Title

Do solicitations matter in bank credit ratings? Results from a study of 72 countries

Document Type

Journal article

Source Publication

Journal of Money, Credit and Banking

Publication Date

3-1-2009

Volume

41

Issue

2-3

First Page

285

Last Page

314

Keywords

banks, credit rating, unsolicited, NRSROs

Abstract

Would the credit ratings of unsolicited banks be higher if they were solicited? Alternatively, would the credit ratings of solicited banks would be lower if they were unsolicited? To answer these questions, we use an endogenous regime-switching model and data from 460 commercial banks in 72 countries, excluding the United States, for the period 1998–2003. The answer to both questions is yes. Our results show that the observed differences between solicited and unsolicited ratings can be explained by both the solicitation status and financial profile of the banks. This finding is a new contribution to the literature.

DOI

10.1111/j.1538-4616.2009.00206.x

Print ISSN

00222879

E-ISSN

15384616

Publisher Statement

Copyright © 2009 The Ohio State University

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Full-text Version

Publisher’s Version

Recommended Citation

Poon, W. P. H., Lee, J., & Gup, B. E. (2009). Do solicitations matter in bank credit ratings? Results from a study of 72 countries. Journal of Money, Credit and Banking, 41(2-3), 285-314. doi: 10.1111/j.1538-4616.2009.00206.x