Feb 27, 2024

Opinions on Credit Ratings Agency jobs?

I currently work at one of the big 3 ratings agencies (S&P/Moody's/Fitch) but outside of the ratings department as a consultant/service delivery associate for our buy side clients (PE/VC). It's glorified ops, and they only call me a consultant because I'm client-facing.  

Considering transferring to the ratings side of the business as a senior analyst. Base salary I've been told is anywhere from 90-140k (big range). WLB seems pretty good and I think the work sounds interesting. I currently make 80k in a MCOL city so it would likely be a decent bump. 

I went to a non-target for Finance and am halfway through a non-target MBA program that my company is paying for 100%. Thought about gunning for management consulting after my MBA since I'm a "consultant" by name right now, but senior ratings analyst would be an internal move and one I'm pretty sure I would be qualified for/could get. I would honestly be happy making 100-150k all-in in an MCOL city working 40 hours a week for the foreseeable future but wanted to hear thoughts. 


As in clients are just paying you for a certain credit rating? I figured if I was about to assign an A and the other guys were willing to assign an AA across the street then the client would just go across the street. Don't know if there's any negotiation involved between the rating agency and the client, although that would start getting into ethical issues pretty quick I would think. 


Would be very interested to see what the community's current thoughts are on CRA roles.  Previous comments on the forum are all over the place, although they are mostly mixed as this board is primarily oriented towards traditional high finance roles.  I'm currently in this position as a senior analyst covering ABS/RMBS.  The previous associate/senior analyst class exited mostly to securitized products/structured finance IB and credit-oriented AM during the hot market in 2021.  I've been looking at exits recently and have had a series of initial interviews across ABL, ABF, and SF IB with a handful of MM, BB, and MF firms.  Still early in the process on most of these but I haven't landed an offer yet, which I think will be difficult given the current competitive state of the job market.  I'm from a semi-target and I think it helps that my background prior to CRA was capital markets and whole loans, more applicable experience so I'm not strictly a ratings person.

Generally, the work is not all that rigorous, but you do develop a decent grasp of collateral, cashflow, and other risk factor analytics.  Decent exits do seem possible, but it is probably wise to leave sooner rather than later.


Hi! I'm joining an RA upon graduation and then hope to lateral into IB as an analyst. Is there a certain number of years of experience you look for when hiring/is there a minimum amount of time you would recommend I stay at the RA before trying to lateral?

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I started on the grad scheme at one of the "big 3" as a corporate credit analyst in London. Every single person I worked with who wanted to made a move to the buy side did. I have friends at CLO's doing leveraged loans, real-money LO's doing high yield credit, and even a few guys who moved to restructuring advisors and eventually to hedge funds. The key is not to get stuck at an agency. A lot of the senior guys are very risk averse and that doesn't translate well into a "markets" seat. Remember, the agencies are there to provide a rating, not to opine on whether or not a bond/loan looks cheap/rich. Also, these guys usually have great WLB, great management access, and will usually sponsor you for the CFA.    


Clearest point first: nobody will care that your current title has the world 'consultant' in it.  Especially a consulting firm, which is sensitive to the fact that their brand of consulting is different than what you currently do.  Whatever you decide, please don't allow the word choice in your job title to be a factor in the decision.

The consulting firms you want to work for will want analytical skills, and so will any other down-the-road job you might be interested in.  So a move to the ratings side will be better for getting any job down the road which values doing more brainy work.

Overall I think the ratings analyst role sounds pretty interesting. Just don't let it become formulaic to the point where you end up making the mistakes they did back in '08.


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