Credit ratings

Credit rating is a measure of creditworthiness of private entities, corporations, state or country. Credit ratings are calculated based on past and current financial history of the above market participants, as well as on the basis of estimates for the size of their property and to make financial obligations (debts). The main purpose of these estimates is giving potential lenders / investors view of the probability of timely payment of financial commitment. In recent years expanded the scope of credit ratings: they have applied for the establishment of new insurance premiums, to determine the lease of collateral and to determine the quality of new candidates for admission to employment.

The largest rating agencies are Moody's, Standard and Poor's and Fitch Ratings.

Credit ratings are relative, so it is important to take into account the specifics of a particular country, businesses and industries. Low credit ratings, of course are undesirable because evidence of a high probability of default. The largest rating agencies (who work in the world) are Moody's, Standard and Poor's and Fitch Ratings.

Credit rating Standard & Poor's has several advantages for issuers, investors, lenders and financial intermediaries. Providing independent, informed and authoritative opinion for the issuer credit rating helps to increase access to loans and other sources of capital, thereby increasing the financial flexibility of the issuer. Credit rating is an independent and reliable assessment of the creditworthiness of the issuer upon which market participants can make informed financial decisions. This may entail lower costs for the issuer's borrowing capacity. For those issuers who raise funds under the guarantee of third parties, the credit rating could reduce the cost of such guarantees or to more effectively raise funds without having to purchase the warranty.