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CREDIT RATING AGENCY

Credit Rating Agency (CRA)
CRA is a company that assigns credit rating which rates a
A. Debtors’ ability
1. To pay back debt by making timely interest payments and
2. The likelihood of default
B. Creditors’ worthiness of issuers of
1. Debt obligation
2. Debt instruments


Issuers of debt obligations include
1. Companies
2. Centre, state or local government
3. Sovereign government
4. NGOs
5. Special purpose entities


Debt instruments include:
1. Government bonds
2. Corporate bonds
3. Municipal bonds
4. Preferred stock
5. CDs
6. Mortgage- backed securities
7. Collateralized debt obligations


Important CRAs
1. Standard & Poor’s (S&P) – Headquarter – New York, US
2. Moody’s – Headquarter – New York, US
3. Fitch – Headquarter – New York, US
4. CRISIL – Credit Rating Information Services of India Limited – Headquarter – Mumbai
5. ICRA - Investment information and credit rating agency – Headquarter – Gurgaon, Haryana
6. CARE – Credit Analysis and Research – Headquarters – Mumbai
7. SMERA – Headquarters – Mumbai
8. Fitch (India Ratings & Research) – Headquarters – Mumbai

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