IL&FS crisis fallout: Sebi tightens disclosure norms for credit rating agencies
6 years, 2 months ago

IL&FS crisis fallout: Sebi tightens disclosure norms for credit rating agencies

Live Mint  

Mumbai: India’s markets regulator has tightened disclosure norms for credit rating agencies after they failed to warn investors in time about the deteriorating credit profile of Infrastructure Leasing and Financial Services Ltd. Credit rating agencies would also need to disclose if the company is expecting additional funds to pare its debt along with the name of the entity that will provide the money. This will enable stakeholders including investors and regulators to compare data across each CRA in an efficient and transparent manner and make comparative assessments,” said Somasekhar Vemuri, senior director at Crisil Ratings.NextMAds This is the fourth time Sebi has changed norms for credit rating agencies. In November 2016, Sebi issued a circular revamping norms for rating agencies after it found Crisil and Credit Analysis and Research Ltd did not follow due process and had failed in monitoring ratings of JP Morgan’s credit opportunity fund and Amtek Auto Ltd.

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History of this topic

Sebi to simplify registration for FPIs looking to invest in govt securities
4 days, 22 hours ago

Sebi to simplify registration for FPIs looking to invest in govt securities

Live Mint  

Mumbai: India's capital markets regulator is set to ease the registration of foreign portfolio investors if they want to invest in government-backed securities, even as it proposed doubling the equity investment threshold set for granular disclosures by FPIs to ₹50,000 crore. "There will be zero requirements for a lot of things including investor group all that data will not be …

SEBI Introduces New Guidelines To Enhance Credit Rating Agency Operations
6 months ago

SEBI Introduces New Guidelines To Enhance Credit Rating Agency Operations

Live Law  

The Securities and Exchange Board of India has released a new set of guidelines designed to streamline operations and enhance business ease for Credit Rating Agencies. Under the new framework, CRAs must communicate the rating to the issuer within one working day following the Rating Committee meeting. CRAs are required to publish a press release on their website and notify …

Corporate credit profile was robust in FY24, says India Ratings and Research
9 months, 2 weeks ago

Corporate credit profile was robust in FY24, says India Ratings and Research

Live Mint  

New Delhi: Corporate India’s credit profile reported robust performance during FY24, with 312 issuers seeing credit upgrades and 114 facing downgrades during the fiscal year, rating agency India Ratings and Research said on Monday. The continued improvement in credit profiles could be attributed to similar reasons as in FY23 – deleveraged balance sheets; sound domestic consumption demand, especially in the …

Do Sebi's New Disclosure Rules Impact Large Number Of FPIs?
11 months, 3 weeks ago

Do Sebi's New Disclosure Rules Impact Large Number Of FPIs?

News 18  

Market regulator Sebi does not expect a large number of foreign portfolio investors to be impacted by the new beneficial ownership disclosure norms, according to sources. The sources in the know said FPIs which may be required to provide enhanced disclosures are expected to be significantly less than estimated in the consultation paper and the Sebi board note of October …

Sebi wants ratings agencies to rate all issuers
4 years, 6 months ago

Sebi wants ratings agencies to rate all issuers

Live Mint  

The Securities and Exchange Board of India is not in favour of a demand from credit rating agencies to let them withdraw ratings of uncooperative companies that fail to provide required information, two people aware of the matter said. Rating agencies last week wrote to Sebi and Reserve Bank of India that they wish to stop rating credit instruments and …

Sebi asks agencies to rate all firms
4 years, 6 months ago

Sebi asks agencies to rate all firms

Hindustan Times  

A representation from rating agencies which sought to withdraw ratings of companies who are not cooperating has met with resistance from the markets regulator, the Securities and Exchange Board of India. The regulations for credit rating agencies require that an instrument should be rated all through its lifetime and Sebi is unwilling to change the regulation as it could leave …

IL&FS scam: SEBI slaps Rs 25 lakh fine each on ICRA, CARE; flays rating agencies for failing to exercise due diligence
5 years ago

IL&FS scam: SEBI slaps Rs 25 lakh fine each on ICRA, CARE; flays rating agencies for failing to exercise due diligence

Firstpost  

The Securities and Exchange Board of India also said the default by IL&FS occurred due to “lethargic indifference and needless procrastination and laxity” of these rating agencies. New Delhi: Markets regulator SEBI on Thursday imposed a penalty of Rs 25 lakh each on rating agencies ICRA and CARE for failing to exercise “due diligence” while assigning credit rating to the …

Sebi floats tighter norms for full disclosure on loan defaults with rating agencies
5 years, 3 months ago

Sebi floats tighter norms for full disclosure on loan defaults with rating agencies

India TV News  

Markets regulator Sebi has come out with new norms that make it mandatory for companies to provide details on delayed loan repayments and possible defaults to credit rating agencies amid concerns over banks citing 'client confidentiality' to resist sharing of such information by their borrowers. The new framework would enable credit rating agencies to get timely information on possible defaults. …

Credit rating agencies face the prospect of further downgrades
5 years, 4 months ago

Credit rating agencies face the prospect of further downgrades

Live Mint  

Market downgrades have been dogging rating agency scrips. Lately, negative news has dominated the credit rating business, with the top management of two rating agencies asked to step down. The third CRA might have to comply with the regulations to separate rating and non-rating businesses, affecting stock performances,” said Elara Securities Pvt. For credit rating agencies, this poses significant challenges. …

SEBI board approves tighter norms for full disclosure on loan defaults with rating agencies
5 years, 4 months ago

SEBI board approves tighter norms for full disclosure on loan defaults with rating agencies

Firstpost  

Mumbai: Amid concerns over banks citing ‘client confidentiality’ to resist sharing of information on delayed loan repayments and possible defaults by their borrowers, capital market regulator SEBI on Wednesday announced new norms to make it mandatory for companies to provide these details to credit rating agencies. Amid numerous cases of huge loan defaults by corporates, including in cases like Infrastructure …

SEBI mulls slew of reforms; tighter check on rating agencies, reward and hotline for informants
5 years, 4 months ago

SEBI mulls slew of reforms; tighter check on rating agencies, reward and hotline for informants

Firstpost  

New Delhi: With an aim to further safeguard investors’ interests and to take defaulters to the task, capital market regulator SEBI is planning to unveil a slew of reforms, including for greater checks on credit rating agencies and for rewarding informants in insider trading cases with up to Rs 1 crore reward. The regulator is also planning to ease its …

Sebi mulls tighter norms to ensure full disclosure on loan defaults with rating
5 years, 5 months ago

Sebi mulls tighter norms to ensure full disclosure on loan defaults with rating

Live Mint  

New Delhi: Amid concerns over banks citing 'client confidentiality' to resist sharing of information on delayed loan repayments and possible defaults by their borrowers, capital market regulator Sebi is planning to tighten its norms to make it mandatory for companies to provide these details to credit rating agencies. Amid numerous cases of huge loan defaults by corporates, including in cases …

IL&FS case: SEBI widens investigation into role of rating agencies; looks into possible systemic lapses at all five rating agencies
5 years, 5 months ago

IL&FS case: SEBI widens investigation into role of rating agencies; looks into possible systemic lapses at all five rating agencies

Firstpost  

Grant Thornton said it identified multiple e-mails over the period from 2008 to 2018 which indicate that the IL&FS group was under stress or faced liquidity issues since 2015. New Delhi: Market regulator SEBI has expanded its probe into the role of five credit rating agencies after a forensic audit mandated by the new board of crisis-ridden IL&FS flagged serious …

Rating agencies, facing regulator's wrath for IL&FS tragedy, are left with a hard choice now
5 years, 5 months ago

Rating agencies, facing regulator's wrath for IL&FS tragedy, are left with a hard choice now

Firstpost  

In the Indian context, there are several examples where rating agencies failed to sense the imminent danger and continued awarding top ratings to firms in trouble only to witness payment defaults a few months later. Though the exact details aren’t known yet, it is understood that the investigation pertains to wrong rating calls given to the collapsed non-banking financial company, …

IL&FS fiasco: Sending ICRA executive on leave isn't enough; time regulator kicked off sweeping reforms for raters
5 years, 6 months ago

IL&FS fiasco: Sending ICRA executive on leave isn't enough; time regulator kicked off sweeping reforms for raters

Firstpost  

The international rating agency Moody’s Indian arm ICRA has done well to tick off its executive Naresh Takkar by sending him on leave pending an inquiry on the anonymous charge received by SEBI. The charge relates to top credit ratings given to IL&FS by a slew of credit rating agencies in India including ICRA. ICRA’s top brass must also be …

IL&FS case: Independent directors, rating agencies, auditors under Sebi lens
5 years, 6 months ago

IL&FS case: Independent directors, rating agencies, auditors under Sebi lens

Live Mint  

New Delhi: A large number of individuals and entities, including independent directors, top management personnel, rating agencies and auditors formerly associated with crisis-hit IL&FS may soon face action by capital market regulator Sebi for their role in the alleged fraud at the group. The matter is being probed by multiple agencies, including the Serious Fraud Investigation Office, which has also …

House panel raps rating agencies for not anticipating IL&FS situation
5 years, 11 months ago

House panel raps rating agencies for not anticipating IL&FS situation

Hindustan Times  

A parliamentary panel wants the finance ministry to spell out steps to make India’s credit rating agencies more accountable and transparent in the backdrop of the crisis at the highly rated finance firm Infrastructure Leasing & Financial Services. The panel wants the government to end the practice of agencies getting paid by the companies that want credit ratings, a business …

IL&FS crisis puts credit rating firms on SFIO radar
6 years, 2 months ago

IL&FS crisis puts credit rating firms on SFIO radar

Live Mint  

New Delhi: The Serious Fraud Investigation Office is looking into methods used by credit rating agencies as part of its probe into a series of defaults by Infrastructure Leasing and Financial Services Ltd. “SFIO is looking into the issue from the specific angle of how comprehensive they are,” Injeti Srinivas, secretary, ministry of corporate affairs, said on the sidelines of …

IL&FS crisis: Can the new Uday Kotak-led bailout panel provide the magic touch to debt-laden firm?
6 years, 3 months ago

IL&FS crisis: Can the new Uday Kotak-led bailout panel provide the magic touch to debt-laden firm?

Firstpost  

Any move by the government or the regulators to protect the interest of a large financial institution like IL&FS and to address the contingent effects of the episode is a welcome move as it will help in regaining the market confidence. The Infrastructure Leasing & Financial Services debt saga has entered a decisive phase with the government dissolving the IL&FS …

How credit rating agencies missed the IL&FS crisis
6 years, 3 months ago

How credit rating agencies missed the IL&FS crisis

Live Mint  

Mumbai: Indian authorities have spent the week containing the collateral damage from a major infrastructure lender struggling to service $12.6 billion in debt. “We have not had this kind of a systemic event of this magnitude in the bond market before in India, and so we don’t really have a precedent as to how to deal with it,” said Kunal …

How NBFCs found themselves in the middle of a storm
6 years, 3 months ago

How NBFCs found themselves in the middle of a storm

Live Mint  

What were the first signs of trouble? On 17 September, rating agency Icra downgraded IL&FS’s credit rating to default, after it failed to meet repayment obligations of ₹ 12,000 crore in short-term and long-term borrowings. The market panicked after news emerged that DSP Mutual Fund was selling DHFL’s one-year ₹ 300 crore paper at 11%. It was a liquidity crunch, …

IL&FS rot needs to be stopped from spreading
6 years, 3 months ago

IL&FS rot needs to be stopped from spreading

Live Mint  

A tad late, but the message is finally reaching India’s regulators: Infrastructure lender IL&FS is not a business that can be allowed to fail without consequences. Some of the group’s finance companies are now missing repayments on short-term paper, even as the unlisted parent’s owners, including state-run Life Insurance Corp. of India, dawdle over an emergency infusion of funds. The …

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