The leaders of the world’s 20 most prosperous countries will consider stricter controls on ratings agencies at a meeting in South Korea later this month.

The controls, agreed by the G20 Financial Stability Board (FSB) and announced last week, are specifically designed to limit the role of credit ratings agencies in the financial system.

The FSB comprises regulators, central bankers and treasury officials from the G20 member nations.

Last week it called for the elimination “wherever possible” of references to credit ratings in legal statutes and business practices, and for the development of new and better ways to assess risk.

The major agencies – Moody’s, Standard & Poor’s and Fitch Ratings – have been under pressure for several years for failing to recognise exposures built up by banks and financial institutions firms which led to the global financial crisis.

The FSB said in a statement that its proposed new controls would help to eliminate “mechanistic reliance by market participants and establish stronger internal credit risk assessment practices”.