Egan-Jones Responds to SEC Order for Formal Review of Application to Resume Rating of Issuers of Asset-Backed Securities and Government Securities

NEW YORK, March 23, 2026 /PRNewswire/ -- Egan-Jones Ratings Company responded to a March 23, 2026 Order ("Order") issued by the Securities and Exchange Commission ("SEC") for the SEC to conduct a formal review of Egan-Jones' application to resume rating of issuers of asset-backed securities and government securities. The SEC's Order establishes that the Commission must decide on the application to determine whether re-registration should be denied for these two classes of securities by August 12, 2026.

Sean Egan, co-founder and CEO of Egan-Jones, stated, "This is the SEC process, and we will provide all information necessary to support our application to resume rating these two classes of issuers of securities. Egan-Jones has made great strides in our internal and compliance processes, and we are confident that our progress will be evident to the Commission. Egan-Jones enjoys widespread respect for its independent and reliable ratings. We expect that our expanding the classes of securities we rate will enhance competition in the marketplace. Increasing competition in the ratings market is a stated priority for the U.S. Congress, and Egan-Jones' application embraces that opportunity."

As reflected in the Order, on October 7, 2025, Egan-Jones applied for two additional NRSRO licenses which it previously held. The requested licenses are referred to in the industry as asset-backed securities ("ABS") and Government/Sovereign/Municipal securities. On January 14, 2026, Egan-Jones supplemented its application. The SEC formal review process will enable Egan-Jones to demonstrate that the firm qualifies for reissuance of the two additional licenses. Egan-Jones looks forward to the opportunity to provide the SEC Commissioners with details regarding the firm's qualifications. Unlike other credit rating firms paid by the issuers for their ratings, investors primarily pay for Egan Jones' ratings, thereby assuring independence. Egan-Jones has a superb record for rating debt.

Following the Credit Crisis of 2008, Congress concluded that the legacy rating firms were key enablers of the capital markets meltdown¹ and instructed the SEC to increase competition.² Unfortunately, the markets continue to be dominated by the same firms which were criticized widely during the Credit Crisis³ and again missed the mark in recent failures of Tricolor and First Brands Group.

Egan-Jones looks forward to addressing any questions that the SEC may raise during the review process.

About Egan-Jones Ratings
Egan-Jones, an NRSRO founded in 1995, offers timely and accurate credit ratings and proxy services.

Media Contact for this Release:
Debra DeShong
[email protected]

¹ https://www.sec.gov/newsroom/speeches-statements/lizarraga-statement-credit-ratings-060723.  Referencing the Financial Crisis Inquiry Report, page 25: "We conclude the failures of credit rating agencies were essential cogs in the wheel of financial destruction. The three credit rating agencies were key enablers of the financial meltdown."
² The SEC's Office of Credit Ratings' Annual Report stated that Moody's issued 670,000 ratings resulting in 31.7% of the total 2.11 million ratings, and S&P issued 1,055,000 ratings resulting in 50% market share. According to a formula recognized by the Department of Justice, this combined total represents nearly double the level to be considered highly concentrated. Using revenue rather than number of ratings would produce even higher scores, as the two firms, which follow the issuer-pay model, typically charge more than other rating firms.
³ On June 7, 2023, then Commissioner Jaime Lizárraga of the SEC issued a statement on ending the reliance on credit ratings and highlighting the lack of reliability of ratings issued by ratings agencies [legacy credit rating firms]. Specifically, he stated that:

"In its 2011 Final Report, the Financial Crisis Inquiry Commission found that "the failures of [the three] credit rating agencies were essential cogs" in the 2008 financial crisis. The report concluded that the "crisis could not have happened without the rating agencies."

SOURCE Egan-Jones Ratings Company