Speech by SEC Chairman:
Statement at SEC Roundtable on Credit Rating Agencies

by

Chairman Mary L. Schapiro

U.S. Securities and Exchange Commission

Washington, D.C.
April 15, 2009

Good Morning.

Welcome to the Securities and Exchange Commission's Roundtable to examine the oversight of credit rating agencies. The Commission is truly grateful that so many have agreed to participate in today's meeting. We look forward to your comments, insights and recommendations.

As you all know, the SEC is the investor's advocate, and since I arrived here 10 weeks ago, I have focused singularly on how the SEC can best serve the needs of investors. And clearly, the role of credit rating agencies must be an area for our intense review as we think about how to promote investor protection and market integrity, and restore confidence in our financial system.

In late 2006, the Credit Rating Agency Reform Act gave the Commission the exclusive authority over rating agency registration and qualifications. In the less than three years since, the Commission has undertaken no fewer than five rulemakings. Clearly, the Commission has been very active in its efforts to fully implement the authority granted by Congress — all with an eye to providing the investing public with more confidence in the rating system.

These rules, which are all still relatively new, relate to a myriad of topics — ranging from registration and recordkeeping to disclosure and managing conflicts of interest. The last of these rules, some of which were adopted this past December and some which are still pending, were significantly influenced by the findings of the SEC's extensive 10-month examination of three major credit rating agencies.

But as much as we have done, there is still more to do. The status quo isn't good enough. Rating agency performance in the area of mortgage-backed securities backed by residential subprime loans, and the collateralized debt obligations linked to such securities has shaken investor confidence to its core.

Our purpose today is to ask some very basic questions:

We are very fortunate to have with us today a number of panelists who will help us find answers to these and other questions. The first panel will help us understand what the rating agencies themselves are doing to address the problems. The second panel will discuss competition issues, both domestically and from a global perspective. The third panel will provide the views of different types of users. And the fourth panel will primarily focus on identifying possible new approaches to oversight.

I'll now turn the meeting over to Dan Gallagher, Deputy Director of the Division of Trading and Markets, who will introduce and moderate our first panel.