Dear clients,
Times of crisis present critical challenges for credit rating agencies.
During a crisis, these agencies are faced with complex dilemmas and legal exposure. Very few foresaw the extreme scenario that the world has encountered over the past few months.
Expecting rating agencies to include such an extreme scenario in the risk factors they considered appears, at first glance, to be exaggerated.
However, as the crisis began to spread to every inhabited corner of the planet, many questions have arisen in this regard.
Were the ratings given by the rating agencies on the eve of the crisis accurate, and do they remain so?
Did the rating agencies react to the upheaval in time, and was their response measured and reasonable?
Have they been able to analyze how the event may affect companies in different sectors, different companies in the same sector, or different financial instruments?
This article sheds some light on legal implications related to the rating agencies' activity under these extreme circumstances.
For the full article, please click here.
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