PARIS (Reuters) - A European Union plan to impose tougher rules on credit rating agencies is “dangerous” as it is bound to limit the “quality and independence” of the rating process, the president and chief operating officer of Moody’s Investor Services told Le Figaro newspaper.
“I see it as reflecting an obsession to challenge the rating process itself, and to hold rating agencies responsible for the European debt crisis,” Michel Madelain said in an interview.
“These proposals cannot make investors confident again nor facilitate the access of companies and European states to credit markets,” he added.
The European Union on Tuesday unveiled plans to shake up credit rating agencies, although it shelved for now a divisive move for temporary “blackouts” on some sovereign ratings.
EU financial services chief Michel Barnier said his draft law would inject competition into a sector dominated by three companies, Moody’s Standard & Poor’s and Fitch Ratings who warned the rules would leave investors with less choice.
Many EU policymakers want tougher rules for the sector, saying a ratings downgrade of Greek sovereign debt last year made it more expensive to mount the country’s first bailout.
Reporting by Dominique Vidalon; Editing by Erica Billingham