Finance companies disappointed with Rapid Ratings' departure
After four years trying to build up a business out of providing finance companies with both quantitative and qualitative credit ratings, Rapid Ratings has decided to pull out of that segment of the market.
Thursday, 9 February 2006
by Jenny Ruth
Rapid Ratings charged $25,000 per rating and Keene says his company spent a minimum of 125 hours analysing each company including non-public data and interviews with all the key executives and would produce comprehensive reports of between 70 and 100 pages.
Keene says about 14 companies had been rated over the four years.
A big problem for Rapid Ratings is that New Zealand lacks a strong ratings culture, he says. "You need the investors and financial planners providing a strong push on finance companies to be rated in order to attract investment."
But New Zealand investors seem interested only in chasing the highest interest rates available rather than being interested in how safe their investments are, he says.
Strategic Finance was the first company to be rated and after its fourth rating maintained its B1 investment grade rating, the highest awarded.
"We're a little disappointed" at Rapid Ratings' withdrawal, Strategic chief executive Kerry Finnigan says. Having a rating helped investors differentiate between finance companies. "It gave investors the confidence that all our internal processes and procedures and compliance was second to none."
Strategic's current rating expires in November, in the meantime the company will look at being rated by another ratings agency, probably either S&P or Fitch Ratings.
St Laurence Mortgages has a B3 rating which expires in October. "We were quite disappointed with their decision," says chief executive Paul Chapman.
"We got on the ratings train reasonably early. We saw it as a strategic move for the company." St Laurence will also consider an alternative rating, he says.
Commenting is closed
Weekly Updates including news and commentary
Today's Best Bank Rates
Today's Top 5 Deposit Rates
Find a Rate
Cash PIE Rates
3 July 2017
21 June 2017
6 June 2017
4 May 2017
10 April 2017
Disclaimer - Every possible effort has been made to keep the information in the tables and on this site as accurate as possible, however, neither the publisher, Tarawera Publishing, nor anyone engaged to compile the rates and this site accept any liability for inaccuracies or any loss suffered as a result. It is strongly advised that readers check loan details with providers. The full terms and conditions of this site can be found here.
© Copyright 1997-2021. Tarawera Publishing Ltd. All Rights Reserved.