Discussion Paper

The Dodd-Frank Act’s Potential Effects on the Credit Rating Industry

Abstract: Credit rating agencies have been widely criticized in recent years for the poor performance of their ratings on mortgage-backed securities (MBS) and other structured-finance bonds. In response to the concerns of investors and other market participants, the 2010 Dodd-Frank Act incorporates a range of reforms likely to significantly reshape the rating industry. In this post, we discuss these reforms and their implications for investors, regulators, and the rating agencies themselves.

Keywords: Dodd-Frank Act; mortgage-backed securities; credit rating agencies; MBS; structured finance;

JEL Classification: G2;G1;

Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Liberty Street Economics

Publication Date: 2012-02-15

Number: 20120215