Credit rating: Difference between revisions

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imported>Doug Williamson
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imported>Doug Williamson
(Update - source - Association of Corporate Treasurers - email from Naresh Aggarwal 16 Feb 2022.)
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1. ''Larger organisations - borrowings - securities - bonds - credit rating agencies.''
1. ''Larger organisations - borrowings - securities - bonds - credit rating agencies.''


A credit rating is an external assessment of creditworthiness.
A standardised assessment, expressed alphanumerically, of the creditworthiness of an entity raising debt capital – be it a company, an investment vehicle (mutual fund), a country (sovereign) and its affiliated public agencies or regional/local authorities or a supranational institution – provided by credit rating agencies to investors and analysts.  
Although the general term can apply to individuals and smaller businesses, in treasury it is usually used with reference to public debt issued by larger corporations or public bodies.


So for example a bond issue by a large corporation, or by a government, would usually be given a credit rating by one or more credit rating agencies or other bodies.
Credit ratings also serve as a measure of the risks related to specific financial investments.




2. ''Smaller & medium sized organisations - credit reference agencies.''
2. ''Smaller & medium sized organisations - credit reference agencies.''


An external assessment of creditworthiness provided by a credit reference agency.
An external assessment of general creditworthiness for a smaller organisation, provided by a credit reference agency.




== See also ==
== See also ==
* [[AAA]]
* [[AAA]]
* [[Agency]]
* [[Bond issue]]
* [[Bond issue]]
* [[Climate change: testing the resilience of corporates’ creditworthiness to natural catastrophes]]
* [[Climate change: testing the resilience of corporates’ creditworthiness to natural catastrophes]]
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* [[Junk]]
* [[Junk]]
* [[Moody's]]
* [[Moody's]]
* [[Mutual fund]]
* [[NAIC]]
* [[NAIC]]
* [[Non-investment grade]]
* [[Non-investment grade]]
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* [[SACP]]
* [[SACP]]
* [[Solicited rating]]
* [[Solicited rating]]
* [[Sovereign]]
* [[Standard & Poor's ]]
* [[Standard & Poor's ]]
* [[Sub-prime lending]]
* [[Sub-prime lending]]
* [[Supranational]]
* [[Toxic]]
* [[Toxic]]
* [[Unrated]]
* [[Unrated]]

Revision as of 11:04, 16 February 2022

1. Larger organisations - borrowings - securities - bonds - credit rating agencies.

A standardised assessment, expressed alphanumerically, of the creditworthiness of an entity raising debt capital – be it a company, an investment vehicle (mutual fund), a country (sovereign) and its affiliated public agencies or regional/local authorities or a supranational institution – provided by credit rating agencies to investors and analysts.

Credit ratings also serve as a measure of the risks related to specific financial investments.


2. Smaller & medium sized organisations - credit reference agencies.

An external assessment of general creditworthiness for a smaller organisation, provided by a credit reference agency.


See also


Other links

Measuring up, The Treasurer, Nov 2014