Fitch Ratings could set limits for the maximum credit ratings that can be awarded to complex debt products that are sensitive to changes in the market values of their underlying exposures, the agency said on Tuesday. The move would affect some of the deals that have been particularly hard hit by the sudden withdrawal of liquidity from debt markets over the second half of this year, such as structured investment vehicles and constant proportion debt obligations. Separately, rival ratings agency Moody’s on Tuesday said its downgrades to CDOs made up of pools of US mortgage-backed bonds and similar securities had totalled about $51bn over November. This means almost 10% of the entire market for such CDOs was downgraded in one month alone. At the end of November, $174.1bn worth of such deals remained on review for downgrade.

This entry was posted by Gwen Robinson on Wednesday, December 19th, 2007 at 5:22 and is filed under Capital markets. Tagged with fitch, Moodys. Edit this entry.