In most cases, for member jurisdictions that have incorporated the Basel II framework, the external ratings that can be used for the purpose of determining regulatory capital are limited to those provided by rating agencies recognised by national supervisors as ECAIs. Supervisors assess whether these criteria are fulfilled and aim at identifying rating agencies that issue ratings that are sufficiently sound and robust to warrant using them to determine the appropriate regulatory capital levels. Supervisors are also in charge of articulating the conditions and details for the use of ratings (eg, in the EU, for the mapping of external ratings.
