Échelle d'évaluation et définitions

EthiFinance Ratings’ Long-Term Credit Rating Scale

The credit ratings on this scale are a relative measure of the long-term creditworthiness of issuers or issues, from 15 months onwards. The credit risk is measured on a 22-grade rating scale that extends from AAA to D.

The rating scale below and their corresponding descriptions are applicable to all of EthiFinance Ratings' long-term issuer ratings regardless of the asset class. They are also used to rate specific long term debt issues.

INVESTMENT GRADE CATEGORY

Maximum creditworthiness.
An issuer or issue rated in this category displays a maximum capacity to honour its financial commitments.

Very High creditworthiness.
An issuer or issue rated in this category maintains an excellent capacity to honour its financial commitments even under adverse changes in the economic environment.

High creditworthiness.
An issuer or issue rated in this category displays a high capacity to honour its financial commitments. However, this rating may deteriorate under adverse changes in the economic environment more so than the higher rated categories.

Medium to High creditworthiness.
An issuer or issue rated in this category displays an adequate capacity to honour its financial commitments. However, this capacity is more likely to deteriorate under adverse changes in the economic environment than the higher rated categories.

NON-INVESTMENT GRADE CATEGORY

Medium creditworthiness.
This category is the first to incorporate speculative characteristics. As such, an issuer or issue rated in this category displays a medium capacity to honour its financial commitments constrained by exposure to adverse business, financial or economic conditions. The materialisation of these constraints could lead to a weakened capacity of the issuer or issue to meet its financial obligations.

Weak creditworthiness.
An issuer or issue rated in this category indicates that a material default risk is present but in the obligor may still display the capacity to honour its financial commitments in the short-term. However, adverse economic, financial, or business conditions will probably impair the issuer’s ability to meet its financial commitments.

Very Weak creditworthiness.
An issuer or issue rated in this category is undergoing problems in honouring its financial commitments and therefore relies on favourable economic and financial conditions.
This category denotes a heightened likelihood of default over the next 12 months.

NON-INVESTMENT GRADE CATEGORY

Extremely weak creditworthiness.
An issuer or issue rated in this category currently displays uncertainty in honouring its financial obligations with a high probability of missing some of its payments.
This category denotes a heightened likelihood of default over the next 6 months.

Exceptionally Low creditworthiness close to default.
An issuer or issue rated in this category displays a high risk of interrupting payments and entering default.
This rating is used when a default has been announced (a distressed exchange or equivalent) but has not yet happened. Default is expected to occur in a maximum time horizon of one month.

The issuer or issue is in a default situation (for further detail see our Default Definition).

For structured finance transactions, the above scale is also applicable. The ratings will be accompanied by a (sf) suffix to indicate that the instrument being rated belongs to the structured finance asset class. Consequently, this rating scale with the (sf) suffix is applicable to the various tranches of a collateralized security that an SPV issues depending on how the waterfall mechanism distributes amongst each of the tranches the funds generated by the underlying pool of assets.

EthiFinance Ratings’ Short-Term Credit Rating Scale

Following are EthiFinance Ratings’ rating definitions and the scale that is used for short-term ratings, and also applies to instruments that have a maturity of less than 15 months.

The rating scale below and their corresponding descriptions are applicable to all of EthiFinance Ratings' short-term issuer ratings for all asset classes except for structured finance and project finance transactions. They are also used to rate specific debt issues.

Very low short-term credit risk.
The issuer or issue displays the highest capacity for the payment of its short-term debt obligations.

Low short-term credit risk.
The issuer or issue displays a high capacity for the payment of its short-term obligations.

Moderate short-term credit risk.
The issuer or issue displays an adequate capacity for the payment of short-term obligations.

Medium short-term credit risk.
This rating is the first to incorporate speculative features. Ratings in this category display, under normal conditions a medium capacity to honour its financial commitments even though they incorporate credit weaknesses. Adverse business, financial or economic conditions could lead to an inadequate capacity of the issuer or issue to meet its financial obligations.

High short-term credit risk.
The issuer or issue displays a low capacity for the timely payment of short-term debt obligations, and maintains an increased risk compared with higher credit rating instruments.

Very high short-term credit risk.
The issuer or issue displays an insufficient capacity for the timely payment of short-term debt obligations. These issuers / instruments are susceptible to falling into default and may be undergoing in-or-out-of-court restructurings.

The issuer has defaulted on its short-term financial obligations partially or fully.

EthiFinance Ratings’ Short-Term Credit Rating Scale