The parliamentary group of Morena in the Senate will present on Thursday March 7th, an initiative so that the National Banking and Securities Commission (CNBV) is obliged to revoke to the rating agencies statements, when their evaluations “intentionally attempt against financial stability“, announced MORENA Senator Salomón Jara this Wednesday March 6th.
The senator and spokesperson of his party explained that the proposal contemplates reforming article 340 of the Securities Market Law, which currently establishes that the CNBV, with the agreement of its Governing Board and previous hearing of the interested party, “may decree” the revocation of the authorization to organize and operate as a securities rating institution.
“We want to propose that from now on, Mexico’s CNBV has the faculty and the obligatory nature of decreeing the revocation of the authorization to organize, to operate as a rating agency, when these indications present evaluations or qualifications that do not adhere to the principles of independence, objectivity, rigor, authenticity, truthfulness, integrity and transparency or deliberately attempt against the financial stability of the national market or against any company or specific sector, “he said.
The Morena legislator pointed out that the intention is to establish the word “decree” the revocation instead of “may decree” the revocation.
In accordance with the current law, the CNBV “may decree” the revocation in the event that the rating agencies commit serious or repeated infractions to what is established in this law or the general provisions that emanate from it and / or are declared bankrupt , or, agree to their dissolution and liquidation.
The initiative will be presented in the Upper Chamber, after S&P downgraded the rating outlook for Mexico last week, which went from stable to negative, citing lower growth provisions. The rating agency also reduced the rating outlook for both Petróleos Mexicanos (Pemex) and the Federal Electricity Commission (CFE), from stable to negative as well.
On the other hand, the rating agency Fitch reduced the rating of Pemex’s debt in two steps in January, which went from ‘BBB+’ to ‘BBB-‘, placing it on the verge of losing the “investment grade”.
Source: The Yucatan Times with information from El Financiero