In the last few months, credit ratings agency Moody’s has issued a series of proposals including changing the system of rating transitions for investment-grade issues subject to event risk and proposing a new framework for evaluating bond covenants. The third area where change is certain is in response to the evolving debt capital market. Moody’s is attempting to enhance its methodology for speculative-grade corporate ratings, introducing new probability of default and loss-given default rating methodologies.