Information asymmetry and the Brazilian sovereign rating in the assessment of Credit Rating Agencies

Objective: analyze the asymmetries of information in the content of the synthetic reports issued by the Credit Rating Agencies (CRA) Standard & Poor's, Moody's, and Fitch on the Brazilian sovereign rating.Method: a content analysis was performed on the CRA synthetic reports to create variables and categories. Correspondence Analysis (CA) aimed these same category variables at a multidimensional space for comparative analysis.Originality/Relevance: the study shows how the asymmetry of information between lenders and borrowers of sovereign bonds can also be preceded by the CRAs when they make different assessments of the same financial product available to the market. The result shows that information asymmetry between creditors and borrowers does not end; it just changes the source of information.Results: the results showed that, although the content of the evaluations was harmful in the CRA, there are asymmetries in specific categories. Standard & Poor's, for example, was the agency that stood out the most in the analyses; this is because it differs from other CRAs and positions itself more freely between categories in different years.Theoretical/Methodological contributions: the study integrates qualitative and quantitative methods to expand research on CRA information asymmetry. The study also analyzes synthetic reports, the most accessible to decision-makers in the market, showing that the analysis of complex reports and robust data is not exclusive to analyzing asymmetric information. In addition, it explores results on information asymmetry and the Brazilian sovereign, where few approaches and investigations have focused on the national academic scenario.