offering a risk benchmark and calling it as we see it and taking the heat as it comes along.”

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