Officials follow US steps on ratings

PUBLISHED : Thursday, 27 June, 2002, 12:00am
UPDATED : Thursday, 27 June, 2002, 12:00am

Hong Kong might follow the lead of the United States and other countries in increasing regulation of credit rating agencies.

Secretary for Financial Services Stephen Ip Shu-kwan told legislators yesterday the Government was closely watching moves by overseas regulators.

'The International Organisation of Securities Commissions is considering the regulation of credit rating agencies in view of their significant influence on the financial market,' Mr Ip said.

In the US, rating agencies are registered as investment advisers with the Securities and Exchange Commission. But Mr Ip said such registration did not directly address the quality or reliability of their ratings, nor the timing of their releases of information.

'We will closely monitor international developments to ensure that Hong Kong's regulatory regime is on par with international standards and best practices,' Mr Ip said.

Mr Ip said the Government did not want to set up local credit rating agencies but would encourage the private sector to do so. 'The involvement of the Government may affect the credit rating agencies in building up their independence and the credibility of their ratings,' he said.