LONDON (Reuters) – Credit ratings agency Moody’s <MCO.N> is converting its Stockholm branch into a subsidiary as the sector faces regulatory pressure to have enough staff in the European Union post Brexit.
Moody’s, one of the “Big Three” global agencies along with Standard & Poor’s <SPGI.N> and Fitch, has hitherto run a large chunk of its European operations from a base in London, but Britain is due to leave the EU next March.
“The registration of our credit rating agency in Sweden reflects the importance of the Nordics as a strategic region for Moody’s,” a Moody’s spokeswoman said on Monday.
“This will enhance our service and support to the debt capital markets across the EU.”
Under EU rules, credit ratings for customers in the bloc can only be issued by agencies registered with the European Union’s European Securities and Markets Authority (ESMA).
ESMA said it has “registered” Moody’s Stockholm branch, meaning it will become a fully fledged operation.
“Moody’s Investors Service (Nordics) AB is based in Sweden and intends to issue sovereign and public finance ratings, structured finance ratings and corporate ratings,” ESMA said.
ESMA data shows Moody’s has an EU market share of 31 percent, behind S&P’s 46 percent.
The EU watchdog said last year that rating agencies that have their main European offices in London may have to move significant numbers of staff to other parts of the EU in time for Brexit.
S&P has said it would make a new Dublin office its post-Brexit EU headquarters. Moody’s already has operations in Frankfurt.
(Reporting by Huw Jones, editing by Alexander Smith)