Fitch Ratings said today that its policy on unsolicited ratings will be initiated only if there is strong investor interest and if it has a materially different credit opinion on a transaction compared to the mandated agencies.
The rating agency received numerous questions from market participants seeking clarification of the agency's policy on initiated ratings and unsolicited comments since publishing its June 3 press release on the U.K. CMBS deal DECO 2011-CSPK, which Fitch was not asked to rate.
Fitch said that instances where initiated ratings are issued are likely to remain rare. Securities and Exchange Commission Rule 17g-5 suggested that rating agencies might increase issuance of unsolicited ratings. However, Fitch said that none of the three largest agencies has yet published a rating under 17g-5.
"In the spirit of the rule, which is designed to address so-called 'rating shopping', an often more effective way to get views across is in the form of an unsolicited comment, such as that for DECO 2011-CSPK," Fitch analysts said. "Nevertheless, the same considerations apply — there must be strong investor interest and Fitch's credit view must be materially different."
Fitch has published two unsolicited comments on new transactions since July 2010. The first was for a servicer advance receivables transaction by American Home Mortgage. The other more recent instance was for the aforementioned DECO transaction, which was not, in fact, subject to 17g-5.