99 3.5 Rating discrepancy between Moody’s and S&P Idne soi gr dn eorn t toh eg aniunmf ub re trhoefr r ua tni nd ge rs sdt ai sncdl oi ns ge do, fwteh eex ar oml ei n eo fwchoemt hpel er xi istsyu eorf s ad eCaLl iOn’ gs with CRAs in disagreement, i.e., when there is a discrepancy in ratings (in such a circumstance the ratings are often called ‘split’), are more likely to disclose bd oe st hc r irbaet idn gi ns fHoyr pCoLt hOess itsh aHt 3a. rRea mt i nogr ed icsocmr epplaenx c tyh ab ne t wf oer e lne sMs ocoodmyp’ sl eaxn dC LSO&sP, ai ss mF oeraes xuar me dp bl ey, it fh ae sneucmu rbi et yr oi sf rnaot tecdh Ae sa ad ibf fye rMe on oc ed yb’ es tawnede nA Ae +a cbhyr Sa &t i nP,gwa et icsasluc aunl actee. rt ha tei nn gu md iesrcirceapl avna cl uyeboyf Ss u&bPt’rsarcatti inngg t(h2e) , nr ue smuel triinc ga li nv ar laut ei nogf dMi soc or edpya’ sn rc ay toi nf g1 .( 1 ) b y 31 Vice vneort sc ah, di fi ft fheer es ne cc ue .r Ii tny tiost raal ,t ei nd oAuArAa nb ya l Sy &s i Ps wa nedi nAcal 1u dbey 5M6o7oCdLy O’ s s, wwei tahl ssop lriet pr oa tritnogns e. Figure 3.2(a) presents a scatter-plot of the rating discrepancy in notches difference br aettiwn ge edni sMc roeopdayn’ sc ya nf ldu cSt&u Pa ,t esso rat ce rdo sbsy ti isms uea na cned yiet a irs. Tmh oe sfti gpurroeniol luunsct readt eisn t ht haet pf reerqi ou de nbt el yt wd ei secnl o2s0e 0d 4s pt ol i 2t 0r a0t9i n. Wg s hwa ti twh ea nc or et idc iet irsa tt hi nagt idni ftfhe irse np ce er i oo fd oi snseu ne or st cmh .oIsnt tahned pweirtiho da laof wt eer r2a0m0 9o u, wn teoof bnsoetrcvhee sa ddirf af emr eant iccea. l Fl yi gl uo wr ee3r . 2n (ubm) bper re soefnst ps lai t srcaattitnegrs- pwl ho et roef tMh oe oCdLyO’ ss awn oduSl d& Pf a bl l yi fntuhme bCeRrAosf wn oo tuclhde hs advi ef f eg ri ve ennc ei .dTe hn et i c4a5l - cdreegdriet er al itni ne gi ss to the CLOs at the time of their issuance. 31( w n h W e i g c e a h t c i a o v r n e e ) d n u v o a c t t l ue r d e e s p s o i i f m r t t i h e la d e r i n n r u e t m g h r e i e s r s i ps c a i a o p l n e v r a a . l n R u a e e l s y o u s f e l t M s s w o ar o i e t d h y a p v ’s a o r i s l a i a t t b i i v n le e g u a is n p d o h n i n g r e h e g e q a r u t ( i e v lo s e t w . v ea rl u) et sh af onr Sr&a tPi. nWg ed ios bc rt ae ipnaendc ys ,i mw ii ltahr proe ss iut li tvse, Chapter 3 - Security Design and Credit Rating Risk
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