Roland Stoever's Palm Beach Post Weekly Column: MUNICIPAL BOND RATINGS SIMPLIFIED: Part 2

Monday, May 1, 2017

Roland Stoever
Stoever Glass & Co., Inc.
P: (800) 223-3881
E: roland@stoeverglass.com

Bond ratings begin with a request from the issuer.   The issuer must pay a fee to obtain a rating.  That is why ratings are not automatic.  In addition, if an issuer sells more bonds without a rating, the rating will generally be withdrawn.

The rating process is strong, but not perfect.  When I was Chief Municipal Rating Officer at S&P, rating teams had two people assigned, with one senior person assigned to the rating.  Only senior analysts with experience can vote; the junior analyst may make recommendations, but their vote doesn’t count.

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