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The Extent and Causes of Sovereign Split Ratings

Author

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  • Rasha Alsakka

    (Bangor University)

  • Owain ap Gwilym

    (Bangor University)

Abstract

This unique study employs a rich dataset of ratings from six international agencies to investigate the causes of sovereign split ratings in emerging countries. Three reasons are identified in explaining the relatively high frequency of disagreement across agencies on emerging sovereign ratings. Firstly, rating agencies use different economic factors and different weights on these factors. Secondly, rating agencies disagree to a greater extent about more opaque issuers. Finally, for smaller agencies, issuers in their “home region” tend to be more favoured. The findings should be of interest to a wide range of participants in global credit markets.

Suggested Citation

  • Rasha Alsakka & Owain ap Gwilym, 2010. "The Extent and Causes of Sovereign Split Ratings," Working Papers 10008, Bangor Business School, Prifysgol Bangor University (Cymru / Wales).
    • Handle: RePEc:bng:wpaper:10008
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    File URL: http://www.bangor.ac.uk/business/docs/BBSWP10008.pdf
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    References listed on IDEAS

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    1. Xudong An & Larry Cordell & Joseph B. Nichols, 2020. "Reputation, Information, and Herding in Credit Ratings: Evidence from CMBS," The Journal of Real Estate Finance and Economics, Springer, vol. 61(3), pages 476-504, October.

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