Requirements for credit rating agencies’ methodologies and disclosures: Bank of Russia’s draft ordinances
The Bank of Russia has drafted requirements for the content, the check of the quality of credit rating agencies’ (CRAs) methodologies and their assessment by the regulator, as well as for disclosures on CRAs’ websites and deadlines for publishing disclosed information. The Bank of Russia has released the draft ordinances for public consultations. This will help establish uniform rules in the market and enhance confidence in the rating industry.
A CRA’s credit rating methodology should provide for the check of the validity of ratings, the agency’s own assessment of rated entities’ creditworthiness and the uniform application of the terms related to default events and ensure the comparability of the types of rated entities.
CRAs should check the quality of their methodologies in the course of their development and revision, as well as at least every three years. The Bank of Russia, in turn, will assess their methodologies for compliance with law.
On their websites, CRAs should disclose not only information about their organisations and internal documents, but also the list of assigned ratings, methodologies, and data on rating processes.
The Bank of Russia welcomes any suggestions and comments through 30 April 2023.