A rating agency is a company that evaluates the solvency of financial institutions, the quality of asset management, corporate management and the timeliness of settlement of obligations. The most famous and popular product of rating agencies is a credit rating. The indicator is calculated both for an individual company and for the state as a whole and expresses an assessment of solvency.

International rating agencies

International rating agencies are playing strategic role in the global economy. Their appraisal activity forms the degree of trust in banking structures, the attractiveness of individual companies or entire states for investors, increases or decreases the chances of receiving and influences the calculation of stock prices.

Despite the huge impact on world economy Each rating agency was originally created and operates as commercial structure. The main goal of such organizations is profit, regardless of whether they operate on an international or national scale. This fact is the main reason for doubts about the objectivity of rating agencies.

National rating agency

The Russian Federation has its own National Rating Agency (hereinafter referred to as NRA), which has been operating since 2002. The NRA is still considered the leading independent agency today. Russian Federation. Over the 14 years of operation, the company has come a long way. From a rating project in an experimental format, the organization has grown into an independent business project with high level efficiency and profitability. NRA assessments are recognized by objective government regulators and representatives of the professional community.

Rating of rating agencies

The most authoritative in the ratings of rating agencies are the so-called “Big Three” companies, including Fitch Ratings, Moody’s, and Standard & Poor’s. It is estimated that their reports account for approximately 95% of the entire international market for valuation services. It is these companies that appropriate credit ratings the most popular companies and states among investors. In fact, such opportunities give the main rating agencies to influence the economic and political situation on the world stage. Decisions made on credit ratings are often used as a lever of political pressure and are biased.

Bank rating agency

Bank rating agencies are involved in calculating the creditworthiness of individual banking institutions. Typically, research is initiated credit organizations on a paid, commercial basis. The assigned rating can be long-term or short-term in nature and depends on the timing of the financial institution's borrowings.

When compiling such ratings, several methods are used: different approaches. As a rule, we are talking about comparing a number of financial indicators. There are also more complex schemes, according to which each criterion receives a specific specific gravity, and the final score is summed up as a total number of points.

Russian rating agencies

There are four national rating agencies in Russia that have been accredited by the Ministry of Finance of the Russian Federation (Expert RA, NRA, RusRating, AK&M). In addition to these four companies, the Big Three rating agencies are also accredited in Russia.

In addition to the companies listed above, there is one more rating agency operating in the Russian Federation in the format of a joint venture. The organization has not been accredited by the Ministry of Finance, but is considered subsidiary company the famous rating agency Moody's, accredited in the Russian Federation. The Moody's Interfax Rating Agency organization appeared in 2001, after the reorganization of the Interfax RA. The company's work is based on a strategic cooperation agreement with Moody's Investors Service.

Difference between global and national rankings

In independent Russia there has always been an objective need to create independent rating agencies. The reason is the lack of opportunity international agencies assign individual Russian companies a higher rating than the state as a whole.

Valuation activities Russian companies costs an order of magnitude cheaper. In addition, their assessment is considered more objective, since it takes into account the specifics of business in the Russian Federation. The services of domestic RAs, in particular, are in demand among companies that do not even plan to develop international markets.

Are rating agencies objective?

Each rating agency commercial organization which seeks to maximize its own profits. This feature of RA prevents them from being completely objective. In recent years, there have been frequent cases of explicit or hidden corporate orders with specific objectives: to make a competitor’s rating worse, and specific company- better. Money buys very serious reports. A striking example of this statement is the crisis of 2008-2009, when a whole group of corporations with impeccable ratings found themselves on the verge of ruin.

Minimum requirements for rating agencies

1. Providing reliable and objective information based on historical data. The rating is subject to periodic review, and the methodology is changed every three years.
2. Independence. The ratings are free from economic pressure and political interference.
3. International access and openness.
4. A rating agency needs a sufficient number of staff to organize the analytical process with objective results.
5. Rating agencies are officially recognized by regulatory authorities and the professional community.

How can a private investor use information from rating agencies?

The reputation of rating agencies was seriously damaged after the 2008 crisis. It turned out that companies with impeccable ratings are capable of imploding like soap bubbles. For this reason, even the results of the Big Three reports should not be taken as the ultimate truth.

Moreover, the credit rating itself has never been and will not be a recommendation to buy or sell any assets. Ratings show only one characteristic - the level of creditworthiness of individual companies or states. And even companies and states with an AAA rating are susceptible to such a phenomenon as default. The difference is that among companies with a AAA rating, cases of bankruptcy will be isolated, while among companies with lower rates, bankruptcy will occur much more often.

Rating agencies(RA) – organizations specializing in assessing the creditworthiness of issuers and the investment quality of issued securities. Based on the results of their research, agencies assign credit ratings.

In order to use ratings correctly, it is necessary to understand that when issuing ratings, agencies primarily evaluate the likelihood of non-payment of debt. However, the ratings do not reflect a number of other factors that may be important for the borrower in the future, such as changes in economic conditions or problems with current liquidity.

RAs do not provide guarantees for the results of their research and do not fully disclose the methodology used.

Rating assignment is a commercial service. Its customers are states, companies, financial organizations. Having a rating gives issuers the opportunity to offer their securities to a wider range of investors, reduces interest rates, and also makes the borrower known and affects its reputation.

Thanks to ratings, investors can get an independent opinion on the possibility of investing cash, reduce risks, compare securities based on risk-return ratio. At the same time, agencies monitor the solvency of borrowers not only at the time of assigning a rating, but also throughout the entire period of cooperation, so investors have access to information about the reliability of their investments in virtually real time.

However, the disadvantage of RAs is that their data is often late. Their absolute failure was that they were unable to warn investors in a timely manner about problems in companies such as AIG, Enron, Lehman Bros., Parmalat, etc. The agencies were particularly criticized as a result of the 2008 crisis, when investment ratings were assigned to companies that were experiencing serious financial difficulties and even caused a crisis in the American real estate market. It was then that for the first time a number of leading investors began to have doubts about the professional competence of the RA.

It is believed that the main reasons for agency failures were: slow speed reactions to events, assumptions used in the methodology, between the agencies themselves, as well as a conflict of interest when the assignment of a rating is paid for by the state or the customer company interested in a positive assessment.

Historically, international ones have been registered in the United States. This is due to the fact that American investment funds are considered the largest participants in the capital market.

As for national RAs, it is believed that they can better take into account local specifics. Most famous Russian agencies- this is "Moody's Interfax Rating Agency, AK&M, .

See what “Rating agencies” are in other dictionaries:

RATING AGENCIES- (English rating agencies) – international and national analytical services that compile integral risk indices of economic entities based on the degree of reliability as borrowers. R.a. assess the reliability of various types of debt obligations... ... Financial and credit encyclopedic dictionary

International rating agencies- (International rating agencies) Rating agencies are organizations involved in assessing the solvency of financial market entities. International rating agencies: credit ratings of countries, Fitch Ratings, Moody s, S&P, Morningstar, ... ... Investor Encyclopedia

Credit rating and world rating agencies- For the first time in history, the international rating agency S P downgraded the US credit rating from the maximum AAA to AA+; this event occurred after the US averted a possible default. A credit rating represents an independent and reliable… Encyclopedia of Newsmakers

- (RA) – four agencies created in Russia and received accreditation by the Russian Ministry of Finance along with the “big three” international rating agencies: Expert RA, National Rating Agency (NRA), AK&M, RusRating. Moreover, in Russia... ... Banking Encyclopedia

European debt crisis- This article describes current events. Information may change quickly as an event unfolds. You are viewing the version of the article dated 14:59 December 13, 2012 (UTC). (... Wikipedia Wikipedia

Coupon- (Coupon) Concepts of coupon, types of bonds, bond market Information about the concept of coupon, types of bonds, bond market Contents Contents Types of bonds bonds General characteristics and classification of bonds Corporate bonds... ... Investor Encyclopedia

National rating agency- This article should be Wikified. Please format it according to the rules for formatting articles... Wikipedia

Welcome traders to the ForexLabor website. Economics, loans, accounts, accounting, all this accompanies not only ordinary people, people like you and me, but also entire states, only on a large scale. In order for a person to be given a loan from a bank, all the necessary information is collected about him in order to assess his solvency. It is beneficial for the bank to have the money returned to it, preferably with interest.

The best broker, in my opinion, for day trading and scalping.

It’s the same with states, only private investors and investment funds act as bankers for the state. But how can they know whether they will make a profit if they invest their hard-earned money in one country or another? Will the business be closed down or, which is quite possible in some countries, will it be nationalized? These and many other risks, as well as the level of solvency, are called upon to be assessed international rating agencies .

What is a rating agency?

At its core rating agency is a company that produces specific product. A commodity is an assessment of a particular subject of the world market economy, their product is the hard work of hundreds of analysts with many years of experience who can distinguish a potential bankrupt from a promising enterprise by analyzing their official and not so official statements.

Rating agencies even though commercial companies, but the initiators of their creation are often states. Co-founders often include consulting firms, news agencies and financial institutions. To make the work of a rating agency independent, control over its activities is distributed among participants in such a way that no one has a casting vote or the opportunity to individually influence the most important decisions of the company's management.

Before delving further into this topic, it’s worth saying right away that the assessments and ratings that agencies provide are not a 100% guarantee of the solvency of the research object. Rating agencies They make no guarantees and never tell anyone about their rating method.

Who usually orders the services of rating agencies? In most cases, the customer is various countries and companies that operate in the financial field. Availability of a rating from one of famous agencies, allows companies and customer countries to inspire more confidence among potential investors, and thus attract more money.

What exactly do rating agencies evaluate?

As has already been said many times, rating agencies evaluate the solvency of the issuer of debt obligations, giving it an appropriate assessment. Roughly speaking, they check a country or company to see if they can repay debts or not. In addition, some ratings indicate whether the principal and interest obligations will be repaid.

The higher the so-called credit rating , the more reliable the valued object is for investing in it. The most reliable securities in the world are considered to be US Treasury bonds, they are assigned highest rating, the classification of which we will talk about a little later.

Disadvantages of rating agencies

Before 2008, indicate disadvantages of rating agencies it was not entirely possible, since there were practically no precedents casting doubt on the competence of the personnel and the unreliability of the assessments of international rating agencies. But it was 2008 that changed everything.

Presenters rating agencies failed to foresee the US real estate crisis and the collapse of corporations such as AIG, Enron, Lehman Bros., Parmalat and many others. This dealt a significant blow to the reputation of appraisal companies and significantly undermined confidence in their activities.

Because of this crisis it was discovered main problem rating agencies are slow. Grading sometimes does not keep up with the dynamically changing global economic situation.

Based on this, the object being assessed may become an unreliable borrower until a rating is assigned. Or, on the contrary, financial condition the company may become more attractive and receive a lower rating than it should have been given, but this is not as bad for investors as the previous option.

Well-known rating agencies

• Fitch Ratings;
• Moody's;
• Standard & Poor's;
• Morningstar;
• A.M. Best Company.

Each company has its own specifics and rating methodology. Of these five companies, I would single out three as the most reliable and influential: Standard & Poor’s, Moody’s and Fitch Ratings. Let's talk about them in more detail.

Standard & Poor's

Also known by the acronym S&P. Many people recognize it as this rating agency is the founder of such powerful stock indices as the S&P 500 in the United States and the S&P 200 in Australia.

Many serious private investors, financial institutions and even countries consider this company one of the most authoritative in the world and sometimes rely entirely on the results of their research in making important decisions.

Standard & Poor's has been in business for over 150 years, assigning credit ratings, editing stock indices, as well as conducting research activities in the field of risk management.

From the latest ratings issued, it can be noted that not so long ago, the company lowered the credit rating of Ukraine from CCC to SS and changed its outlook from stable to negative. In essence, this means that there is little or no investment in the country, and the country has no way to pay its obligations, let alone pay interest. It is worth noting that such a low rating was issued despite Ukraine receiving impressive loan funds from the IMF and the EU to stabilize the economic situation.

Moody's

The agency has a permanent staff of 4,500 experts. The company has more than 26 representative offices in different countries of the world. Distinctive feature company is that after receiving an assessment, the agency leads a particular company for a certain period, its duration is agreed upon separately at the time of concluding the contract. After this period, Moody's either changes the previously assigned rating or leaves it at the same value.

If the customer company is cooperating with Moody’s for the first time, then in this case the expert group holds an initial meeting with the management of the customer company to familiarize themselves with and transfer the list of documents that will be required for the analysis. Sometimes some documents are already available, since they are no different from those prepared for management on a quarterly basis.

This company also assessed Ukraine, but a little earlier. Moody's downgraded the rating of Ukrainian bonds in 2012. There were several reasons for this: the cessation of publication of NBU reports, the lack of success in carrying out reforms and agreements with the Russian Federation on gas, the unpredictable political situation and administrative interference in the activities of the international Forex market. As a result of all these actions and inactions, the bond rating fell from B2 to B3.

Fitch Ratings

The foundations of the company were laid in 1913 with the publishing house of financial statistics. Over time, all this has grown into an independent rating agency, whose assessments are trusted all over the world. Currently, Fitch Ratings has a staff of about two thousand people in more than 50 countries.

Fitch Ratings is the first company to be recognized by the National Commission for security USA and licensed by NRSRO. This agency is known, among other things, for issuing two very important ratings: Short-Term Issuer Default Rating and long-term rating issuer default abbreviated as ER.

Short-term RED is assigned to the subject economic activity, which must fulfill its obligations within a certain grace period (from 1 to 3 years).

How do rating agencies give ratings?

Assigning a rating is a complex research activity. Rating agencies evaluate many variables such as financial strength, ability to pay bills, condition of property, profitability and business activity.

Each of these variables includes several more. For clarity, take a look at the figure below.

This is a simplified diagram, an example of assessing an ordinary enterprise. Of course, as already mentioned, the agencies do not disclose the methodology of their work. In addition, the scoring algorithm may differ depending on what exactly is being assessed.

The rating algorithm itself looks something like this: The rating agency and the customer company enter into a contract for the provision of services. Further, at the request of the agency, the company provides all the necessary information, which may also include an interview with the company’s management.

After collecting information, research is carried out and, based on this, the company is assigned a preliminary assessment to the customer. The agency informs the company about the results of its work.

1. The customer agrees with the rating given. A press release is issued and the rating is published in official publications.
2. The company disagrees with the results. A non-disclosure agreement is signed and documents are never made public.

Rating classification

An investment rating means that an economic entity is reliable and able to fully pay its debt obligations. Investors are more willing to invest in the economies of countries with an investment rating. The highest investment rating is AAA; only a few, such as US government bonds, have it. The lowest investment rating is BBB, investment attractiveness owners of this assessment are quite high, but the economic situation may change, which suggests that investors should be careful.

A speculative rating is no longer good, even at the highest BB value. States and companies with ratings of this class pay high interest on their obligations. In addition, companies that engage in investments have strict restrictions on the amount of funds that can be invested in speculatively rated issuers.

A positive forecast means that the current situation may improve over a period of 3 to 6 months.

A stable forecast means that no improvements can be expected, but a serious deterioration of the situation is unlikely to occur in the next six months.

Negative – speaks for itself; it is quite possible that the issuer’s situation with such a forecast will worsen.

Rating scale of international rating agencies

The role of rating agencies in the global economy

Rating agencies are one of the most important organizations in the global economy. I think you won't argue about that modern world would be impossible without investment. Rating agencies help investors invest in more reliable companies and warn against “garbage,” thereby filtering the economy from uncompetitive players, leaving the strongest in the market.

Compiling bank ratings, financial companies, business structures, we often rely on data published by reputable and respected rating agencies. Their assessments are listened to all over the world; decisions in business and politics are made on their basis.
Today we present Top 10 most authoritative rating agencies, both in the international and Russian arena.

10. National Rating Agency

This Russian rating agency was created in 2000 and was accredited by the Russian Ministry of Finance. Specializes in assigning ratings to banks, non-bank credit institutions, insurance companies and non-governmental pension funds, as well as management and investment companies.

9. A.M. Best Company, Inc.

It is an international rating agency headquartered in Oldwick, New Jersey, USA. Main specialization – insurance companies. The specificity of the assessment is to determine the rating financial stability, which determines the extent to which the insurer is able to fulfill its obligations to policyholders. The formula for calculating the rating is the property of the company

8. Dominion Bond Rating Service (DBRS)

The credit rating agency was founded in Canada in 1976. Today it is the largest Canadian RA. The existing scale of short-term debt ratings shows how great the risk is that the borrower will not be able to timely fulfill its own obligations on short-term debts.

7. Moody`s Interfax Rating Agency

The leading rating agency in Russia, where they are assigned on a national scale, which reflects the agency’s opinion on the creditworthiness of the issuer and its debt obligations on the national market. Russian financial institutions, regional and municipal administrations, as well as companies in the non-financial sector resort to the services of Moody`s Interfax Rating Agency.

6. RA AK&M

This Russian rating agency, accredited by the Russian Ministry of Finance, was created in 1994. In addition to company ratings, the RA assesses the creditworthiness of the constituent entities of the Russian Federation and municipalities. AK&M also compiles ratings of leading enterprises of the Russian Federation.

5. "Expert RA"

One of the most authoritative rating agencies in Russia. It is the information and research division of the Expert group of companies. Founded in 1997 The agency compiles credit ratings of private companies, credit ratings of regions and evaluates their investment attractiveness.

4. Morningstar (NASDAQ: MORN)

American RA specializes in collecting and analyzing information on investment funds. Consumers are provided with databases, training courses, reviews and software. The fund rating system is based on assigning stars (from 1 to 5), which allows summing up data on the fund's stability in terms of the ratio of profitability and risk.

3. Standard & Poor's (S&P)

An agency engaged in analytical research of the financial market. The company is one of the three most influential international RAs. The American stock index S&P 500 and the Australian S&P 200 were created by this company. The agency evaluates both issuers and individual debt obligations. The Standard & Poor’s international scale allows you to compare the reliability of issuers and obligations of different countries.

2.Moody's

One of the most authoritative international ones in the world. RA is a subsidiary of Moody's Corporation. The agency is engaged in research and risk analysis, assigning credit ratings. Moody's has more than 4,500 employees in 26 countries.

1. Fitch Ratings

This international diversified corporation has gained fame precisely as a rating agency. Back in 1924, the Fitch agency introduced a rating scale from “AAA” to “D”. Today, the company's core mission is to provide independent and future-oriented credit assessments, analytics and research to global markets.

What are rating agencies? What is the point of their work?

They assess the risks of investing in companies or entire countries and help to understand who is a potential bankrupt and who is a promising player in the market. When assessing, experts rely on open and closed reports on financial indicators, market positions, plans and many other indicators. The assessment is also influenced by risk factors - the stability and prospects of the economy as a whole, the quality of supervision in the relevant area. To put it simply, they study a country or company for its ability to fulfill loan obligations.

What types of rating agencies are there? What are their differences?

The most famous and authoritative rating agencies are the “big three”: Moody's, Fitch and Standard & Poor's (S&P). But besides them, there are also DBRS, China Chengxin Credit Rating Group, Dagong and JCR and others. There are four rating agencies in Russia: Expert RA, National Rating Agency (NRA), AK&M, RusRating.

In the “Big Three” there is no most authoritative or most important - different companies can trust different agencies; some take into account the opinions of all three. In a study by economist Shorya Ghosh of the Leonard Stern School of Business approved , that the most conservative agency is S&P, but any typology of rating agencies is conditional.

Who determines the authority and competence of rating agencies?

Market. This is a matter of reputation - if a rating agency often makes mistakes, or someone noticed a conflict of interest with the customer in its assessment, then the opinion of that company is less sought after (and therefore has less influence).

How to understand ratings?

In addition to ratings, there is a note about “negative”, “positive”, “stable”, “developing” forecast. What is this?

Having a rating from a well-known and reputable agency gives investors confidence and helps companies raise money. For potential investors, agency assessments are a guide to the financial world, thanks to them you can decide where to invest your money. For others, this is an expert assessment of how a company or country is doing economically.

Give an example of the work of a rating agency?

News last days: Moody'slowered ratings three oil-producing countries. It is believed that the main reason for this decision is low prices for oil, coupled with the strong dependence of the economies of these countries on the sale of oil.

Potential investors or those who have already invested money in the country could not miss this news - expected that investment in Saudi Arabia, Oman and Bahrain will decline.

An example that is closer to us is at the beginning of 2015 S&P and Moody's demoted assessment of the solvency of the Russian economy to the BBB- level. Perhaps Russia will soon be able to correct the assessment, especially since the countryrelatively small external debt, considers Head of the “Finance and Economics” department of the Institute modern development Nikita Maslennikov. But a low rating means it is more difficult for governments and companies to obtain loans abroad, and some investment funds prohibit investing in countries and companies with a “junk” rating. Economist Alexey Kudrin notes that because of this “the market will sag” and “pressure on the ruble will increase.”

How do agencies make money?

They usually receive money from the companies or countries that order the ratings and from the agency's subscribers. Subscribers receive published ratings and associated reports.

Why do I need to know about this, how does it affect me?

Speaking globally, from agency reports you can understand the economic situation in your country and find out the forecast for two to three years.

Typically, the economy is influenced by many factors: government income, inflation rate, foreign policy, what are the main budget items, etc.

The rating only reflects the general situation with the country’s economy and summarizes all these factors. With a low rating, it will be more difficult for the state and companies to obtain loans, the number of investments will decrease - accordingly, the country’s budget will decrease and this will affect the income of the population.

From time to time someone claims that foreign rating agencies are biased, is this true?

In Russia, most often they talk not about the economic, but the political side of the matter - that the reduction in the ratings of the country and domestic companies is some kind of “conspiracy” against Russia. There is no direct evidence of this.

The agencies also have critics in the West - for example, Nobel Prize winner and influential economist Paul Krugman wrote a column there noted , that “it’s hard to find anyone who understands less about the US economy than the rating agencies.”

It is difficult to believe that the Big Three are in conspiracy with the US government - the US Department of Justice has long is suing with S&P, demanding $5 billion for ratings, which, according to the agency, partially led to the crisis of 2007-2008.

Do the forecasts of rating agencies often fail to come true?

Perhaps the most high-profile cases occurred with the energy corporation"Enron" , which had an investment rating (above BBB-), almost until bankruptcy. The Big Three also failed to predict a default Russia in 1998, the same thing happened in Argentina in 2001.

The human factor also plays a role. “Yes, agencies make mistakes quite often. And the whole “troika” can give an incorrect forecast. After all, people work there, and they tend to make mistakes,” believes Head of the analytical department of Alfa Forex company Andrey Dirgin.

Why not use the services of Russian agencies?

Thomas Piketty, Capital in the Twenty-First Century;

David Graeber, Debt: The First 5000 Years of History;

Sergey Guriev “Myths of Economics”;

How the Economy Works by Ha Joon Chang;

Lietar Bernard "The Future of Money".