Rating agencies have come under greater scrutiny following their role in the 2008 financial crisis. They were criticized for exaggerating the ratings of risky mortgage-backed securities, giving false confidence to investors that they were safe for investing. Since then they have tried to take steps to improve their methodologies and transparency. By adopting Sigma’s software, Fitch will be able to expand how it evaluates lenders’ riskiness beyond the traditional credit profile.
“Regulators and investors are holding banks more and more accountable and Wirecard was a real wake-up call,” said Marjan van der Weijden, Fitch’s global head of financial institutions. “The extra information provided by Sigma’s dashboard [is] giving our analysts a tool to ask the right questions to executives and to pick up worrying trends earlier,” she added.