S&P's Nears Settlement With Regulators On Real-Estate Bond Ratings : WSJ

(RTTNews) - Standard & Poor's Ratings Services is nearing a settlement with regulators over their investigation of how the company graded real-estate bonds, the Wall Street Journal reported citing people familiar with the matter.

The report quoted the people as saying that the proposed deal, which involves six commercial real-estate bond ratings from 2011, could be reached as early as next month. The joint settlement would be with the Securities and Exchange Commission, New York Attorney General Eric Schneiderman and Massachusetts Attorney General Martha Coakley.

The pact under discussion involves a suspension of S&P, for several months or possibly a year, from rating some deals. However, the suspension would be narrowly focused on what are known as "conduit" deals, which pool mortgages secured by commercial properties.

Besides a potential suspension, S&P is expected to receive a fine of at least $60 million. That figure mirrors what S&P parent McGraw Hill Financial Inc. (MHFI), took as an accounting charge for its third-quarter earnings, citing "active discussions" with the SEC, Massachusetts and New York, the report said.