Lehman Brothers' decision to include Fitch Ratings in its global indices could spark a flurry of ratings shopping among issuers and may even drive borrowing costs lower for issuers, said buy- and sell-side fixed-income players. "Companies are going to go after the third rating, especially if Fitch doesn't rate as aggressively; it could mean lower borrowing costs. It is what's making everyone so excited," said one sell-sider at a bulge-bracket firm. He speculated Fitch will likely charge issuers more because its ratings now have more clout.
Nancy Stroker, group managing director in corporate finance at Fitch, said she is aware of the agency's reputation as potential rating inflator, but dismissed that notion's merit. "The perception is an old one, from when we used to rate companies only if they requested the rating," she stated, noting Fitch began covering companies at the prompting of investors, and not just issuers, about two years ago.
