Big Three (credit rating agencies)

Big Three credit rating agencies are S&P, Moody's, and Fitch. S&P and Moody's are based in the Manhattan, while Fitch is dual-headquartered in Manhattan and London, and is controlled by Hearst. As of 2013 these credit rating agencies hold a collective global market share of "roughly 95 percent"[1] with Moody's and S&P's having approximately 40% each, and Fitch around 15%.[2]

According to an analysis by Deutsche Welle, "their special status has been cemented by law — at first only in the United States, but then in Europe as well."[1][3] From the mid-1990s until early 2003, the Big Three were the only "Nationally Recognized Statistical Rating Organizations (NRSROs)" in the United States — a designation meaning they were used by the US government in several regulatory areas. (Four other NRSROs merged with Fitch in the 1990s.)[4] The European Union has considered setting up a state-supported EU-based agency.[5]

The Asian credit rating market is relatively diverse. Due to the regulation by the Chinese central government, the Big Three penetration into the domestic market especially in China is considered less competitive than the local well-recognized agencies, namely China Chengxin International (CCXI), China Lianhe Credit Rating (Lianhe Ratings), Dagong Global Credit Rating, and Pengyuan Credit Rating. In the Indian subcontinent, three out of the six registered credit rating agencies are subsidiaries of the big three – including CRISIL (S&P), ICRA Limited (Moody's) and India Ratings (Fitch).

Influence

Recent downgrades

In August 2011, S&P downgraded the long-held triple-A rating of US securities.[9] On August 1, 2023, Fitch downgraded its credit-rating of United States Treasuries from AAA to AA+, as S&P had twelve years earlier. On May 16, 2025, Moody's downgraded its United States long-term issuer and senior unsecured ratings to Aa1 from Aaa.[10]

In December 2024, Moody's downgraded France's rating to Aa3, citing political fragmentation and weak public finances.[11] This trend continued in October 2025, when both Fitch and S&P lowered France's sovereign rating to A+.[12] Major emerging economies also faced pressure; in April 2025, Fitch downgraded China's credit rating to A from A+, highlighting concerns over rising public debt.[13]

Overreliance on the Big Three

A common criticism of the Big Three, and one that was highly linked to bank failure in the 2008 recession, is the dominance the agencies had on the market. As the three agencies held 95% of the market share, there was very little room for competition. Many feel this was a crucial contributor to the toxic debt-instrument environment that led to the financial downturn. In a preliminary exchange of views in the European Parliament Committee on Economic and Monetary Affairs, held in late 2011, it was advocated that more competition should exist amongst rating agencies. The belief was that this would diminish conflicts of interest and create more transparent criteria for rating sovereign debt.

There are over 100 national and regional rating agencies which could issue ratings if they can build up their credibility by meeting the conditions for being registered by European Securities and Markets Authority (ESMA). They could also use data from the European Central Bank and the International Monetary Fund to help with their analyses. Reliance on the "Big Three" could also be reduced by big companies assessing themselves, MEPs added.[14]

In November 2013, credit ratings organizations from five countries (CPR of Portugal, CARE Rating of India, GCR of South Africa, MARC of Malaysia, and SR Rating of Brazil) joint ventured to launch ARC Ratings, a new global agency touted as an alternative to the "Big Three".[15]