Moody’s said on Wednesday that it would withdraw domestic credit ratings
in Russia following “legislative changes and other potential
restrictions” that affect the business of providing national scale
ratings by its joint venture in the country, Moody’s Interfax Rating
Once ratings are withdrawn, the MIRA joint venture will close.
The decision from Moody’s marks the most drastic reaction so far to new
Russian regulation of credit rating agencies, but highlights the risk
that the country’s financial markets may become more isolated from
global markets amid the tit-for-tat fallout of western sanctions against
National-scale ratings assess the creditworthiness of issuers and
financial obligations within a country. Under legal amendments approved
last year that take effect in 2017, Moscow will allow agencies to issue
local ratings only through a subsidiary in the country that agrees to
certain conditions, including a guarantee not to withdraw ratings under
external political pressure.