Standard poor's credit rating service. Country ranking according to S&P

The rating agency (RA) Standard & Poor's (S&P) is an international company that specializes in research and assessment of the creditworthiness of securities issuers. This agency provides such a service as the assignment of an international credit rating. Her customers are financial companies, firms, states. The presence of a rating provides an opportunity for issuers to offer their own to a fairly wide range of investors. A credit score makes a lender more famous and enhances their reputation.

Characteristics of RA "Standard & Poor's"

This entity is a subsidiary of the American "McGraw-Hill", which is engaged in analytics research financial market.

The history of this organization has about 150 years. Representative offices of RA "Standard & Poor's" are located in 23 countries of the world. This organization, in addition, is known as the founder and editor of the Australian stock index S&P 200 and American - S&P500.

Functions of RA "Standard & Poor's":

Oversight;

Informative;

Regulatory;

prognostic.

Services of RA "Standard & Poor's":

implementation of analytical information and the results of their research to investors.

Ratings of RA "Standard & Poor's"

This organization uses the following letters to indicate the long-term rating of the so-called "safe investments":

A, A+, A- are credit ratings characterized as "reliability above average", with enough effective factors protection. A credit rating with the designation A- informs that during economic crises there are risks of non-payment of the principal debt or dividends on it.

ВВВ+, ВВВ, ВВВ- - credit ratings of the level of "reliability below the average", in which the probability of repayment of the loan and interest is considered adequate, and the degree of risk varies depending on the stage of development of the country's economy.

Speculative or, in other words, "junk", non-investment ratings of RA "Standard & Poor's":

B+, B, B- - degree financial protection varies depending on external financial and economic conditions and on the stages economic development states.

What is a credit score?

Analysts of the agency, based on a variety of sources of information, compile credit ratings , exposing the issuer of debt obligations a kind of assessment of solvency. Those. credit rating - this is this assessment, "compressed" in a short letter expression with a certain financial meaning. The higher the credit rating, the more reliable the object for investment, but also the lower its potential yield on debt instruments (bills, bills).

World rating agencies

In the global market today, there are three generally recognized rating agencies that cover about 95% of the market:

Standard & Poor's

Moody's Agency

Fitch Agency

• international, according to which debt issuers are compared with other countries or foreign companies;

• national, by which issuers are compared within one country

Depending on the term of the creditworthiness forecast, a long-term rating (long term, for a period of more than a year) and short-term (short term, less than a year) are distinguished. The latter is associated with the long-term and changes (increases or decreases) synchronously with it.

And, finally, there are types of ratings in foreign (foreign) and local national (local) currency. For one issuer, they may differ if there are different conditions for fulfilling obligations in national currency regarding foreign ones.

S&P credit rating

The rating value ranges from the best "AAA" to the worst "D". Signs "+" or "-" (plus / minus) can be added to the letter designation from "AA" to "CCS". They reflect a slightly better or slightly worse position of the issuer within one rating position. For example, an issuer with an AA+ rating is slightly more reliable for an investor than an issuer with an AA rating. Accordingly, the issuer "AA-" is less reliable for investments than "AA".

• positive (Positive) rating value can be increased;

• negative (Negative) - lowered;

• stable (Stable) - the value most likely will not change;

• developing (Developing) - the value can be both increased and decreased.

Forecasting horizon - from 6 months to 2 years.

S&P rating scale

• investment category (stable, successful issuers or securities);

• speculative (more risky group of issuers); this group's ratings are sometimes referred to as "junk".

Letters and alphanumerics (A-1, A-2, A-3, etc.) in brackets refer to the short-term rating scale. Instead of the last two lines, other designations can be specified:

• R - due to the unfavorable financial condition, the issuer is under the supervision of regulators, which may decide in favor of the advantage of fulfilling one obligation over others;

• SD - the issuer cannot redeem one obligation or category of obligations, but redeem others;

• D - the issuer is unable to fulfill all or almost all obligations.

How to find out the rating calculated by S&P?

From the agency's website:

http://www.standardandpoors.com/home/en/us — English version;

http://www.standardandpoors.com/home/ru/ru - Russian version

On the main page on the left there is a search bar, under which you need to select a search parameter:

• the name of the country or organization ("entity");

• security ticker (“ticker”);

• security code (CUSIP, CINS, ISIN).

After that, you need to enter the required name in the search bar and select the desired one from the proposed pop-up options. If the inscription “NR” appears on the issuer, it means that the rating was not assigned. However, at the first access, the system will require registration:

After going through an easy procedure and receiving a confirmation letter to the specified email address, you can enter the name of the organization of interest to us in the search box (“Find a Rating…” field). If we search for the Interactive Brokers broker, we will see the following results for today:

Local Currenty LT and ST mean the long-term and short-term rating of the broker in local currency, and Local Currenty LT and ST - the same ratings in foreign currency. The table shows that the broker is highly reliable with a slightly higher short-term rating, as well as a stable long-term outlook (penultimate CreditWatch/Outlook column) made at the end of 2014. And here are the data for today for the Russian Federation:

Quite expectedly, the country's rating in national currency (rubles) turns out to be noticeably higher than in foreign (primarily in dollars). In addition, it can be seen that, according to the agency, the creditworthiness of the broker considered earlier is higher than that of Russia as a whole - if we choose the dollar as a common denominator. We periodically raise the question of the political bias of such ratings - I personally consider them quite objective and based both on historical data (remember the default of 1998 or the recent December 2014) and on the real state of affairs (Russia's dependence on oil, see).

The probability of default on corporate bonds for 1981-2013 as a percentage:

Moody's credit rating

Numbers 1,2,3 can be added to categories from "Aa" to "Saa". The unit "says" that the issuer occupies the top line in its rating category (for example, "Aa"). Two is in the middle. Three - at the bottom of the rating category. Such a rating is designated as follows: for example, "Aa1", "B2", "Caa3".

In addition to calculating the value, the agency also provides long-term and short-term rating forecasts - as does S&P.

Short-term rating other than indeterminate NP (no short-term credit assessment) may vary from P-1 (Prime-1, excellent repayment short-term liabilities) to P-3 (Prime-3, acceptable ability to repay short-term debts). With respect to the Moody's ranking table above for long-term obligations all Prime values ​​listed fall into the investment category, i.e. with an issuer rating of at least Baa.

How can I find out the rating calculated by Moody's?

https://www.moody's.com/ - English version;

https://www.moodys.com/pages/default_ee.aspx - version in Russian

The search field is located on the main page of the site in the upper left part. In this field, you must enter the name of the country or company you are looking for, or the ticker security. This will display a drop-down list of the most suitable options. By clicking on the required one, we automatically move to the page with the ratings of the issuer we are looking for. The very first in the generated list is a long-term foreign currency rating.

If an agency user visits the site for the first time, in order to search for a rating, as in the case of S&P, it will be necessary to register once, including by ticking the “I agree to the terms of use of the site” checkbox. I managed to do this only by squandering the agreement to the end. After filling in a few lines and confirming the registration by e-mail (by clicking on the link), you will be automatically redirected to the Moody's website already under your login. If this did not happen, then the specified email should be the login. Let's look for the rating of the Russian Federation:

This shows that Russia's long-term foreign currency rating is designated as Ba1, i.е. stands just on the verge of investment and speculative categories. At the same time, the short-term rating has not been determined, the specified forecast is negative, which is quite at odds with the stable forecast from S&P (although both were made in 2016 with a difference of about six months). In total, despite the many evaluation parameters, the ratings are relatively subjective. However, for Moody’s, a convenient indicator is to view the rating history of the issuer, for which you need to switch to the “Rating” tab:

Here you can see how, having fallen to the level of default in 1998, Russia's long-term rating in the national currency from 2000 to 2009 began to grow, which was caused by an increase in oil prices. Its stabilization at high levels by 2010 also stopped Russia's rating, and the fall in the price of a barrel, along with the devaluation of the ruble in December 2014, led to some downgrade. "Domestic" denotes a domestic rating in national currency, "Foreign" - in foreign. "Senior Unsecured" can be translated as senior unsecured debentures: in national or foreign currency, respectively. In total, you can select and view 5 types of rating at once - but they are close to 100%, so I will limit myself to what is shown in the picture. Pressing " Issuer Outlook" you can also see the history of the company's forecasts for the future issuer rating. In the case of foreign issuers, the English version may sometimes be more productive.

Fitch Ratings credit rating

The rating scale of this agency is similar to the S&P scale and has an alphanumeric designation. The sign "+" or "-" is added to the ratings from "AA" to "B". Information about the rating of a particular issuer can be found on the following websites (after registration):

https://www.fitchratings.com/site/home - English version

http://www.fitchratings.ru/ru/ - Russian version

Let's choose the Russian version. As in previous cases, you must go through the formal registration procedure by clicking on "Create Account". There are a few more fields to fill in than in previous systems, but it’s easy to deal with them - the data is not checked, so you can write any phone numbers and home address (unlike email, which will receive confirmation). After filling in everything and putting two checkmarks at the bottom, we receive a confirmation letter to our inbox and click on the link in it. Then you can return to the main page and enter your username and password in the upper right corner. Once logged in, let's try to find Russia's rating there by entering "russia" - unlike S&P and Moody's, there are no pop-up hints here yet. We get the following results:

In fact, the Fitch agency is the only one of all three that allows you to search in Russian - i.e. in the search bar you can type and " the Russian Federation". Although it is better to use the English version of the site to search for the rating of foreign issuers (the item "Issuers" there will correspond to " ENTITIES" - but in general, according to my observations, of all three systems, this one is the most capricious in displaying information). Click on the lowest issuer:

As can be seen from the table, the description of the rating is in Russian. The first two lines indicate liabilities in foreign currency, the first line can be considered the most important for the issuer's assessment. By clicking on "Rating history" at the bottom right, you can see the history of assigning a rating to the issuer (similar to Moody's, only there the history is presented in the form of a graph). The outlook for the issuer is indicated as a colored icon to the right of the rating value:

Those. For Russia, Fitch has a stable outlook for today. Letter designations can be decrypted as follows:

In parentheses, as before, is the short-term rating.

Comparison of ratings of world agencies

Three of the world's most popular agencies that assign their ratings were discussed above. The importance of this action can hardly be overestimated - millions of investors and multibillion-dollar capitals are guided by them. And although in estimates, and especially in forecasts, the data of agencies may differ from each other, with respect to large issuers, the discrepancies are almost never significant. At the end of the article, I draw a table of correspondence of the ratings of all three agencies relative to each other:

As noted in the S&P rating commentary, Russia has demonstrated a commitment to a conservative macroeconomic policy, which is likely "to support strong external and fiscal balances." “A flexible exchange rate will allow the economy to cope with shocks that could be caused by tightening sanctions and lower commodity prices,” the agency said.

“The rating action reflects a prudent policy that allowed Russian economy adjust to lower commodity prices and international sanctions,” S&P said in a release. In addition, the agency noted the actions of the Bank of Russia, which, despite the purge banking system allowed to maintain financial stability.

The problems of the economy have not gone away

However, one should not flatter oneself: the Russian sovereign rating, according to S&P, has only caught up with the ratings of Kazakhstan, India and Indonesia, and S&P is extremely cautious in assessing Russian economic prospects. The agency forecasts low economic growth rates (1.7-1.8% until 2021, while the Russian government expects growth faster than 2%) amid unfavorable demographics (population aging, shrinking working-age population) and weak labor productivity. Structural barriers to productive growth include "the dominant role of the state in the economy, a challenging investment climate and relatively low levels of competition and innovation," S&P notes.

At the same time, the agency highlights Russia's jump in the World Bank's Doing Business ranking from 120th position a few years ago to 35th, as well as initiatives Russian government to increase labor productivity and increase investment.

Fitch, in turn, notes “a strong sovereign balance sheet, reliable external factors and improvement economic policy in a relationship macroeconomic indicators". At the same time, the agency points to "structural weaknesses (dependence on commodities and management risks), as well as geopolitical contradictions." Fitch forecasts economic growth averaging 2% in 2018-2019 amid reduced uncertainty, easing monetary policy and stable oil prices. The average economic growth for the investment category BBB is 3.1%.

What will happen after the presidential elections?

S&P also touches on political issues in the commentary. The high approval ratings of the authorities could allow the state to make unpopular reforms, the agency believes, but does not believe in the reality of such a choice. The Russian authorities have spoken a lot before, for example, about privatization and demonopolization of the economy, but deeds differed from words, S&P writes, not expecting a significant reduction in the role of the state in the economy. “Russia has a weak system of checks and balances between institutions and a high centralization of power. We have seen this in recent restrictive action against independent media and increased barriers to genuine political participation,” S&P points out. And he warns that while macroeconomic stability is likely to continue after the March 2018 presidential election, “the uncertainty surrounding the future transition of power could undermine the predictability of policy priorities.” ​

Fitch also notes uncertainty about "the main elements and timing of a broader reform agenda" after the presidential election. “President Vladimir Putin is on track to win the presidential election again in March 2018,” the agency points out.

Senior Emerging Markets Analyst management company Manulife asset management Richard Segal told RBC on the eve of the S&P decision that stabilization is in favor of Russia economic growth, low inflation, a reduction in the budget deficit and that "the economy has become more flexible due to the depreciation of the ruble and the introduction of a new, clearer budget rule." Against Russia are such factors as limited growth potential of the economy, problems and risks in the banking sector, about 70% of which is again controlled by the state, shortcomings corporate governance(recent example - ) and the uncertainty of the political landscape in the future three years, said Segal.

Inflow into Russian securities

Russia's return to the investment rating category means that Russian sovereign Eurobonds will be able to return to global debt indices such as Bloomberg's Barclays Global Aggregate. In February 2015, Barclays excluded the Russian external debt from the family of these indices, due to which those institutional investors who follow the indices have lost the opportunity to buy or hold Russian Eurobonds. S&P's decision "will make it possible to expand the participation in the Russian debt market of such conservative institutional investors as foreign pension funds and Insurance companies”, said Finance Minister Anton Siluanov.

Now about a third of Russian government bonds (both ruble OFZs and Eurobonds) are owned by foreign investors. Societe Generale estimated that the rise Russian rating before investment grade could trigger an inflow of $1-2 billion into Russian Eurobonds, Bloomberg reported.

A credit rating is an independent and reliable assessment of an issuer's creditworthiness, on the basis of which market participants can make informed financial decisions. This may entail a reduction in the issuer's costs of attracting borrowed money. For those issuers that raise funds against third-party guarantees, a credit rating may reduce the cost of such a guarantee or raise funds more efficiently without purchasing a guarantee.

international rating agency Standard & Poor's (S&P) - subsidiary McGraw Hill Corporation, engaged in analytical research of the financial market. Belongs to the top three most influential international rating agencies. As an international rating agency, Standard & Poor's assigns short-term and long-term credit ratings.

Credit ratings can be assigned to an issuer (national government, regional and local authorities, corporations, financial institutions, insurance companies, funds, etc.) or a separate debt obligation.

In the CIS countries, Standard & Poor's assigns ratings on an international scale (for obligations in national and foreign currencies) and on national scales created specifically for each specific country (currently for Russia and Kazakhstan).

Indexes of the Standard & Poor's family are used by investors around the world to evaluate the effectiveness of investments, as well as as a basis for a wide range of financial instruments such as index funds, deposit products, futures, options, and exchange-traded funds (ETFs).

The issuer's credit rating according to the Standard & Poor's international scale expresses the current opinion on the general creditworthiness of the issuer of debt obligations, the guarantor or guarantor, business partner, his ability and intention to timely and fully fulfill his debt obligations.

The credit rating of debt obligations according to the international scale Standard & Poors expresses the current opinion on credit risk on specific debt obligations (bonds, bank loans, loans, other financial instruments).

Standard & Poor's long-term rating assesses the ability of the issuer to fulfill its debt obligations in a timely manner. Long-term ratings range from the highest category - "AAA" to the lowest - "D". Ratings in the range from "AA" to "CCC" can be supplemented with the sign " plus" (+) or "minus" (-), denoting intermediate rating categories in relation to the main categories.

A short-term rating is an assessment of the likelihood of timely repayment of obligations that are considered short-term in the respective markets. Short-term ratings also range from 'A-1' for the highest quality obligations to 'D' for the lowest quality obligations. Ratings within the 'A-1' category may include a plus sign (+) to highlight stronger commitments in that category.

Apart from long-term ratings, Standard & Poor's has special ratings for preferred stocks, funds money market, mutual bond funds, the solvency of insurance companies and companies working with derivatives.

The company analyzes the capital markets of more than 110 countries.

Moody's uses two different rating systems, or scales, to value bonds. One of them - the global (international) scale Moody's (Moody's Global Scale) - is used to assign ratings to non-financial and financial institutions, sovereign and subsovereign issuers, and structured finance securities. The global scale establishes a correspondence between different rating categories and relative levels of the mathematical expectation of losses in different time periods. The mathematical expectation of losses includes an estimate of the probability of default and the expectation of losses at default.

As conceived by Moody's, the expected loss associated with a particular rating symbol and certain period time, should be the same for all debt obligations and issuers that have been assigned an appropriate rating on the global (international) scale. All of Moody's rating methodologies, rating practices and rating monitoring systems are designed to ensure consistency in ratings.

In addition, in order to meet the needs of investors, Moodys also assigns National Scale Ratings in certain jurisdictions, which are opinions about the relative creditworthiness of issuers and debt issues within a given country and cannot be used for comparison with ratings. assigned in other countries.

Fitch Ratings

Fitch Ratings is an international rating agency dedicated to providing global credit markets independent and forward-looking credit ratings, analytical studies and data. Employees of Fitch Ratings, working in 50 offices around the world, analyze the capital markets of more than 150 countries.

Fitch Ratings is headquartered in New York and London and is part of the Fitch Group. In addition to Fitch Ratings, the group includes Fitch Solutions, Fitch Ratings' products and services distribution arm, which provides information, analysis and related services. The Fitch Group also includes Algorithmics, a global leader in corporate risk management solutions. The Fitch Group is majority owned by Fimalac S.A., headquartered in Paris, France.

Fitch has been assigning international and national credit ratings to banks, non-banking financial institutions, insurance companies, corporate sector issuers, regional and local authorities, and sovereign governments for over 15 years. Fitch also rates fixed income debt issues and structured finance transactions.

Fitch credit ratings are an opinion on the relative ability of an issuer to meet its financial obligations, such as paying interest, paying dividends on preferred shares, repayment of the principal amount of the debt, settlement of insurance losses and fulfillment of counterparty obligations.

Fitch's credit ratings cover corporate, sovereign (including interstate and subnational entities), financial, banking and insurance issuers, municipalities and other entities within public finance, as well as securities and other obligations issued by such issuers, and, finally, structured finance instruments secured by accounts receivable or other financial assets.

Fitch Credit Ratings do not directly measure any risk other than credit risk. In particular, the ratings do not assess downside risks market value rated security due to a change interest rates, liquidity or other market factors. However, with regard to payment obligations for rated obligations, market risks may be considered to the extent that it affects the issuer's ability to make the necessary payments. Ratings do not reflect market risk in terms of its effect on the size or terms of the payment obligation (for example, in the case of index-linked bonds).

In the default components of the ratings of specific obligations or instruments, the agency, as a rule, takes into account the probability of non-payments or defaults based on the terms of the documentation of this instrument. AT individual cases taking into account special factors, Fitch may assign a rating at a higher or lower level than suggested by the notes' documentation. In such cases, the agency clearly indicates the basis for such an opinion in the relevant rating message.

The material was prepared on the basis of information from open sources