In Japan, credit ratings issued by Designated Rating Agencies (DRA) are used to estimate market risks and counterparty risks for the purpose of calculating the capital adequacy ratios for securities companies. 12 Japan also noted that for calculating the capital adequacy ratios for banks and other deposit-taking institutions, credit ratings issued by ECAIs are used subject to the Financial Services Agency (JFSA) ordinance under the Banking Act. In the United States, which features the most widespread use of credit ratings in LRSPs that establish capital requirements in the securities and banking sectors, the use of credit ratings for capital purposes is.
