Nationally Recognized Statistical Rating Organizations

Nationally Recognized Statistical Rating Organizations (NRSROs) are official agencies approved by the U.S. Securities and Exchange Commission (SEC) to evaluate the creditworthiness of securities and financial institutions. They analyze the likelihood that borrowers will repay their debts, providing ratings that help investors assess risk. These ratings influence investment decisions, interest rates, and regulatory requirements. Examples include Moody’s, Standard & Poor’s, and Fitch. NRSROs play a crucial role in maintaining transparency and stability in financial markets by offering reliable, standardized assessments of credit risk.