EDHEC: Do Multiple Credit Ratings Signal Complexity? Evidence From The European Triple-A Structured Finance Securities

The recent global financial crisis that began with the subprime mortgage problem in the United States in the summer of 2007 has called for a closer examination of market practices with respect to the use of ratings assigned to structured products assigned by credit rating agencies (CRAs). This has led to a well-established body of research in which two hypotheses feature prominently. The first is the “rating shopping” hypothesis, which asserts that underwriters of securities may shop for the