Standard & Poor's President to Step Down

Imagine that!

Standard & Poor’s announced on Monday night that its president was stepping down, just weeks after the ratings agency ‘s unprecedented downgrade of the U.S. credit rating.

Deven Sharma is set to leave his post on Sept. 12, and will leave S&P at year’s end, according to the release from McGraw-Hill, S&P’s parent company. Douglas Peterson, the current chief operating officer at Citibank, will replace Sharma.

The announcement comes after some tumultuous weeks at the ratings agency, which found itself slammed by the Obama administration for its decision to downgrade America’s then-AAA credit rating to AA+.

The markets had a volatile set of days in the aftermath of the downgrade, yo-yoing up and down for days.

The Justice Department is also reportedly investigating S&P for its ratings of mortgage securities in the run-up to the financial crisis, and top shareholders are also pushing to break up McGraw-Hill.

Still, the S&P announcement said that Sharma was leaving because he was ready for new challenges, and media reports have said the company was laying the groundwork for the move for months and that it was unrelated to recent developments.

In a statement, Harold McGraw III, the chief executive of McGraw-Hill, said that Sharma was leaving after helping S&P split into two separate entities, a credit rater and McGraw-Hill Financial.

“Today, S&P is a stronger company, whose 1,300 global analysts are sharply focused on the quality, independence and transparency of S&P's research and analytics,” McGraw said.

In announcing its downgrade of U.S. debt this month, S&P said it was skeptical that Washington policymakers would be able to bridge their ideological differences in the push to rein in federal deficits.

But President Obama and Treasury Secretary Timothy Geithner, among others, sharply criticized the rater’s move, in large part because of what they called a $2 trillion calculation error.

Moody’s and Fitch, two other major ratings agencies, continue to give the U.S. their top rating.

By Bernie Becker