Details
🕵️ Inspectors on the case: Beijing’s securities watchdog criticized S&P China for weak disclosure and inconsistent standards, pointing out loopholes instead of clear rules.
📉 AAA overload: In China, almost all corporate bonds receive top marks — recently, over 90% of new bonds were rated AAA. Regulators fear the grade is losing its meaning.
🛡️ S&P backtracks: The agency said it would tighten procedures and align more closely with local rules to restore trust.
💸 Cheap but risky: Many agencies lured issuers with low fees and “friendly” ratings. Several were fined millions, including China Bond Rating and Golden Credit Rating.
Big Picture
The regulator wants to restore trust in China’s bond markets and rein in the flood of top grades. Issuers with weaker credit may face higher borrowing costs, while strong names stand to benefit. For international rating agencies, the balancing act continues: uphold global standards while complying with China’s stricter local rules.
The China Survival Guide for Western Businesses
Entity setup, WeChat strategy, hiring your first local team. 12+ years on the ground in Shanghai.
