Fitch to appeal against charges in Italy

Fitch Ratings intends to appeal against an Italian prosecution for market manipulation which targets some of its managers and analysts, Fitch said on Wednesday. The joint owner of the ratings agency via holding company Fimalac, Marc Ladreit de Lacharriere, told France Inter radio that the company was not worried about the prosecution since the proceedings were at an early stage, and Fitch would appeal immediately. "It is a very marginal case," he said. "It concerns a judge who considers that because we downgraded Italy, we might damage consumption by Italians and so he thinks that it was not right to do so," Lacharriere said. Earlier this month, Fitch, which is one of the top three ratings agencies alongside S&P and Moody's, said it would reduce its activities in Italy in the light of the prosecution. In opening proceedings, the court has said that it considers that Fitch downgraded Italy's credit rating for speculative purposes. The court is also taking action against several people employed by S&P. Lacharriere also commented on a court judgement against S&P in Australia at the beginning of November. He observed that Fitch had refused to get involved in giving credit ratings for the instruments concerned by that case. S&P may have made an error of judgement in deciding to rate them, he suggested. An Australian court has ordered S&P to compensate local authorities which had invested millions of Australian dollars in securities to which S&P had given good credit ratings but which fell heavily in value during the financial crisis in 2008. Lacharriere, who is also president of Fitch, also said that the agency would re-examine the credit standing of France "during 2013." He noted that Fitch had been the first of the three agencies to put France, with a top-notch "AAA" rating, under negative watch in December 2011. Late on Monday, Moody's downgraded its rating for France from "AAA" to "Aa1", S&P having done likewise in January. They have both put France on negative watch. This means that Fitch is the only one of the three still to attribute "AAA" to France.