In an attempt to further regulate the development of credit rating business, the People’s Bank of China (PBC) held a meeting on the development of the credit rating business on December 11, 2020. Pan Gongsheng, PBC Deputy Governor, presided over the meeting. Officials from relevant departments of the National Development and Reform Commission (NDRC), China Banking and Insurance Regulatory Commission (CBIRC), China Securities Regulatory Commission (CSRC) and the National Association of Financial Market Institutional Investors (NAFMII), as well as representatives of credit rating institutions, issuers and investors attended the meeting.
Attendees summarized the development and relevant challenges of the credit rating business in recent years, exchanged and drew on good practices of international rating institutions in business operations, and discussed the measures to further regulate the development of credit rating business in China.
Pan Gongsheng noted that credit rating, as an important fundamental institutional arrangement of the bond market, was of vital significance to the sound development of the capital market. In recent years, China’s credit rating business has made remarkable progress in unifying relevant rules, enhancing regulation and advancing opening-up. However, it still faces problems including inflated ratings, insufficient differentiation of issuers’ credit risks and weak early-warning functions, which have constrained the high-quality development of China’s bond market. The credit rating institutions shall carefully summarize the past experience and lessons, stay committed to professional ethics, strengthen the fulfillment of diligence and responsibility, enhance the capabilities of credit rating and improve the rating quality. Regulators, issuers and investors shall perform their respective duties and jointly contribute to the sound development of the credit rating business in China.
Pan Gongsheng stressed that the PBC would work with relevant authorities to jointly strengthen the supervision and regulation of credit rating business in the bond market, reinforce market discipline, promote advances in rating technologies, improve the rating quality, ensure better differentiation of issuers’ credit risks, further press ahead with unifying the regulation of credit rating, and truly give play to the role of credit rating institutions as the bond market “gatekeepers”, so as to facilitate the high-quality and sound development of the credit rating business.
