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CREDIT RATING Consultants for improved score of CRISIL, CARE & ICRA  - India

Credit Rating Consultants

CRISIL RATINGS FOR BANK LOANS (Basel II )

Loan ---> Short term i.e. L/C , B/G
TYPE MEANING

CRISIL A1

very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

CRISILA2

strong degree of safety regarding timely payment of financial obligations. Such instruments carry low credit risk.

CRISILA3

moderate degree of safety regarding timely payment of financial obligations. Such instruments carry higher credit risk as compared to instruments rated in the two higher categories.

CRISILA4

have minimal degree of safety regarding timely payment of financial obligations. Such instruments carry very high credit risk and are susceptible to default

CRISIL D are in default or expected to be in default on maturity.
  CRISIL may apply '+' (plus) sign for ratings from 'CRISIL A1' to 'CRISIL A4' to reflect comparative standing within the category

S & P rating of Indian Banks

Loan -----> Long term i.e.  CC , D/L , T/L
TYPE Risk Description
CRISIL AAA highest safety are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.
CRISIL AA high safety are considered to have high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk.
CRISIL A adequate safety are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.
CRISIL BBB moderate safety are considered to have moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk.
CRISIL BB moderate risk are considered to have moderate risk of default regarding timely servicing of financial obligations
CRISIL B high risk are considered to have high risk of default regarding timely servicing of financial obligations
CRISIL C very high risk are considered to have very high risk of default regarding timely servicing of financial obligations
CRISIL D default are in default or are expected to be in default soon.
CRISIL may apply '+' (plus) or '-' (minus) signs for ratings from 'CRISIL AA' to 'CRISIL C' to reflect comparative standing within the category.

CRISIL may assign rating outlooks for ratings from 'CRISIL AAA' to 'CRISIL B'. Ratings on Rating Watch will not carry outlooks. A rating outlook indicates the direction in which a rating may move over a medium-term horizon of one to two years. A rating outlook can be 'Positive', 'Stable', or 'Negative'. A 'Positive' or 'Negative' rating outlook is not necessarily a precursor of a rating change

In case of CARE & ICRA, the ratings are identical with CRISIL being substituted by CARE & ICRA respectively.

 

PADMANABHAN COMMITTEE CREDIT RATING

  • The Padmanabhan Committee recommended the fol­lowing ratings:
  • A: Fundamentally sound in every aspect .
  • B: Fundamentally sound but with moderate weakness
  • C: Financial, Operational and / or compliance weakness~ and raises supervisory concerns.
  • D: Serious or moderate Financial , operational and / or managerial weaknesses that could impair the future vi­ability.
  • E: Critical Financial Weakness that has the possibility of failure

Three Major Rating Agencies in India

CRISIL
* India’s first credit rating agency, incorporated in 1987 and promoted by the erstwhile ICICr Ltd, along with UTI and other financial institutions.
* Commenced operations in 1988. In 1995, in partnership will National Stock Exchange, CRISIL developed CRISIL500 Equity Index.
* In 1996, it made a strategic alliance with the Standard & Poor’s (S&P)’ Ratings Group and in the following year Standard & Poor’s (S&P) Ratings Group acquired 9.68% stake in CRISIL.
* In services Industry, CRISIL set up the Indian Index Services Ltd as a joint venture with the NSE in 1988 and in 1999, it developed a Risk Assessment Model (RAM) which became a banking industry standard.
* S&P acquired the majority stake in the company in 2005 and CRISIL became a S&P company.

Corporate Rating Database  by CRISIL

ICRA
* India’s second credit rating agency  (Investment Information and Credit Rating Agency).
Set up in 1991, promoted by Industrial Finance Coroporation of India (IFCI), other leading financial/in­vestment institutions, commercial banks and financial services companies as an independent and professional Investment Information and Credit Rating Agency.
* Today, ICRA and its subsidiaries together form the ICRA Group of Companies (Group ICRA).
* ICRA Limited is a Public Limited Company, with its shares listed on the Bombay Stock Exchange and the National Stock Exchange.

CARE:

The third Credit rating Agency in India; started  in 1993; was mainly promoted by the lOBI.

 

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