S&P provides more clarity for ‘on hold’ funds

Standard and Poor’s (S&P) has introduced new measures to improve the transparency around fund ratings placed ‘on hold’.

According to head of fund ratings Mark Hoven, a new listing on the research subscription service available to financial planners will “provide further clarity around how S&P is working with fund managers to resolve ratings on funds”.

He added: “We recognise that ‘on hold’ ratings can have a significant effect on fund managers and financial planners alike, and we always attempt to resolve ‘on hold’ ratings as expeditiously as possible.”

According to Hoven, the steps fund managers need to take to resolve their ‘on hold’ ratings can take weeks or months, especially in instances where high profile departures from the organisation have resulted in an ‘on hold’ rating.

“In extended ‘on hold’ situations, S&P may have several meetings with the fund manager until we can establish a level of conviction around the appropriate rating outcome,” Hoven said.

He added: “This is the kind of information that planners appreciate so they can continue to inform their clients and determine the most appropriate course of action.”

High profile departures from three property managers in recent months have prompted ‘on hold’ actions, with one manager still retaining the ‘on hold’ rating while it forms a new investment team and formalises its process.