Which Is A Credit Rating Agency In India

Jk Papers Receive A+ Ratings

India Ratings and Research rated JK Papers at A+ with the outlook to be stable.

Given below are the instrument wise rating actions:

10 December 2019

Exim Bank Extends Line Of Credit Of Usd 40 Million To Maldives

Projects covered under these LOCs to Maldives include housing project, Greater Male’ Connectivity project, water & sewerage projects, Addu Development project, International Cricket Stadium project, road construction and sports infrastructure.

The writer’s mentions were a mix of sarcastic and jibe-filled tweets.

Most Popular Credit Rating Agencies In India

A Credit Rating Agency is a company that assigns ratings to the debtors according to their ability to pay back the debt in a timely manner. These agencies provide highly essential risk assessment reports and analytical solutions and assign a definitive credit score to both individuals as well as organizations. These reports are considered important for getting the loan.

Any individual, corporation, state or provincial authority, or sovereign government that seeks to borrow money are assigned with a Credit Rating.

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How Do Credit Rating Agency Work

These agencies analyses an organization, individual, entity and assign ratings. These agencies have authority to rate companies, state governments, non-profit organizations, securities, local governmental bodies and special purpose entities.

A number of factors are considered while setting rating like the financial statements, type of debts, lending and borrowing history, the capability of repayment, past credit repayment behaviour and more. These factors contribute to a great extent in computing the end result that is the credit score.

These agencies dont provide any decision to the financial institutions on whether an entity should get credit facility or not, it provides the report and additional inputs thereby making it easy for the lenders to analyse and make an informed decision.

Who Are These Credit Rating Agencies

Globally, Standard & Poors , Moodys and Fitch group are recognized as The Big Three credit rating agencies. In terms of acceptability and influence, these three collectively have a global market share of 95% as per the CFR report, USA .

The Indian credit rating Industry has also evolved with the emergence of professionally competent agencies like CRISIL, ICRA, ONICRA, CARE, CIBIL, SMERA, and others. Below are details of important credit agencies.

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The Big 3 Credit Rating Agencies

The credit rating industry is dominated by three big agencies, which control 95% of the rating business. The top firms include Moodys Investor Services, Standard and Poors S&P Standard and Poor’sStandard & Poors is an American financial intelligence company that operates as a division of S&P Global. S&P is a market leader in the, and Fitch Group. Moodys and S&P are located in the United States, and they dominate 80% of the international market. Fitch is located in the United States and London and controls approximately 15% of the global market.

Morningstar Inc. has been expanding its market share in recent times and is expected to feature in the top four rating agencies. The U.S. Securities and Exchange Commission identified the big three agencies as the Nationally Recognized Statistical Rating Organizations in 1975.

The big three agencies came under heavy criticism after the global financial crisis for giving favorable ratings to insolvent institutions like Lehman Brothers. They were also blamed for failing to identify risky mortgage-backed securities that led to the collapse of the real estate market in the United States.

High Mark Credit Information Services

High Mark Credit Company is known as recognized service provider in the field of credit sharing and marking, the company with its base in Mumbai started a decade ago in Mumbai and flourishing rapidly till date. Some of the top rated features and services offered by the company include bureau services, risk management and analytic solution to debt roles and financial marketing. The services institution operates includes MSME, Rural & Cooperative Sector, Retail Financing, and Micro-Finance.

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Process Of Registration Under Sebi As Explained Below

• The person proposing to commence any activity as a credit rating agency has to apply to the Board in the form of application in Form A as prescribed in the regulations along with a non-refundable fee.
• The board shall not consider the regulations unless the applicant is promoted by a person belonging to any of the following categories:
• A Public Financial Institution

Ology Of Credit Rating

The process of credit rating begins with the prospective issuer approaching the rating agency for evaluation. The experts in analyzing banks should be given a free hand and they will collect data and informant and will investigate the business strength and weaknesses in detail. The entire process of rating stands on the for of confidentiality and hence even the most confidential business strategies, , future outlook etc., are revealed to the steam of analysis.

The rating is based on the investigation analysis, study and interpretation of various factors. The world of investment is exposed to the continuous onslaught of political, economic, social and other forces which does not permit any one to understand sufficiently certainty. Hence a logical approach to systematic evaluation is compulsory and within the framework of certain common features the agencies employ different methodologies. The key factors generally considered are listed below:

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Significance Of Credit Rating Agencies

• These agencies determine the risk that is associated by investing in the companies.
• This aids in making;Informed Investment Decisions. Credit Ratings give a fair estimate of the ability of the organisations to fulfill their financial commitment.
• A high credit rating indicates a high possibility of paying back the loan.
• The Credit Rating of organizations also helps the lending institutions in deciding the loan eligibility of the their borrower.
• The increasing levels of default resulting from easy availability of finance, is another factor that has led to the growing importance of the Credit Rating.
• Credit Rating also plays a vital role in financial markets. They assess the credit risk of the corporate or government borrowers by analyzing the relevant information available regarding the borrower and its economic circumstances. This analysis is reflected in Credit Rating. This rating represents an opinion about the likelihood of meeting the financial obligations by the borrower.;

Rbl Bank’s Credit Card Issuance Rate To Be Impacted Post Rbi’s Mastercard Ban

“Our bank’s current run rate of approximately 1,00,000 new credit card issuances per month could potentially be impacted till such time that there is clarity from the regulator on issuing new credit cards on the Mastercard network or till the technical integration with Visa is complete,” RBL Bank said in a regulatory filing.

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The Big Three Agencies

Credit rating is a highly concentrated industry, with the “Big Three” credit rating agencies controlling approximately 95% of the ratings business.Moody’s Investors Service and Standard & Poor’s together control 80% of the global market, and Fitch Ratings controls a further 15%.

As of December 2012, S&P is the largest of the three, with 1.2 million outstanding ratings and 1,416 analysts and supervisors; Moody’s has 1 million outstanding ratings and 1,252 analysts and supervisors; and Fitch is the smallest, with approximately 350,000 outstanding ratings, and is sometimes used as an alternative to S&P and Moodys.

The three largest agencies are not the only sources of credit information. Many smaller rating agencies also exist, mostly serving non-US markets. All of the large securities firms have internal fixed income analysts who offer information about the risk and volatility of securities to their clients. And specialized risk consultants working in a variety of fields offer credit models and default estimates.

Market share concentration is not a new development in the credit rating industry. Since the establishment of the first agency in 1909, there have never been more than four credit rating agencies with significant market share. Even the Financial crisis of 200708where the performance of the three rating agencies was dubbed “horrendous” by The Economist magazineled to a drop in the share of the three by just one percentfrom 98 to 97%.

Importance Of Credit Ratings

Credit rating represents an objectively analyzed assessment of the creditworthiness of the borrower. So, the scorecard affects the amount that companies or governments are charged to borrow money. A downgrade, in other words, pushes down the value of the bonds and raises interest rates. These, in turn, influence the overall investor sentiment concerning the Borrower Company or Country.

If a company perceives to have undergone a downturn in fortunes and its rating is lowered, investors might ask for higher returns to lend to it, thereby judging it to be a riskier bet. Similarly, if the economic and political policies of a country look gloomy, its ratings are downgraded by global credit agencies thereby influencing the flow of investments in that country. On a macroscopic level, these changes affect economic policies of a nation.

An endorsement from a convincing rating agency makes life easier for countries and financial institutions issuing bonds. It basically tells investors a firm has a track record and indicates how likely it is to be able to pay back the money.

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What Does Credit Rating Mean

A credit score is a 3-digit number that represents the creditworthiness of the borrower. Credit rating is the analysis of the possible credit risks associated with granting a financial instrument to an individual or a company. Based on the credit score, a lender determines whether the borrower can repay the loan amount or not.

The rating is provided based on the creditworthiness and the credentials of an individual or a company. The creditworthiness of an individual or a company is decided based on the lending and borrowing transactions done in the past. Credit rating is determined after weighing the statements of liabilities and assets, and their ability to meet the debt obligations.

It is recommended that you maintain a good credit rating if you would like to apply for a huge loan in the future.

You can maintain a good score given that you pay all your existing debts on time, check your credit report once in a while to stay informed of your score and keep your credit utilisation ratio below 30%.

The credit score is determined based on the following factors.

• Payment History: 35%

What Is The Importance Of A Credit Rating Agency

With these agencies, the risk associated with the investing companies can be determined. Therefore it helps in making informed decisions. It also helps in arriving at a fair judgement of the organizations ability to fulfil its commitment.

There are many other factors that show us the importance of these agencies. One among them is the easy availability of finance that led to increase in default levels. These agencies play a crucial role in financial markets. They analyze the credit risk of a government or corporate. As there are information about the economic condition of the borrower.

It represents the likelihood that a borrower is gonna meet financial obligations. Therefore the importance of these agencies has gone up as it has helped in assessing the creditworthiness of an individual/company.

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Rbi Governor To Focus On Performance Of Bank Chiefs

The Reserve Bank of India ;Governor;Shaktikanta;Das said;that the apex body will put more;focus on;the central bank in coming months, as per a report from PTI.;It;will bring;corporate governance reforms in the banking and non-banking;finance companies ;space to improve transparency and accountability.;He further added that RBI the performance of chiefs such as MDs and CEOs of public and private sector banks should be closely monitored by the Board of Directors. The performance evaluation will be conducted by either through a sub-committee or an external peer group review, added Das.;

Das was speaking at the 15th convocation of the National Institute of Bank Management , Pune.;He said that in a bid to take care of corporate governance and to improve the functioning of the PSB boards, enhance their quality and stability is the key. The stability of the PSB can be done via further streamlining appointment process, succession planning and compensation. Das said that the RBI will continue to play a positive and constructive role to ensure private banks flourish.;;

10 June 2019

Role Of The Credit Rating Agency

The credit rating agencies rate the creditworthiness of issuers of debt obligations, of debt instruments, and in some cases, of the services of the underlying debt. The debt instruments rated by CRAs include government bonds, corporate bonds, CDs, municipal bonds, preferred stock, and collateralized securities, such as mortgage-backed securities and collateralized debt obligations.

A credit rating is an evaluation of the credit risk of a prospective debtor. Also, predicting their ability to pay back the debt, along with this, makes a forecast of the chances for the debtor defaulting. The credit rating represents an evaluation of a credit rating agency of the qualitative and quantitative information for the prospective debtor, including information provided by the prospective debtor and other non-public information obtained by the credit rating agencys analysts. Credit risk is the risk of default on a debt that may arise from a borrower failing to make required payments.

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India Ratings Affirms Sansar Trust September 2018 Ii

India Ratings and Research has affirmedSansar Trust September 2018 IIs ratings as follows:

*as per August 2021s payout

The new and used passenger vehicle and commercialvehicle loans pool assigned to the trust has been originated by ShriramTransport Finance Company Limited .

Telecom Industry Needs To Migrate To Optic Fiber Cable Network Says Icra

ICRA credit rating agency has stated that the Indian telecom industry needs to migrate from traditional copper-based networks to dense optic fiber cable networks as the country has more than a billion mobile phone users. Moreover, the mobile data consumption has recorded a substantial increase in the past two years, added ICRA.

As per the latest numbers, the country has 539 million wireless internet subscribers thanks to the easier availability of affordable smartphones, low data tariffs, increase in speeds of delivery and enhanced content. People in the country are consuming 418,330 terabytes of data. ICRA reported that data consumption is expected to grow further in the long term thanks to the rise in applications, improving technology and more content. As a result, the telecom networks need to be robust and have the capacity to carry large amounts of data and deliver it quickly.

Currently, India has around 5 lakh towers of which only 22% have fiber network, in comparison China has 80%. India has 110 million km of fiber deployed as against 420 million km in the United States and 1,090 million km in China. The credit rating agency estimates the present market value of fiber assets owned by major private telecom operators is about Rs.1.2 lakh crore. The extent of fiber rollout over the next few years will require investments of Rs.2.5 lakh crore to 3 lakh crore.

3 April 2019

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Days Of Record Low Rates Numbered But Rbi’s Liftoff Still Sometime Away

Das and the current MPCs tenure has been bogged down by one crisis after another. In February 2019, when Das took over the reins, India was slumping ever so deep into an economic abyss. And just when signs emerged of a recovery, it was plunged into the darkness by the Covid-19 pandemic and national lockdown last year.

Hudco Surveillance Credit Ratings Upgraded: Icra

ICRA Limited credit rating company has reaffirmed their surveillance credit rating of Housing and Urban Development Corporation Limited for the financial year 2019-20. ICRA has upgraded HUDCO ratings to:

The ba1 BCA rating reflected the fact that almost all lending is to entities owned by Indian state governments, resulting in a low credit risk business model. Shares of Housing and Urban Development Corporation Ltd was last trading in BSE at Rs.33.75 as compared to the previous close of Rs.34.6.

31 July 2019

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The Small And Medium Enterprises Rating Agency Of India

The Small and Medium Enterprises Rating Agency of India is an agency that functions exclusively for the sector for which it was formed, i.e., Micro, Small, Medium and Micro Enterprises. The agency was discovered in the year 2005 by SIDBI , Dun and Bradstreet Information Services India Private Limited, various public, the private sector, and other Multinational Company Banks located in India.; The agency has its roots in Mumbai. SMERA has been registered with the SEBI as a credit rating agency and accredited by RBI in the year 2012. It is an external credit assessment institution . The SMERA ranks bank credits under the Base II guidelines. Ranking of various instruments like IPO, bonds, commercial papers, NCDs, fixed deposits, security receipts, etc. is done by SMERA which can be used by all banks for capital acceptability requirements calculation as authorized by the Reserve Bank of India.

SMERA pioneered SME ranking in India, and till now it has ranked more than 38,000 industries. Many of the financial institutions highly consider SMERA rankings before approving or lending funds.

FITCH India