A merger between New York-based Fitch Investors Service LP and London- based IBCA Ltd. would have immediate advantages for both companies, according to sources close to talks on a deal between the two.

Sources said IBCA's worldwide network of offices and experience rating banks and securities outside the United States, combined with Fitch's U.S. expertise, would create a global rating agency well-positioned to compete with Moody's Investors Service Inc. and Standard & Poor's, the two industry leaders.

The two firms entered into serious talks about two weeks ago.

Fitch employs 350 people and recently embarked on a drive to expand its international ratings. IBCA, set up in 1978, opened a New York office in 1979.

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