QCOSTARICA BUSINESS – Fitch Takes Rating Actions on Costa Rican Private Banks Following Peer Review
Following its peer review of the three largest Costa Rican private banks, Fitch Ratings took rating actions on the following entities:
–Banco BAC San Jose, S.A.;
–Scotiabank de Costa Rica, S.A.;
–Banco Davivienda (Costa Rica), S.A.
Fitch has published Rating Action Commentaries (RACs) for each of these banks, which are available on www.fitchratings.com and www.fitchcentroamerica.com. These RACs include each issuer’s key rating drivers and sensitivities, as well as the list of all rating actions taken.
Source: Reuters
Remember the 2007-10 subprime financial meltdown? Fitch was one of the three rating agencies that enabled billions of dollars worth of the uber-risky CDOs to be sold. Their inflated ratings misled investors and masked the underlying flaws in those packaged obligations. They had a conflicting financial interest in rating them highly. Some rule changes were implemented post-crash to prevent this recurring in the States (far too few, in my opinion) but I cannot find any such regulation change or increased oversight in Centro/South America. Buyer beware. Google “credit rating agencies and the subprime crisis” for more.