Three firms join to set up independent rating agency

Chinese ratings agency Dagong said Tuesday it was tying up with US and Russian partners to form a new "independent" group to rival US-based agencies it claims have "proven inadequate."

Dagong will join with Pennsylvania-based Egan-Jones Ratings Co (EJR) and Russia's RusRating JSC, it said in an invitation for a press conference Wednesday.

The joint venture, called Universal Credit Rating Group, will engage in global ratings affairs "as an entirely independent ratings service provider," Dagong said in the letter.

"The current international credit rating system has proven inadequate to the task of producing responsible and reliable ratings," it said, noting a new institution is needed to "mitigate economic risk."

The three partners "do not represent the interest of any particular country or group," and Universal Credit Rating Group will "provide impartial rating information to the global capital markets," it said.

US-based agencies Fitch, Standard & Poor's and Moody's - responsible for giving risk assessments to investors - were widely criticized for failing to warn about the impending global financial crisis in 2008.

EJR says on its website that it exclusively serves "buy side institutional investors."

RusRating, based in Moscow, focuses on ratings for the banking sector.