Federal agencies to issue risk management guidance-official

NEW YORK, March 5 (Reuters) - The U.S. Federal Reserve, the Securities and Exchange Commission and other agencies are set to issue broad risk management guidance on Thursday aimed in part at decreasing debt market reliance on credit rating agencies, an official said on Wednesday.

"You will see a piece in the release about what many consider an undue reliance on the credit rating agency rating," said Thomas Baxter, general counsel at the Federal Reserve Bank of New York.

Moody's Corp (MCO.N) and rivals such as McGraw-Hill Cos's (MHP.N) Standard & Poor's and Fimalac SA's (LBCP.PA) Fitch Ratings have come under criticism from regulators and investors for feeding the U.S. housing boom and subsequent bust by long assigning "triple-A" ratings to many risky securities, only to later downgrade those securities too fast.

The release will have a "suggestion that market participants do some of their own analysis with respect to offering material concerning particular securitizations, and certainly CDOs will rank up there," Baxter said at a Practising Law Institute conference in New York.

"There is a reason business people have come to rely on a credit rating," Baxter said. "It's a shorthand."

Baxter said the release would be about the "broad topic of risk management."

"There is going to be a lot of guidance," he said. (Reporting by Paritosh Bansal, editing by Maureen Bavdek)