Standard & Poor's revamps credit rating methodology for finance companies moving to more prescriptive approach

By Gareth Vaughan

Standard & Poor's is revamping its credit rating methodology for finance companies, with plans to introduce more prescriptive, post-global financial crisis criteria than the existing more principles based approach that has been in place for a decade.

The credit rating agency plans to introduce an anchor, or starting point, for rating finance companies in a given country. This will reflect the economic and industry risks the sector faces, and will be set three notches below a country's existing S&P bank anchor.

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