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Strong Debt Issuance Volumes Drive Higher Ratings Revenue Forecasts
The recent Goldman Sachs study highlights an impressive growth in global debt issuance volumes during the fourth quarter of 2024, which has significantly impacted ratings revenue forecasts for major players such as S&P Global (SPGI) and Moody’s Corporation (MCO). This development underscores the resilience of the financial markets and provides a promising outlook for 2025. Robust Growth in Debt…
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The Development of Scope Ratings’ Market Share 2024
Scope Ratings GmbH, a European credit rating agency (CRA), has shown a consistent, albeit modest, increase in market share over recent years. According to the 2024 CRA Market Share Report published by the European Securities and Markets Authority (ESMA), Scope Ratings’ market share grew to 1.83% according to the 2024 report, compared to 1.72% in 2023. This represents a year-on-year increase of…
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Strategic Shift Towards Bonds in apoBank’s Capital Market Outlook 2025
The Deutsche Apotheker- und Ärztebank (apoBank) has announced a significant shift in its capital market strategy for 2025. Germany’s largest cooperative primary bank is adopting a more defensive investment approach, moving from a “neutral” stance on equities to an “underweight” position. Simultaneously, apoBank is increasing its allocation to bonds, shifting to an “overweight” stance. “The…
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Angela Merkel's Shortcomings During the Global Financial Crisis
Angela Merkel’s new book, “Freiheit: Erinnerungen 1954–2021”, offers an in-depth reflection on her life and 16-year tenure as Germany’s first female Chancellor. Co-written with her long-time advisor Beate Baumann, the memoir spans Merkel’s early years in East Germany, her rise in the unified German political landscape, and her navigation of major global crises, including the Eurozone crisis, the…
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Moody's Acquisition of Numerated: Implications for the Credit Rating and Lending Industry
Moody’s Corporation (NYSE: MCO) has announced the acquisition of Numerated Growth Technologies (Numerated), a cutting-edge loan origination platform tailored for financial institutions. This move strengthens Moody’s Lending Suite capabilities, offering banking clients a comprehensive, end-to-end solution for loan origination and monitoring. The acquisition, which builds on a partnership initiated…
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Stability and Continuity: Implications of China’s Approach for Corporate Credit Ratings
In an era defined by uncertainty, businesses and investors are increasingly seeking stability and continuity as key indicators of creditworthiness. This theme was underscored during Yiyang Huang’s address at the 10th China Day, held as part of the 27th Euro Finance Week. Representing the Consulate General of the People’s Republic of China, Huang highlighted China’s political and economic…
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Trump’s Victory: Implications for Global Corporate Credit Ratings Across Sectors and Regions
The election of Donald Trump, as discussed by Prof. Dr. Jan Viebig of ODDO BHF SE, carries significant implications for the credit ratings of companies across different countries and sectors. His policies, characterized by a shift toward protectionism, corporate tax cuts, and deregulation, are likely to have distinct effects on credit stability, particularly impacting European industries that…
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Trump reloaded
According to the first official election results, Donald Trump is the clear winner of the 2024 presidential election. This means that the USA is facing an extremely critical turning point in its history. “Now the exact scenario that we have already predicted several times is occurring: America is on a direct path to autocracy,” says Dr. Heinz-Werner Rapp, founder and director of the FERI…
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Landmark Ruling Strengthens Rating Agencies' Role in Assessing Bank Creditworthiness
The recent judgment by the Federal Court of Justice (Bundesgerichtshof, BGH) in the case surrounding Greensill Bank underscores the significance of rating agencies in assessing a bank’s creditworthiness. The case, involving a municipality’s lost investment, highlighted the role of financial service providers and affirmed the reliance on ratings from established agencies as primary indicators of a…
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Moody’s Reports Record-Breaking Third Quarter 2024 with Strong Revenue Growth and Raised Earnings Outlook
Moody’s Corporation delivered outstanding results for the third quarter of 2024, highlighting the company’s resilience and ability to capitalize on favorable market conditions. Revenue for the quarter surged by 23% compared to the same period in 2023, reaching an impressive $1.8 billion. This growth was driven largely by the stellar performance of Moody’s Investors Service (MIS), which saw its…
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The Growing Role of AI in Financial Markets: Implications for Rating Agencies Relying on Artificial Intelligence
OpenAI has been at the forefront of the artificial intelligence (AI) revolution, significantly capturing public attention with the release of its language model, ChatGPT. Now, OpenAI is on the brink of another significant transformation: its shift toward becoming a profit-driven entity. As reported by Brice Prunas, portfolio manager of ODDO BHF Artificial Intelligence, OpenAI is poised to expand…
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DekaBank Partners with Scope: A Long-Awaited Milestone for a Berlin Rating Agency
In a recent announcement, Deka, the securities services provider of the German Savings Banks Finance Group (Sparkassen-Finanzgruppe), revealed its decision to fully integrate and use Scope’s credit ratings across its operations. This development might be seen as an impressive achievement for Scope, but it also raises a critical question: why does the news of securing a major German client seem…
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Moldova Receives 'B+' Rating with Stable Outlook from Fitch Ratings
Fitch Ratings has assigned the Republic of Moldova a Long-Term Foreign-Currency Issuer Default Rating (IDR) of ‘B+’ with a Stable Outlook. This rating highlights the country’s steady commitment to maintaining macroeconomic and financial stability through prudent fiscal policies, a credible inflation-targeting framework, and a flexible exchange rate regime. These factors, combined with a resilient…
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Rating does not protect against deception
Deutsche Konsum REIT-AG is not only causing concern for the financial regulatory authority but also for a rating agency. The Berlin-based rating agency Scope Ratings had praised the company’s creditworthiness with good ratings. However, these historical ratings must now be reviewed because the German Federal Financial Supervisory Authority (BaFin) has determined that the individual financial…
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Opportunities and Risks for Moody's Following the Acquisition of Praedicat
Moody’s Corporation, a prominent player in financial services and risk assessment, has recently announced its acquisition of Praedicat, a leading provider of casualty insurance analytics. This strategic move marks a significant expansion in Moody’s capabilities within the insurance sector, promising both notable opportunities and potential risks. Opportunities Enhanced Risk Assessment…
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Investing in Safe Assets: A Focus on Scandinavian Bonds
In today’s increasingly appealing interest rate environment, investors should focus more on “safe assets,” says Jan Schopen, Portfolio Manager and Analyst with the Global Fixed Income Team at Lazard Asset Management. While German government bonds, covered bonds, and other core European bonds remain viable, Schopen identifies another attractive option: high-quality bonds from…
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Moody's gives away EU market share for free
The decision by Moody’s to cease endorsing ratings of US municipal bonds for use in the European Union (EU) has led to significant implications for the market shares of credit rating agencies (CRAs). This move resulted in the removal of approximately 290,000 sovereign ratings from the ESMA RADAR database, thereby causing a notable reduction in the total number of outstanding ratings in early…
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