The new chief of Standard & Poor's on Thursday defended the ratings agency's downgrade of US and European bonds and denied his firm had grown more aggressive since the 2008 financial crisis. Doug Peterson, who took the helm in September, told the Wall Street Journal that his agency was justified in docking the US and French credit ratings from a sterling AAA to AA+.
"The team we have in sovereigns is a world-class team," Peterson said. The criteria for rating countries' debt, which were updated on June 30 - five weeks before the unprecedented US downgrade - "provide the core for how we do our analysis," he added. The updated criteria were again used last week, when S&P downgraded France's AAA rating to AA+, docked Italy by two notches to BBB+ and cut Spain two notches to A, part of a major overhaul of ratings across the eurozone.
S&P and rival ratings agencies Moody's and Fitch were widely accused of contributing to the 2008 financial crisis by giving top ratings to the risky mortgage bonds at the heart of the collapse. Peterson, a former Citigroup executive, insisted that S&P was not trying to be more strict than its competitors or to move markets with its analysis. "The value that we will bring is in having the right, very high-quality methodologies, analytics, people, training, intellectual property, publishing, etc," he said.