G7 to discuss role of credit rating agencies in financial mkts crisis - sources |
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Mon, 15 Oct 2007 10:23
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FRANKFURT (Thomson Financial) - The G7 industrial states will discuss, among other things, the role played by credit rating agencies in the context of turbulence that erupted in the US sub-prime mortgage market, government sources said.The G7 finance ministers will meet in Washington next weekend.The sources said next week's discussions do not aim to come up with measures regulating the rating agencies, but will focus solely on the role they played in the financial markets crisis worldwide.'There will be no automatic answers on the role they played. The focus will be on how the financial crisis erupted and what was the role of the rating agencies in terms of how the whole crisis could have been prevented,' one source said.Rating agencies have been accused of failing to give investors adequate warning of the risks associated with mortgage-backed securities, which have played a key role in triggering the crisis in US sub-prime real estate markets.Bundesbank president Axel Weber last week cautioned against the rash introduction of a regulatory framework regarding rating agencies.Last week too, European Central Bank president Jean-Claude Trichet called for an examination of the role of rating agencies in the recent correction in credit markets.'An assessment of the role played by rating agencies needs to be undertaken,' Trichet told the European Parliament's economic and monetary affairs committee.marilyn.gerlach@thomson.commog/cmrCOPYRIGHTCopyright Thomson Financial News Limited 2007. All rights reserved.The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
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Trichet says intl action may be needed on any failures by ratings agencies 