During the traumatic financial crisis that began in 2008, the rating agencies deserved special mention for the mistake of rating with the best solvency rating, triple A, subprime mortgages in the US and also for their enormous influence on the 'time to measure the credit quality of European countries in the worst moments for sovereign debt.
Fifteen years later the old acquaintances S
"In 2008, a financial engineering was developed in which the investment banks went ahead of the agencies, who did not want to lose the market", explains Adolfo Estévez, general manager of EthiFinance, the former Axesor and the main rating evaluator in Spain, with 90% of the Marf debt market (alternative fixed income market).
"After the crisis, the agencies have redefined the methodologies to apply them consistently and to the letter. Now the method is simple, transparent and standard. It went from the Far West to something boring, which is what it should be," he says.
The EU has approved six regulations so that the methodology of these agencies is public and so that the rating of the countries is reviewed outside market hours and in accordance with a pre-established calendar. New risk models have also been established, including ESG (environmental, social and governance) and regulatory criteria supervised by the European Securities and Markets Authority (Esma). Added to this is the entry of new competitors, such as the German Scope, and the consolidation in Spain of EthiFinance.
Santiago Carbó, professor of Economics at the University of Valencia and director of financial studies at Funcas, explains that in recent years the rating agencies "have not given importance to sovereign or corporate debt" due to the pandemic and the invasion of ' Ukraine, but "there could be a change in perception in view of some kind of setback or unforeseen".
His impression is that the rating agencies "have been refining" in recent years. "Ten years ago they exacerbated the cycle, which was bearish, so they aggravated the situation" with their decisions. This is no longer the case and their credit reviews look more at the long term. It is only a small consolation because, in their opinion, the moment is uncertain and what is needed is for countries like Spain to focus on "doing their homework" in view of the risk of turbulence.
José Carlos Díez, professor of economics at the University of Alcalá, believes that there is too much complacency. "The markets don't get nervous until they downgrade someone," but the agencies "don't seem too bothered by the current stock of debt." "I have not seen more relaxation on the part of the agencies. They collaborated in the undervaluation of risk before 2007 and now they do so in the dynamics of public debt", he says.
In the case of Spain, the last rating revisions took place in 2018 and were for the better, after the country had been, in the case of Moody's and during the worst years of the economic crisis, just barely a rung of good crap, which is what is known as the degree of speculation. The trauma of 2008 and its echoes have put an end to many myths, including that of US Triple A: S
And what do the rating agencies think of what is to come in 2024? The general manager and head of corporate ratings analysis in Europe of S
In its 2024 forecast report, Moody's has a "stable outlook" for sovereign debt, but says it will be a "difficult year as high debt levels consolidate, growth falters" and "governments they face a delicate balance to adjust their accounts”.
In its latest R isk Radar Fitch says that the international credit environment "has deteriorated" due to "rising interest rates, the accentuation of geopolitical risks and the sudden resurgence of long-scale military conflicts". They are generic assessments that could be specified in specific actions on some issuers.
