Morningstar DBRS

Last updated
Morningstar DBRS
Company type Subsidiary
Industry
PredecessorDBRS, Dominion Bond Rating Service
Founded1976;48 years ago (1976)
FounderWalter Schroeder
Products
  • Credit ratings
  • Financial research
Parent Morningstar, Inc.
Divisions
  • DBRS Limited
  • DBRS, Inc.
  • DBRS Ratings Limited
  • DBRS Ratings GmbH
  • DBRS Ratings GmbH
  • Sucursal en España
Website dbrs.morningstar.com

Morningstar DBRS is a global credit rating agency with offices in Toronto, New York, Chicago, London, Frankfurt and Madrid. Morningstar DBRS provides independent credit rating services for financial institutions, corporate and sovereign entities and structured finance products and instruments. It was originally founded as Dominion Bond Rating Service in Toronto in 1976, and its operations were integrated with Morningstar Credit Ratings to form Morningstar DBRS after its acquisition by the global financial services firm Morningstar, Inc. in 2019. [1] [2] It is the largest rating agency in Canada.

Contents

Morningstar DBRS is the fourth-largest credit rating agency by global market share, with between 2% and 3% of global market share. [3] The company is one of only four CRAs, including Standard & Poor's, Moody's Investors Service, and Fitch Ratings, to be recognized as an external credit assessment institution by the European Central Bank (ECB). [4] In recent years, Morningstar DBRS' sovereign ratings on European nations, including Portugal, Ireland and Italy, were used by the ECB for such purposes. [5]

History

The company was founded by Walter Schroeder, who started the company in a small office in Toronto with less than $1,000. [6] Schroeder and his family later sold the company to The Carlyle Group and Warburg Pincus. [7]

DBRS opened offices in Chicago and New York in 2003. After changing its name from Dominion Bond Rating Service to DBRS in 2008, the organization opened its current office in London in 2010, an office in Frankfurt in 2018, [8] and an office in Madrid in 2019. [9]

On May 29, 2019, Morningstar, Inc. announced their acquisition of DBRS in an approximately $700 million cash and stock transaction. [10] The takeover closed on July 2, 2019. [11]

Corporate structure and regulation

DBRS Limited is the operating company in Canada. DBRS, Inc. is the operating company in the United States. DBRS Ratings Limited is the operating entity based in London and is home to the agency's broader European operations. DBRS Ratings GmbH is the German operating unit and DBRS Ratings GmbH, Sucursal en España is the operating company in Spain.

In Canada, Morningstar DBRS is regulated through the Canadian Securities Administrators and its principal regulator is the OSC. [12] In the United States, Morningstar DBRS is regulated by the Securities and Exchange Commission. In Europe, Morningstar DBRS is regulated by ESMA and the FCA. [13]

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References

  1. ↑ Banerji, Gunjan (29 May 2019). "Morningstar Looks to Expand Ratings Business with DBRS Deal". Wall Street Journal.
  2. ↑ "Morningstar DBRS".
  3. ↑ Martin, Timothy W. (2015-03-02). "Carlyle, Warburg to Go After Big Three Ratings Firms With DBRS Purchase". Wall Street Journal. ISSN   0099-9660 . Retrieved 2018-03-19.
  4. ↑ "External Credit Assessment Institutions (ECAI) - European Banking Authority". www.eba.europa.eu. Archived from the original on 2018-08-15. Retrieved 2018-03-19.
  5. ↑ Wise, Peter (2017-04-21). "Portugal retains investment-grade rating at DBRS" . Financial Times. Archived from the original on 2022-12-11. Retrieved 2018-03-19.
  6. ↑ "Is DBRS right on Europe?" . Retrieved 2018-03-19.
  7. ↑ "The Carlyle Group and Warburg Pincus to Acquire DBRS | The Carlyle Group". www.carlyle.com. Archived from the original on 2018-07-18. Retrieved 2018-03-19.
  8. ↑ Jones, Marc. "Rating firm DBRS picks Frankfurt as post-Brexit EU base". Reuters. Reuters. Retrieved 2019-01-24.
  9. ↑ "Madrid Opening Marks DBRS's Third Office in Europe". DBRS.com. Retrieved 2019-01-24.
  10. ↑ "Morningstar Buys Ratings Agency DBRS". 29 May 2019.
  11. ↑ "Morningstar Names Detlef Scholz President of Expanded Credit Ratings Organization".
  12. ↑ "Canada to impose code of conduct on debt raters" . Retrieved 2018-03-19.
  13. ↑ Bernard, Stephen L. (2012-10-09). "DBRS Pitches Increased Competition for Rating European Debt". Wall Street Journal. ISSN   0099-9660 . Retrieved 2018-03-19.
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