U.S. Securities and Exchange Commission publishes annual staff report on NRSRO examinations and industry issues

The U.S. Securities and Exchange Commission’s Office of Credit Ratings published its annual staff report on nationally recognized statistical rating organizations, summarising findings from NRSRO examinations and discussing competition, transparency and conflicts of interest in the credit rating market. The 2024 examination programme covered the eight statutory review areas and focused on firm-specific industry risks, including how NRSROs determine whether rating methodologies remain appropriately designed as conditions evolve, surveillance practices and compliance with statutory and rule requirements such as maintaining an effective internal control structure, commercial real estate-related rating activity and adherence to methodologies and surveillance requirements, and employee and director securities ownership policies intended to address related conflicts of interest. The Office of Credit Ratings uses the examinations to promote compliance with applicable federal securities laws and rules and reports its findings to Congress and the public through the annual staff report.