Standard & Poor's Reports Progress on Efforts to Enhance Ratings and Transparency

Standard & Poor's Reports Progress on Efforts to Enhance Ratings and
Transparency

NEW YORK, April 10 /PRNewswire/ -- Standard & Poor's Ratings Services
("S&P") today provided an update on the ratings and transparency enhancements
it announced on February 7, 2008. Today's update is the first in a series of
ongoing progress reports S&P intends to provide on these initiatives.
"We have made significant progress in implementing the actions we
announced in February, which are designed to enhance independence, strengthen
the ratings process and increase transparency," said Deven Sharma, president
of S&P. "We view this as a substantive first step and look forward to
continuing to engage with market participants and policymakers as we implement
our enhancements and consider additional measures. We are committed to
helping bring stability and transparency to the capital markets and believe
our actions will help build greater confidence in credit ratings."
Some of the key actions that already have been completed include:
-- Adding requirements for additional loan level data from issuers for new
RMBS deals
-- The formation of a Risk Oversight Committee
-- Instituting an analyst rotation program

"At the core of these actions is our commitment to significantly enhance
transparency, both in the marketplace and in what we do and how we do it, so
market participants can make their own judgments about our rating opinions."
Progress Update:
Below are progress updates on each of the major categories of S&P's
actions to enhance its ratings and transparency:
Analytics: S&P is taking steps to ensure that its ratings models,
processes, and analytical talent continue to be of the highest quality and
that S&P remains fully equipped to rate complex financial structures with
increasing transparency regarding assumptions. These actions include:
-- The hiring of a Director of Model Quality and additional team members
-- Incorporating additional loan level data into our Structured Finance
(SF) surveillance function
-- Increasing analyst training requirements by 25% and working to select a
provider to facilitate the implementation of an analyst certification
program
-- Developing a request for comment on non-default risks (including
volatility, liquidity, recovery and correlation)

Governance: S&P is implementing measures that build on existing governance
policies and protections and further strengthen the integrity of the ratings
process to ensure its independence, to make the effectiveness of our
governance even more transparent and to maintain investor confidence. These
actions include establishing:
-- The Office of the Ombudsman - we have begun a search for candidates and
will appoint the Ombudsman by year-end
-- An Enterprise Risk Oversight function and committee
-- A rotation policy for lead analysts
-- A framework for conducting "look back" reviews on analysts who leave
S&P to work for issuers or financial advisors
-- A Policy Governance Group to develop and approve all new Ratings
Services' policies and procedures
-- Periodic reviews with the McGraw-Hill Board's Audit Committee to
address S&P Ratings' governance and compliance function

Information: S&P is providing greater transparency about its ratings
process and greater clarity about the risks that could cause rating
assumptions to change. These actions include:
-- S&P's March 25, 2008 announcement that issuers must provide S&P with
additional, updated loan level data on a monthly basis on transactions
closing after May 1, 2008
-- Developing a new section in S&P's initial rating reports that
incorporates sensitivity analysis on a deal by deal basis
-- A revamped criteria for assigning overall originator rankings based on
operational process and procedures

Education: S&P is undertaking an extensive outreach program to help market
participants better understand what a credit rating is -- and is not. The goal
is to help them use ratings appropriately. These actions include:
-- Participating with other NRSROs on a new working group whose goal is
the introduction of industry-wide best practices for ratings agencies
and other matters of regulatory concern
-- Working with the American Securitization Forum to establish best
practices for disclosure in securitizations
-- Formalizing the charter for, and identifying members of, S&P's new
Advisory Council
-- We will continue to publish data and articles on the subject of ratings
comparability

Full Progress Report of S&P's Ratings Leadership Actions

Details of Standard & Poor's progress on all 27 actions are available at
http://www.spnewactions.com/ .
About Standard & Poor's
Standard & Poor's, a division of The McGraw-Hill Companies (NYSE: MHP), is
the world's foremost provider of financial market intelligence, including
independent credit ratings, indices, risk evaluation, investment research, and
data. With approximately 8,500 employees (including wholly owned affiliates)
located in 21 countries, Standard & Poor's is an essential part of the world's
financial infrastructure and has played a leading role for more than 140 years
in providing investors with the independent benchmarks they need to feel more
confident about their investment and financial decisions. For more
information, visit http://www.standardandpoors.com .
SOURCE Standard & Poor's

Ed Sweeney +1-212-438-6634 - office +1-917-903-4129 - mobile
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