24.6.2011
By Simon Miller
Preliminary talks have started to create a European rating agency in Frankfurt.
Roland Berger Strategy Consultants, the federal state of Hesse, Frankfurt Main Finance and the Frankfurt Stock Exchange Deutsche Börse have begun talks to establish a rating agency in Germany as a check on US-based firms.
The move comes on the back of growing anger at the established "big three" ratings agencies which European politicians have blamed for contributing to the financial crisis in 2008 and the continuing downgrading of sovereign debt in the Eurozone.
According to Markus Krall, senior partner and global head of Risk Management at Roland Berger Strategy Consultants, the problem of the issuer paying could be solved in "close cooperation with market infrastructure providers such as exchanges".
He added that this was "a critical element to reduce conflicts of interest and restore credibility of and confidence in ratings."
Lutz Raettig, chairman of the Presidential Committee of Frankfurt Main Finance and chairman of the Council of Frankfurt Stock Exchange, commented: "The complete and true independence of the agency will be crucial and Frankfurt is the place to get started, as it provides the natural proximity to and intensive exchange with the European Central Bank and the European Systemic Risk Board."
Europe-wide companies and institutions have been invited to participate in the discussions and the setup of the initiative.
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