Rating Agencies Must Disclose Fees

The Accountability and Transparency of Rating Agencies Act of 2010 requires each rating agency to publish the type and number of ratings provided to an issuer. Also, the rating agency must publish fees paid for each rating.  The rating agency must publish the aggregate amount of net revenue earned in the preceding two fiscal years attributed to the issuer.

Clearly, the disclosure of the rating fees will highlight any attempt by a new entrant to undercut the fees charged by the rating agencies.

However, one might well wonder how an issuer will react upon learning the rating agencies charge different amounts.  Do rating agencies play favorites?

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