Classification agencies in a general fight on private credit grades

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The American credit classification agent has become involved in a rare general dispute over the reliability of the grades of the increasing insurance companies of private credit investments.

The conflict includes a study, since its withdrawal by its publisher, allegedly find that small credit rating agencies allocate more generous degrees to private credit investments more than the largest and most firmly established. The Kroll Classification Agency has accused Fitch categories with the misleading participants in the market by relying on the study to raise doubts about the quality of its evaluation.

Vic On Monday, a report criticized Kroll and other groups, based on a 2024 study, issued by the National Insurance Commission.

A Fitch spokesman stood in addition to its report, on the pretext that the Insurance Commission Commission group has reached similar conclusions in previous studies. “If (the association) provides new information, we will update our analysis.”

The unusual public tree highlights intense competition in 1.6 trillion dollars, growth and profitable Private credit The industry that should bend the grass – not only between the lenders, but among the collections paid for the ruling of the credit merit of the unusual investment offers in the market.

“There is an accumulation of risks in the insurance industry and perhaps also in the guaranteed loan sector that is not properly monitored,” Anne Routland, former analyst at Moody’s, and CEO now told the classification agency. “Opinion and risks are attributed to the fact that there are cracks in the basis of the credit rating that regulates the current SEC.”

Insurance companies and other investors use the types of assessments concerned, known as private messaging classifications, when general classifications are not available. Historically, large classifications companies avoided issuing these types of grades for private credit products, leaving the market dominated by smaller agencies.

“There is a challenge in assessing credit quality from abroad because there is no part of the process, analysis or information” there is a challenge in assessing credit quality from abroad because there is no part of the process, information or information “there is a challenge in assessing credit quality from abroad because there is no part of the process, information or transparency information from abroad.”

Krol, who was among the first to be stabbed in the institution’s credit agencies with its launch after the global financial crisis, said it was turbulent by strengthening its largest rival for “non -statistical” research. She said Fitch’s criticism seemed directed at supporting the seizure of hegemony.

“By searching for the importance of increasing its market share in private credit, Fitch has been undermined basic principles for any classification agency – integrity and analytical accuracy,” Kroll said in a statement.

The NAIC study focused on the rise of private messaging evaluations for private credit investments for insurance companies, which total about 350 billion dollars at the end of 2023.

I found that the degrees issued by the secrecy of the smaller classification stores were more likely to deviate from the grades by the Assembly Securities Assessment Office and were significantly higher on average. according to The original reportSmaller groups such as Kroll tend to provide three -score classifications higher than the association’s internal result, while large agencies such as Fitch showed about two cracks.

The study also showed that the number of securities that were classified from the private sector kept by American insurance companies grew from 2850 in 2019 to 8152 in 2023, and that the share of the securities that were classified by small credit classification providers such as Ighan Jones, Crullus, and Worth Star grew to 86 percent in 2023.

The report also indicated that Fitch is the pioneering provider of special messages assessments between major American classification agencies, before the global S&P classifications and MOODY classifications.

But earlier this month, Insurance Association Declare The report was removed from his website to “submit to more editing work to clarify the submitted analysis.”

Without naming names, the Insurance Association said it “will evaluate how to misunderstand the information we provide to the public or use it in an inappropriate manner.”

NAIC refused to request a comment.