International Banker article, 11 December 2025
Why Is the Oligopoly in the Credit-Rating Market So Tenacious?
By Yuefen Li
International Banker article,
Large, established credit rating agencies (CRAs) wield immense influence and power over the global financial system and the world economy as a whole. In normal times, CRAs can significantly impact financial markets, financial-instrument issuers’ behaviors and investors’ perceptions, thus constituting a major determinant of the cost of borrowing and the direction of the money flow. During economic downturns, rating downgrades can become self-fulfilling, as herd behavior amplifies the effects of ratings. A downgrade by a major ratings agency can make or break an entire economy, as witnessed during the European debt crisis. The then prime minister of Greece accused the ratings agencies of “seeking to shape our destiny and determine the future of our children.” …
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This article was tagged: Credit Rating Agencies
