Does Regulatory Certification Affect the Information Content of Credit Ratings?

• 成果类型: Article
• 署名作者: Bruno, Valentina; Cornaggia, Jess; Cornaggia, Kimberly J.
• 署名单位: American University; Georgetown University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2015.2188
• 发表日期: 2016
• 页码: 1578-1597
• 关键词: credit ratings; NRSRO; capital markets regulation; certification

摘要

We exploit an investor-paid rating agency's designation as a Nationally Recognized Statistical Rating Organization (NRSRO) to test whether this certification affects the agency's information production. We use a certified issuer-paid agency as a benchmark and find robust evidence that the investor-paid agency's ratings policy-both timelier and more symmetric with respect to positive and negative information-persists after it became certified for regulatory compliance. Our results suggest that ratings policy is more a function of rating agency compensation structure than the NRSRO certification by the U.S. Securities and Exchange Commission.