Credit Rating Agencies—NRSROs

A credit rating agency is a firm that provides its opinion on the creditworthiness of an entity and the financial obligations (such as, bonds, preferred stock, and commercial paper) issued by an entity. Generally, credit ratings distinguish between investment grade and non-investment grade. For example, a credit rating agency may assign a "triple A" credit rating as its top "investment grade" rating for corporate bonds and a "double B" credit rating or below for "non-investment grade" or "high-yield" corporate bonds.

Some credit rating agencies whose credit ratings are used under the SEC's regulations are known as "Nationally Recognized Statistical Rating Organizations" or "NRSROs." There are currently four NRSROs — Dominion Bond Rating Service Ltd., Fitch, Inc., Moody's Investors Service, and the Standard & Poor's Division of the McGraw Hill Companies Inc.

To learn more about NRSROs, please visit the Division of Market Regulation's webpage on Credit Rating Agencies.  There you can find a variety of background materials, including concept releases, a special study, testimony, transcripts of hearings, and selected No-Action letters by SEC staff.