Rating change probabilities

Bachelor Thesis from the year 2012 in the subject Business economics - Banking Stock Exchanges Insurance Accounting grade: 10 University of Mannheim language: English abstract: In my Bachelor thesis I analyze the determinants of rating changes and the variables'marginal effects on rating change probabilities. Based on my results I present transition matrices by computing transition probabilities. Furthermore I analyze subsamples of my data set conditional on the business cycle and the economic strength of a country by using interaction effects. I thereby verify whether or how the transition matrices change by including interaction effects.I apply a latent variable approach using an ordered probit model to calculate the effects of different variables on the probabilities of rating changes.