S&P Global Ratings fined €1.1m by Esma

The EU’s financial markets watchdog has fined S&P Global Ratings €1.1 million for publishing credit scores before the relevant securities had been issued.

The European Securities and Markets Authority (Esma) has also issued a public notice for credit rating agencies (CRA) regulation breaches uncovered after an investigation started in January 2022.

The infringements by the European branch of the New York-based research and analytics giant were between June 2019 and September 2021. Esma announcedthe fine last Friday.

S&P Global Ratings, one of the three largest credit rating agencies in the world, was found to have had “internal control failures” which led to transgressions of its own transparency obligations.

The overall penalty cost came from three separate fines of €825,000, €210,000 and €75,000.

Esma chair Verena Ross said: “Publishing a credit rating before the issuance of the rated securities may result in harm to the issuer, to investors, and more generally to the orderly functioning of the financial markets.”

Investigators discovered the problem had happened on six occasions.

Other rule breaches included a failure to disclose on a “non-selective basis and in a timely manner” why it had withdrawn credit ratings.

The company was also found to have failed in its obligation to submit up-to-date rating information to Esma.

All breaches were due to S&P’s negligence, the regulatory body said.

In a statement, S&P Global Ratings said: “SPGR is pleased to have concluded this matter. SPGR takes compliance with its regulatory obligations very seriously and is committed to transparency and the integrity of its ratings process to ensure high-quality, timely and independent credit ratings.”

© 2023 funds europe 

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