The SEC staff has issued a report to Congress on credit rating standardization required by Section 939(h)(1) of the Dodd-Frank Act. The SEC staff recommended that the SEC not take any further action at this time with respect to:
standardizing credit rating terminology, so that all credit rating agencies issue credit ratings using identical terms;
standardizing the market stress conditions under which ratings are evaluated;
requiring a quantitative correspondence between credit ratings and a range of default probabilities and loss expectations under standardized conditions of economic stress; and
standardizing credit rating terminology across asset classes, so that named ratings correspond to a standard range of default probabilities and expected losses independent of asset class and issuing entity.
Check dodd-frank.com frequently for updated information on the JOBS Act, the Dodd-Frank Act and other important securities law matters.