Dion Bongaerts publishes in the Journal of Finance

<link portal page _self>Dion Bongaerts’s paper “Tiebreaker: Certification and Multiple Credit Ratings”, co-authored with Martijn Cremers and William Goetzmann from Yale School of Management, has been conditionally accepted by the Journal of Finance. This paper investigates the reasons for debt issuers to apply for additional credit ratings. Most bonds are rated by both Moody’s and Standard and Poor’s, but only about 50% are rated by Fitch. Regulation classifies bonds according to the worse rating when two ratings are available and according to the median rating when three ratings are available. The authors find evidence suggesting that issuers request a third rating from Fitch to improve their regulatory classification or prevent it from deteriorating. In contrast, the authors find no support for alternative hypotheses like information production or rate shopping.