Rating Shopping or Catering? An Examination of the Response to Competitive Pressure for CDO Credit Ratings

Griffin, John M.; Nickerson, Jordan; Tang, Dragon Yongjun

doi:10.2139/ssrn.2209358

Cited by 54 publications

(76 citation statements)

References 11 publications

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“…Table 2 and Table 3 Overall, roughly $681 billion dollars of CDO capital was originated during the period from 2009 to 2013. As a result, 46% of total capital was assigned a AAA rating, a sizable divergence from the 75-80% AAA capital level that Griffin and Tang (2013) find in their paper. This decrease in percentage of AAA total capital suggests that rating agencies were assigning smaller portions of low risk tranches to CDOs.…”

Section: Data and Descriptive Statisticsmentioning

confidence: 74%

“…Notably, the number of deals and total issued CDO capital in the post-crisis sample is less than the sample size in the study by Griffin and Tang (2013). This relatively smaller sample in the post financial crisis period is the result of increased investor caution after frequent defaults and major downgrades of CDOs during the recession.…”

Section: Data and Descriptive Statisticsmentioning

confidence: 77%

“…Section 6 analyzes the downgrades experienced by single and dual-rated CDOs to identify potential rating catering. Section 7 concludes and contrasts the findings of the study with those of Griffin and Tang (2013).…”

Section: Hypothesismentioning

confidence: 95%

“…Prior to the financial collapse, investor demand for CDOs was high and the structured product market was experiencing a boom. As a result, Griffin and Tang (2013) examine rating agencies' behavior during the period of rising demand and deal flow. On the other hand, data from 2009 to 2013 provide a smaller sample size because investor demand was much more conservative.…”

Section: Data and Descriptive Statisticsmentioning

confidence: 99%

“…Thus, this paper attempts to replicate the study by Griffin and Tang (2013) on pre-crisis rating shopping and catering to uncover investor perception and rating agency behavior toward AAA rated CDOs after the financial crisis in the post Dodd-Frank era.…”

Section: Introductionmentioning

confidence: 97%

See 4 more Smart Citations

A re-examination of rating shopping and catering using post-crisis data on CDOs

Owlett

2016

Economics Letters

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Section: Data and Descriptive Statisticsmentioning

confidence: 74%

Section: Data and Descriptive Statisticsmentioning

confidence: 77%

Section: Hypothesismentioning

confidence: 95%

Section: Data and Descriptive Statisticsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 97%

See 3 more Smart Citations

A re-examination of rating shopping and catering using post-crisis data on CDOs

Owlett

2016

Economics Letters

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The regulatory and policy variables influencing FDI in South Africa

Faku

2021

Journal of Public Affairs

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This paper dealt with the regulatory and policy variables influencing Foreign Direct Investment (FDI) in South Africa. Since the advent of democracy 26 years ago, South Africa had its own share of benefits from democratic rule. This was the period of great success, and three free and fair elections were held without violence and intimidation. The South African government started using the “inflation targeting monetary policy framework” to have an environment where inflation will stabilise. Although in literature it is stated that many governments have adopted this policy in order to lure investors in through their attractive risk‐free returns in their investment portfolios. The paper used unobtrusive techniques to analyse secondary data. The South African investment climate remains faced with challenges, which curtail the full attainment of conditions conducive for quality FDI. When regulations are made less cumbersome, it becomes simpler for investment to flow into the country, and international and local entrepreneurs prosper as the ease of doing business improves. South Africa does not have a complex regulatory framework, but its challenges stem from a lack of regulatory transparency, which impeded investment. TISA the agency, which DTI created to reduce obstacles encountered in FDI offers foreign investors clarification on the regulatory and legal environment. Many countries have also cancelled their BITs with South Africa, including Ecuador, Bolivia, and Venezuela. South Africa's business environment and its investment climate are largely dependent on the events that occur in the political arena and the economic environment.

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US Statutory Regulation

Hemraj¹

2015

Credit Rating Agencies

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Rating Shopping or Catering? An Examination of the Response to Competitive Pressure for CDO Credit Ratings

Cited by 54 publications

References 11 publications

A re-examination of rating shopping and catering using post-crisis data on CDOs

A re-examination of rating shopping and catering using post-crisis data on CDOs

The regulatory and policy variables influencing FDI in South Africa

US Statutory Regulation

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