Credit rating agency: Difference between revisions
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(CRA). | (CRA). | ||
Credit rating agencies are independent institutions that assess the creditworthiness - or the credit risk - of bond issuers and provide credit ratings which are publicly available and used by investors, as well as analysts, as a guide for investment decisions. | |||
The assessments by the credit rating agencies are mostly to do with the ability of the large organisations that issue bonds, to service their obligations to pay interest and principal on the bonds in full and on time. | |||
Well known credit rating agencies include Moody's, Standard & Poor's, and Fitch. | Well known credit rating agencies include Moody's, Standard & Poor's, and Fitch. | ||
Because of the trend towards regulation of credit rating agencies, some firms take care to avoid calling themselves a credit rating agency or to call their opinions credit ratings. | |||
In the US, the key recognition of long standing for a credit rating agency is as a Nationally Recognised Statistical Rating Organisation ([[NRSRO]]) by the [[Securities and Exchange Commission]]. | |||
The [[European Union]] subsequently followed suit with the idea of registered and certified credit rating agencies being recognised by the [[European Securities and Markets Authority]] (ESMA). | The [[European Union]] subsequently followed suit with the idea of registered and certified credit rating agencies being recognised by the [[European Securities and Markets Authority]] (ESMA). | ||
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== See also == | == See also == | ||
* [[AAA]] | * [[AAA]] | ||
* [[Agency]] | |||
* [[Bond]] | |||
* [[Corporate credit ratings: a quick guide]] | * [[Corporate credit ratings: a quick guide]] | ||
* [[Credit]] | |||
* [[Credit rating]] | * [[Credit rating]] | ||
* [[Credit reference agency]] | * [[Credit reference agency]] | ||
* [[Credit risk]] | * [[Credit risk]] | ||
* [[Creditworthiness]] | |||
* [[External Credit Assessment Institution]] | * [[External Credit Assessment Institution]] | ||
* [[Fitch]] | * [[Fitch]] | ||
* [[Investment grade]] | |||
* [[Issuer]] | |||
* [[Moody's]] | * [[Moody's]] | ||
* [[Ratings]] | * [[Ratings]] | ||
* [[Regulation]] | |||
* [[SRA]] | * [[SRA]] | ||
* [[Standard & Poor's]] | * [[Standard & Poor's]] | ||
* [[Sustainability]] | * [[Sustainability]] | ||
*[[Trade credit rating agency]] | |||
== | ==Other resource== | ||
[ | [https://www.esma.europa.eu/esmas-activities/investors-and-issuers/credit-rating-agencies ESMA - Credit rating agencies] | ||
[[Category:Financial_risk_management]] | [[Category:Financial_risk_management]] | ||
Latest revision as of 11:49, 16 September 2024
(CRA).
Credit rating agencies are independent institutions that assess the creditworthiness - or the credit risk - of bond issuers and provide credit ratings which are publicly available and used by investors, as well as analysts, as a guide for investment decisions.
The assessments by the credit rating agencies are mostly to do with the ability of the large organisations that issue bonds, to service their obligations to pay interest and principal on the bonds in full and on time.
Well known credit rating agencies include Moody's, Standard & Poor's, and Fitch.
Because of the trend towards regulation of credit rating agencies, some firms take care to avoid calling themselves a credit rating agency or to call their opinions credit ratings.
In the US, the key recognition of long standing for a credit rating agency is as a Nationally Recognised Statistical Rating Organisation (NRSRO) by the Securities and Exchange Commission.
The European Union subsequently followed suit with the idea of registered and certified credit rating agencies being recognised by the European Securities and Markets Authority (ESMA).
See also
- AAA
- Agency
- Bond
- Corporate credit ratings: a quick guide
- Credit
- Credit rating
- Credit reference agency
- Credit risk
- Creditworthiness
- External Credit Assessment Institution
- Fitch
- Investment grade
- Issuer
- Moody's
- Ratings
- Regulation
- SRA
- Standard & Poor's
- Sustainability
- Trade credit rating agency
