Together with the Federal Ministry of Finance and the Deutsche Bundesbank, BaFin has published a German action plan to reduce over-reliance on external ratings in legal provisions, laws and regulations.
The aim is to create incentives for market participants to perform and promote their own credit risk assessments instead of relying exclusively and mechanically on ratings. The publication is part of a Peer Review of the Financial Stability Board (FSB).
In October 2012, the G20 had agreed on a roadmap with specific timeframes to reduce the mechanistic reliance on ratings issued by the credit rating agencies (CRAs). To speed up progress in this area and to assist the national authorities in implementing the roadmap, the FSB performed a thematic Peer Review for this purpose, which was structured in two stages. The first stage comprised a structured stocktaking of references to ratings in national laws and regulations. In this regard, the FSB published a report in August 2013. In the second stage, the national competent authorities developed appropriate action plans.
Already in February 2014, the Joint Committee of the three European supervisory authorities (ESAs) also published a report on the consequences of references to ratings in the guidelines and recommendations of the ESAs.
Full press release
Full Action Plan
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