Standard & Poor's gets new chief executive after US downgrade

 

The head of the agency that stripped the US of its top-notch credit rating earlier this month is to step down in September.

Standard & Poor's president Deven Sharma will be replaced by Citibank's chief operating officer Douglas Peterson next month, the agency's parent, McGraw-Hill Companies, said. Mr Sharma, who has been in his current role since 2007, will leave McGraw-Hill at the end of the year.

The move comes after S&P analysts decided that US debt was no longer worthy of the highest "AAA" rating, although S&P said the two events were not connected. Recent weeks have also seen revelations regarding an investigation by the US Justice Department into the agency's ratings of complex mortgage securities that turned sour with astonishing speed during the credit crunch. For its part, S&P said that it has "received several requests from different Government agencies regarding US mortgage-related securities", and that it continued to cooperate with the requests.

The downgrade of US debt to "AA+" was criticised by the Obama administration, with officials claiming that the agency had gone ahead with the move despite admitting to a $2 trillion (£1.2trn) mathematical "error" in an early version of its decision.

The downgrade, which came in the wake of a rancorous political battle to raise the US debt ceiling, triggered stock market falls. However, it was not matched by the other large ratings agencies Fitch and Moody's. Moreover, in a sign that investors still view the country's debt as a safe haven, US Treasuries have attracted interest throughout the recent market turmoil, with yields falling to record lows.

Mr Peterson will take over on 12 September, with McGraw-Hill, which has come under pressure from shareholders to restructure its business, saying that Mr Sharma will stay on until the end of the year to work on a strategic review. "Doug is a seasoned executive with more than 25 years of global experience in financial services, risk management and capital markets," said the chairman and chief executive of the McGraw-Companies, Harold "Terry" McGraw III.

Mr Sharma said: "It has been a privilege to serve as the president of S&P and I am proud of what we as an organisation have achieved over the past four years. As McGraw-Hill continues its portfolio review, I will work closely with Terry and the leadership team to find ways to create even more shareholder value."

Shareholders in S&P's parent have been being calling for a break up of the group, which also owns the textbook publisher McGraw-Hill Education.

In a Securities and Exchange Commission filing this week, the hedge fund Jana Partners and the Ontario Teacher's Pension Fund, who together own 5.6 per cent of McGraw-Hill, also called on the company to "bolster" the ratings service with an "independent oversight figure" to help manage what they termed the "increasingly complex global regulatory landscape and improve dialogue with investors, regulators and the public".

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Arts and Entertainment
film
Arts and Entertainment
Preening: Johnny Depp in 'Mortdecai'
filmMortdecai becomes actor's fifth consecutive box office bomb
News
peopleWarning - contains a lot of swearing
Travel
travel
Arts and Entertainment
arts + ents
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Client Services Manager - Relationship Management - London

£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...

Recruitment Genius: Credit Controller / Customer Service

£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...

Guru Careers: In-House / Internal Recruiter

£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...

Recruitment Genius: Tax Assistant

Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...

Day In a Page

Syria crisis: Celebrities call on David Cameron to take more refugees as one young mother tells of torture by Assad regime

Celebrities call on David Cameron to take more Syrian refugees

One young mother tells of torture by Assad regime
The enemy within: People who hear voices in their heads are being encouraged to talk back – with promising results

The enemy within

People who hear voices in their heads are being encouraged to talk back
'In Auschwitz you got used to anything'

'In Auschwitz you got used to anything'

Survivors of the Nazi concentration camp remember its horror, 70 years on
Autumn/winter menswear 2015: The uniforms that make up modern life come to the fore

Autumn/winter menswear 2015

The uniforms that make up modern life come to the fore
'I'm gay, and plan to fight military homophobia'

'I'm gay, and plan to fight military homophobia'

Army general planning to come out
Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century
Homeless Veterans appeal: 'Really caring is a dangerous emotion in this kind of work'

Homeless Veterans appeal

As head of The Soldiers' Charity, Martin Rutledge has to temper compassion with realism. He tells Chris Green how his Army career prepared him
Wu-Tang Clan and The Sexual Objects offer fans a chance to own the only copies of their latest albums

Smash hit go under the hammer

It's nice to pick up a new record once in a while, but the purchasers of two latest releases can go a step further - by buying the only copy
Geeks who rocked the world: Documentary looks back at origins of the computer-games industry

The geeks who rocked the world

A new documentary looks back at origins of the computer-games industry
Belle & Sebastian interview: Stuart Murdoch reveals how the band is taking a new direction

Belle & Sebastian is taking a new direction

Twenty years ago, Belle & Sebastian was a fey indie band from Glasgow. It still is – except today, as prime mover Stuart Murdoch admits, it has a global cult following, from Hollywood to South Korea
America: Land of the free, home of the political dynasty

America: Land of the free, home of the political dynasty

These days in the US things are pretty much stuck where they are, both in politics and society at large, says Rupert Cornwell
A graphic history of US civil rights – in comic book form

A graphic history of US civil rights – in comic book form

A veteran of the Fifties campaigns is inspiring a new generation of activists
Winston Churchill: the enigma of a British hero

Winston Churchill: the enigma of a British hero

A C Benson called him 'a horrid little fellow', George Orwell would have shot him, but what a giant he seems now, says DJ Taylor
Growing mussels: Precious freshwater shellfish are thriving in a unique green project

Growing mussels

Precious freshwater shellfish are thriving in a unique green project