INTERNATIONAL

CREDIT
RATING
AGENCIES

D I B E S H PA D I A
A D H YAYA N B H E R A
CREDIT RATING AGENCY
A credit rating agency is a company which rates the
debtors on the basis of their ability to pay back the debt
in a timely manner. The rates large scale borrowers,
weather companies or governments.
THE BIG THREE AGENCIES

1.Standard & Poor’s

S&P Global Ratings (previously Standard & Poor’s) is an American credit rating agency (CRA) and a division
of S&P Global that publishes financial research and analysis on stocks, bonds, and commodities. Its head office is
located on 55 Water Street in Lower Manhattan, New York City.[

S&P has a total of 17 ratings it can assign to corporate and sovereign debt. Anything rated AAA to BBB- is
considered investment grade, meaning it has the ability to repay debt with no concern. Debt rated BB+ to D is
considered speculative, with an uncertain future. The lower the rating, the more potential it has to default, with a
D-rating being the worst.
STANDARD & POOR’S (LINKEDIN)
[

S&P Global Ratings is the world’s leading provider of independent credit ratings. This ratings are essential to
driving growth, providing transparency and helping educate market participants so they can make decisions with
confidence. We have more than 1 million credit ratings outstanding on government, corporate, financial sector
and structured finance entities and securities. We offer an independent view of the market built on a unique
combination of broad perspective and local insight. We provide our opinions and research about relative credit
risk; market participants gain independent information to help support the growth of transparent, liquid debt
markets worldwide. S&P Global Ratings is a division of S&P Global (NYSE: SPGI), which provides essential
intelligence for individuals, companies and governments to make decisions with confidence.
BACKGROUND OF STANDARD & POOR’S
 MOODY’S
Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of 
Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's
Investors Service provides international financial research on bonds issued by commercial and government
entities.

The company ranks the creditworthiness of borrowers using a standardized ratings scale which measures
expected investor loss in the event of default. Moody's Investors Service rates debt securities in several 
bond market segments. These include government, municipal and corporate bonds; managed investments such
as money market funds and fixed-income funds; financial institutions including banks and non-bank finance
companies; and asset classes in structured finance. In Moody's Investors Service's ratings system, securities are
assigned a rating from Aaa to C, with Aaa being the highest quality and C the lowest quality.
Moody's was founded by John Moody in 1909 to produce manuals of statistics related to stocks and bonds and
bond ratings. In 1975, the company was identified as a Nationally Recognized Statistical Rating Organization
 (NRSRO) by the U.S. Securities and Exchange Commission.[3] Following several decades of ownership by 
Dun & Bradstreet, Moody's Investors Service became a separate company in 2000. Moody's Corporation was
established as a holding company.[4]
 MOODY’S (LINKEDIN)

Moody's Investors Service is a leading provider of credit ratings, research, and risk analysis. Moody's
commitment and expertise contributes to transparent and integrated financial markets. The firm's ratings
and analysis track debt covering more than 135 sovereign nations, approximately 5,000 non-financial
corporate issuers, 4,000 financial institutions issuers, 18,000 public finance issuers, 11,000 structured
finance transactions, and 1,000 infrastructure and project finance issuers. Moody's Investors Service is a
subsidiary of Moody's Corporation (NYSE: MCO), which reported revenue of $4.2 billion in 2017,
employs approximately 12,300 people worldwide and maintains a presence in 42 countries
BACKGROUND OF MOODY’S
 FITCH
Fitch Ratings Inc. is an American credit rating agency and is one of the "Big Three credit rating agencies",[3] the
other two being Moody's and Standard & Poor's. It is one of the three 
nationally recognized statistical rating organizations (NRSRO) designated by the 
U.S. Securities and Exchange Commission in 1975.
Fitch Ratings is dual headquartered in New York and London.[4] Hearst owns 100 percent of the company following
its acquisition of an additional 20 percent for $2.8 billion on April 12, 2018. [2] Hearst had owned 80 percent of the
company after increasing its ownership stake by 30 percent on December 12, 2014, in a transaction valued at $1.965
billion. Hearst's previous equity interest was 50 percent following expansions on an original acquisition in 2006. [
citation needed]

Hearst had jointly owned Fitch with FIMALAC SA, which held 20 percent of the company until the 2018
transaction. Fitch Ratings and Fitch Solutions are part of the Fitch Group.
The firm was founded by John Knowles Fitch on December 24, 1914, in New York City as the Fitch Publishing
Company. In 1989, the company was acquired by a group including Robert Van Kampen.[5] In 1997, Fitch was
acquired by FIMALAC and was merged with London-based IBCA Limited, a FIMALAC subsidiary. [6] In 2000 Fitch
acquired both Chicago-based Duff & Phelps Credit Rating Co. (April) and Thomson Financial BankWatch
(December).[citation needed]
Fitch Ratings is the third largest NRSRO rating agency, covering a more limited share of the market than S&P and
Moody's, though it has grown with acquisitions and frequently positions itself as a "tie-breaker" when the other two
agencies have ratings similar, but not equal, in scale.
In September 2011, Fitch Group announced the sale of Algorithmics (risk analytics software) to IBM for $387
million.[citation needed] The deal closed on October 21, 2011.
 FITCH (LINKEDIN)
Fitch Ratings is a leading provider of credit ratings, commentary and research. Dedicated
to providing value beyond the rating through independent and prospective credit opinions,
Fitch Ratings offers global perspectives shaped by strong local market experience and
credit market expertise. The additional context, perspective and insights we provide help
investors to make important credit judgments with confidence.

Fitch Group is a global leader in financial information, providing critical insights that
inform better decision-making in financial markets. With operations in more than 30
countries, Fitch Group is comprised of: Fitch Ratings, a global leader in credit ratings and
research; Fitch Solutions, an authority in credit and macro intelligence providing fixed-
income products and services to the global financial community; and Fitch Learning, a
preeminent source of training and professional development. Fitch Group is owned by
Hearst, a leader in diversified media, information and services.
BACKGROUND OF FITCH
CREDIT RATING SCALE
BACKGROUND OF STANDARD & POOR’S
Henry Varnum Poor first published the "History of Railroads and Canals in the United States" in
1860, the forerunner of securities analysis and reporting that would be developed over the next
century. Standard Statistics formed in 1906, which published corporate bond, sovereign debt, and
municipal bond ratings. Standard Statistics merged with Poor's Publishing in 1941 to form 
Standard and Poor's Corporation, which was acquired by The McGraw-Hill Companies in 1966.
Standard and Poor's has become best known by indexes such as the S&P 500, a stock market index
 that is both a tool for investor analysis and decision-making, and a U.S. economic indicator.
 BACKGROUND OF MOODY’S
John Moody and Company first published "Moody's Manual" in 1900. The manual
published basic statistics and general information about stocks and bonds of various
industries. From 1903 until the stock market crash of 1907, "Moody's Manual" was a
national publication. In 1909, Moody began publishing "Moody's Analyses of Railroad
Investments," which added analytical information about the value of securities. Expanding
this idea led to the 1914 creation of Moody's Investors Service, which, in the following 10
years, would provide ratings for nearly all of the government bond markets at the time. By
the 1970s Moody's began rating commercial paper and bank deposits, becoming the full-
scale rating agency it is today.
 BACKGROUND OF FITCH
John Knowles Fitch founded the Fitch Publishing Company in 1913, providing financial statistics for
use in the investment industry via "The Fitch Stock and Bond Manual" and "The Fitch Bond Book”.
In 1923, Fitch introduced the AAA through D rating system that has become the basis for ratings
throughout the industry. With plans to become a full-service global rating agency, in the late 1990s
Fitch merged with IBCA of London, subsidiary of Fimalac, a French holding company. Fitch also
acquired market competitors Thomson Bank Watch and Duff & Phelps Credit Ratings. 6 Fitch began
to develop operating subsidiaries specializing in enterprise risk management, data services, and
finance-industry training starting in 2005 with the acquisition of a Canadian company, Algorithmics, 7
and the creation of Fitch Solutions and Fitch Training (now Fitch Learning). 5
Credit Rating Agency
 conclusion
A credit rating is a useful tool not only for investor or,but also for the entities looking for
investors .An invetment grade rating can put a security ,company or country on the
global radar ,attracting foreign money and boosting a nation’s economy.I ndeed
,emerging market economies,the credit rating is the key to showcase their worthiness
of money for foreign investors,and because the credit rating acts to facilitate
investments ,many countries and companies will strive to maintain and improve their
ratings ,hence ensuring a stable political enviroment and better transperancy.
Credit rating agencies can best serve markets when they
operateindependently,adopt and enforce internal guidelines to avoid conflicts of
interest and protect confidental information received from issuers .credit rating
agencies should be made accountable for any faculty rating.