S&P unveils overhaul of ratings process

NEW YORK/LONDON (Reuters) - Standard & Poor's unveiled an overhaul of its ratings process on Thursday as it responds to widespread criticism of the quality and accuracy of credit ratings.

Ratings agencies have come under fire for their role in the U.S. subprime crisis, with critics saying they were too slow to downgrade highly rated securities linked to poor quality mortgages. Some argue that the ratings should not have been assigned in the first place.

"By further enhancing independence, strengthening the ratings process, and increasing transparency, the actions we are taking will serve the public interest by building greater confidence in credit ratings and supporting the efficient operation of the global credit markets," Deven Sharma, president of S&P, said in a statement.

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In terms of analytics, the agency said it would highlight additional factors not covered by traditional default ratings, such as liquidity, volatility, correlation and recovery.

The agency said it would also create a user manual and investor guidelines for credit ratings.

Meanwhile, the International Organization of Securities Commissions (IOSCO), the world's top group of market regulators, said on Wednesday it planned to change the code of conduct for agencies to ban them from helping to design structured products that they also rate.

(Reporting by Ritsuko Ando and Jonathan Stempel in New York and Richard Barley in London; Editing by Alan Raybould and Quentin Bryar)