The Superintendency of Securities is working on a proposal that would make mandatory to have a risk rating on each debt issuance registered in the Panamanian market.

The initiative put forward by the authorities of the Panamanian stock market comes days after the collapse of the Panamanian RG Hotels Company, which in 2012 issued bonds with unrated debt risk, leaving investors who bought these securities unprotected.

“… The market regulator hopes that in the first quarter of 2016 the agreement will come into force, which must first be approved by the board of the SMV and undergo a public consultation process. Superintendent Melissa Quintero foresees that ‘sectors will disagree’. She recalled that banks are required to have a rating, which currently is now seen as normal but once generated suspicion. ”

The Superintendency expects to finish defining the specifications of the legislation once it has been submitted for public consultation. In this way a decision will be made as to whether the requirement would apply to for emissions in the same way or depending on the type of issue and the characteristics of the issuer.

Source: Prensa.com