Path:Sino-US›› Hot Topics>> 2012>> Credit Ratings>> Media››
Agencies from China, US, Russia start new rating group

Three of the world's independent credit ratings agencies are uniting to create the Universal Credit Rating Group that will lead to a system of comparable, global credit ratings. China’s Dagong Global Credit Rating is tying up with US and Russia partners to reform the current system.


The new agency is also sponsored by Egan Jones Ratings from the US, and Russia’s RusRating.


It promises to be an entirely independent rating service provider. A quality absent in the existing ones.


Guan Jianzhong, president of Dagong Global Credit Rating, said, "The current rating system is geo-centric, and the standard is often politicised and ideologically-biased, thus not adequate to produce responsible and reliable ratings."


Credit rating is based on trust and truthfulness, but speakers say that it might also be kidnapped by a certain interest group, as was exposed in the global credit crisis.


US based Egan Jones Ratings was among the first to provide early warnings on companies like AIG, Lehman Brothers, and some EU countries. Company President Sean Egan believes it’s essential to put ethics into the rating system.


Sean Egan, president of Egan-Jones Rating, said, "There’s nothing unethical than a decline from triple A level down to the D level in a period of months. And this happens time and again in the past five years. We have the responsibility to recognise the sickness in the system and make adjustment to it."


Universal Credit Rating Group is set up to construct a new international credit rating system, develop uniform criteria, establish a supervision system, and in long run, disseminate impartial rating information around the world.


From Moscow, RusRating focuses on rating for the banking sector. It’s President Richard Hainsworth says the new system will answer to the need for global standard and comparable credit rating.


Hainsworth said, "The biggest rating agencies are being criticised in Europe, in Asia, in Russia, because they get it wrong. Their system does not encompass the world, it’s too inflexible. What we are trying to do is to provide another viewpoint, more flexibility, and they will follow along. "


Universal Credit Rating Group will be set up in six months, with its headquarters in Hong Kong.


Reporter: “Experts say that the global credit crisis has demonstrated the flaws in the current rating system, and highlighted the importance of impartial credit rating. The creation of the Universal Credit Rating Group, an agency that is multilateral, independent and international is a first step toward reform.”


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