How wrong can a rating agency be?

You are looking to buy an item on Amazon. The first two reviews could not be more contrasting. One is a glowing five star rating. The other is a one star hatchet job. Which do you believe? This was akin to the situation facing investors considering Amazon’s new bond on Tuesday, with Moody’s opinion of the company four notches lower than that of S&P.

  • By Nigel Owen
  • 17 Aug 2017

S&P assigned a AA- rating to the online retailer in November 2012, based on an “expectation for strong cash flow generation and that business conditions will remain favourable for online retailers, with growth rates among the highest for the entire retail industry”.

Research house, CreditSights sees other ...

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All International Bonds

Rank Lead Manager Amount $m No of issues Share %
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1 Citi 313,852.39 1175 8.95%
2 JPMorgan 286,674.13 1305 8.17%
3 Bank of America Merrill Lynch 281,869.72 974 8.04%
4 Goldman Sachs 214,547.99 704 6.12%
5 Barclays 205,147.76 790 5.85%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
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1 Deutsche Bank 31,971.88 102 6.84%
2 HSBC 31,343.18 140 6.70%
3 Bank of America Merrill Lynch 28,468.55 82 6.09%
4 BNP Paribas 24,679.63 135 5.28%
5 SG Corporate & Investment Banking 22,195.55 122 4.75%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
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1 JPMorgan 15,956.24 68 8.20%
2 Morgan Stanley 15,028.69 75 7.73%
3 UBS 14,195.29 55 7.30%
4 Citi 13,827.82 85 7.11%
5 Goldman Sachs 11,994.74 65 6.17%