EU leaders take credit rating agencies to task

By George Parker in London, Tony Barber in Brussels and,Bertrand Benoit in Berlin

Published: January 30 2008 02:00 | Last updated: January 30 2008 02:00

Credit rating agencies were warned last night by European leaders to address conflicts of interest and provide better information to the markets or face new regulation at a "credit crunch" summit in London.

Gordon Brown, the British prime minister, said the European Union wanted the rating agencies and big audit firms to improve financial transparency, arguing it was vital to "rebuild confidence" in the markets.

Angela Merkel, German chancellor, said a lack of trust was undermining faith in the capitalist system and could fuel protectionism. "That is a very wrong move," she said.

The leaders of Europe's biggest economies said they wanted the financial system to get its own house in order, but warned that regulators stood ready to act if greater transparency was not forthcoming.

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http://www.ft.com/cms/s/0/27a0f6b8-ced6-11dc-877a-000077b07658.html