European ratings agency ‘imminent’

PLANS to launch a European ratings agency to compete with S&P, Moody’s and Fitch are at an advanced stage and a new private institution could start business as soon as the first half of this year, German businessman Roland Berger told an Italian newspaper over the weekend.

The founder of the Roland Berger strategy consultancy said he hoped a new private, non-profit organisation, in the form of a foundation, could be ready in “the first half or the first nine months of the year,” according to Saturday’s Corriere della Sera.

Mr Berger, who has been lobbying European governments and companies to gather support and financing for a new agency, hopes to have raised the €300 million of capital needed from European investors by that time.

“The proposed model is of an agency where the service is paid by the clients, who have an interest in having reliable and objective results,” Mr Berger said.

Roland Berger partner Markus Krall, who is largely tasked with setting up the agency, told Germany’s Euro am Sonntag weekly that it would differentiate itself from competitors by accepting liability for its analysis.

This would mean customers could potentially claim damages from the agency, which Mr Krall said provides a “strong incentive” to provide accurate analysis.

“Currently ratings are — legally speaking — purely opinion and are not subject to any product liability [laws],” Mr Krall told the paper in comments published on Saturday.

Mr Berger’s plan for the new agency, which would be incorporated in the Netherlands, has received signals of support from the European Commission and governments in Europe, but also in China and among some Arab states, the paper said.

Reuters