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Credit ratings would help to identify failing foundation trusts early, says Monitor

BMJ 2012; 344 doi: http://dx.doi.org/10.1136/bmj.e555 (Published 23 January 2012) Cite this as: BMJ 2012;344:e555
  1. Nigel Hawkes
  1. 1London

Credit rating agencies could be used to assess the financial soundness of NHS foundation trusts, the regulator Monitor has suggested in a consultation paper.

It says that agencies such as Standard & Poor’s, Moody’s, or Fitch could be given access to a trust’s books and issue assessments of the trust’s credit rating. Such ratings are normally used by investors to help decide whether governments or corporations have the ability and willingness to repay financial obligations such as bonds. The agencies were heavily criticised for failing to identify the high risks being run by banks before the economic crisis of 2008.

The suggestion that they could provide a measure of the financial risk being run by foundation trusts appeared in a consultation paper issued by Monitor on 16 December last year as part of its proposed licensing regime for foundation trusts. …

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