On the day Amber Partners announced that insurance companies will offer discounts to hedge firms that get an Amber rating, Moody’s Investors Services reportedly has entered the field. The Bermuda-based Amber made quite a splash last fall when it launched its service to provide due diligence reports on HFs, designed to give investors a hand in choosing investments. The company, which expects to have about 30 HF clients by second quarter, obviously impressed insurers, and the likes of Aon Limited, ASF Financial and a number of other U.S. and U.K. insurers said they will cut premium costs for HFs that rate, “in recognition of the direct correlations between superior operational risk management and improved insurance risk,” says Richard Ellis, associate director of Aon.
Meanwhile, Moody’s is said to be launching a rating service of its own in April, which differs from Amber in at least one respect. While Amber will either assign or not assign certification, Moody’s is taking a more fine-tuned approach by assigning one of five rating levels to a fund, from “excellent” to “unrated.” Both firms are leaving it up to the fund manager whether to publicize it.
