A Closer Look at Credt Rating Processes: Uncovering the Impact of Analyst Rotation
Kilian R. Dinkelaker (),
Andreas-Walter Mattig () and
No 1911, Working Papers on Finance from University of St. Gallen, School of Finance
We investigate the effect of credit analyst rotation in the context of long-term ratings of S&P 500 issuers between 2002 and 2015. We find that analyst rotation in the coverage of issuers is associated with higher rating activity and a lower credit risk assessment (e.g., rating downgrades) following the appointment of a new credit analyst. Our results provide empirical support for policies relating to mandatory credit analyst rotation programs.
Keywords: Rating agencies; credit ratings; credit analysts; rotation policy; analyst bias (search for similar items in EconPapers)
JEL-codes: G14 G24 G28 (search for similar items in EconPapers)
Pages: 41 pages
New Economics Papers: this item is included in nep-rmg
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Persistent link: https://EconPapers.repec.org/RePEc:usg:sfwpfi:2019:11
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