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NAME              ROLL NO.
    PRIYANK DARJI     06
    HARDIK NATHWANI   27
    SHASHANK PAI      28
    SAGAR PANCHAL     29
    DHARMIK PATEL     32
    KUSH SHAH         39

3
    SIDDARTH TAWDE    46
 The first mercantile credit agency was set up in New York
  in 1841 to rate the ability of merchants to pay their financial
  obligations. Later on, it was taken over by Robert Dun. This
  agency published its first rating guide in 1859.
 India was perhaps the first amongst developing countries
  to set up a credit rating agency in 1988.
 With the increasing market orientation of the Indian
  economy, investors value a systematic assessment of two
  types of risks, namely “business risk” arising out of the
  “open economy” and linkages between money, capital and
  foreign exchange markets and “payments risk”.

                                                                    4
 According to S&P “Credit ratings help
 investors by providing an easily
 recognizable, simple tool that couples
 a possibly unknown issuer with an
 informative and meaningful symbol
 of credit quality”

 According to Moody's “ A rating is an
 opinion on the future ability and legal
 obligation of the issuer to make
 timely payments of principal and
 interest on a specific fixed income
 security.
                                           5
 To compare the loan on the basis
  of quality of credit and loan.
 Credit rating agencies also assist
  to portfolio monitoring
 Credit Rating Credit quality of
  transparency.
 Credit rating of money market
  securities.


                                       6
7
 Helps in Investment Decision


 Choice of Instrument


 Saves Investor's Time and
 Effort



                                 8
 Improves Corporate Image


 Wider Audience for Borrowing


 Helps in Growth and Expansion




                                  9
10
 CRISIL was set up in the year 1987.
 It was set up in order to rate the firms and then entered
  into the field of assessment service for the banks.
 The head office of the company is located at Mumbai and it
  has established offices outside India also.
 CRISIL is a global analytical company providing ratings,
  research and risk and policy advisory services.
 CRISIL is the largest credit rating agency in India.
 CRISIL’s majority shareholder is STANDARD and
  POOR’s.
                                                               11
12
CONT.......
2) ICRA: ICRA Limited (formerly Investment Information
and Credit Rating Agency of India Limited) was set up in
1991 by leading financial/investment institutions,
commercial banks and financial services companies as an
independent and professional Investment Information and
Credit Rating Agency.
ICRA's five point IPO Grading Scale
IPO Grade 5 Strong fundamentals
IPO Grade 4 Above-average fundamentals
IPO Grade 3 Average fundamentals
IPO Grade 2 Below-average fundamentals
IPO Grade 1 Poor fundamentals
                                                         13
3) CARE ((Credit analysis and research limited))

CARE Ratings commenced operations in April 1993 and over
nearly two decades, it has established itself as the second-
largest credit rating agency in India. With the rating volume
of debt of around Rs.33,062 bn (as on June 30, 2011).

4) DCR(Duff & Phelps credit rating india limited)

It was founded in 1932 to provide high quality investment
research services focused on the utility industry. Over the
decades, it evolved into a diversified financial services firm
that provides financial advisory, investment banking, credit
rating and investment management services.
                                                            14
 CRAs should maintain records of the rating
  committee.
 Information about the historical default rates of their
  rating categories.
 CRAs should ensure that its analysts do not participate
  in any kind of marketing and business development.
 CRAs while rating structured finance products, are
  barred from providing consultancy or advisory services
  regarding the design of the structured finance
  instrument.
                                                            15
 Credit rating is an input for decision making.
 A credit rating is not a recommendation to buy, hold
  or sell a security. A rating is one of the inputs that is
  used by investors to make an investment decision.
 Investors expect higher returns for lower rated
  instruments.
 Rating agencies do not comment on the return being
  offered on a security. Also, investors use several other
  factors like level of portfolio diversification and
  liquidity levels of the security etc. in making
  investment decisions.

                                                              16
17

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Credit rating agency(cra) ppt

  • 1. 1
  • 2. 2
  • 3. NAME ROLL NO. PRIYANK DARJI 06 HARDIK NATHWANI 27 SHASHANK PAI 28 SAGAR PANCHAL 29 DHARMIK PATEL 32 KUSH SHAH 39 3 SIDDARTH TAWDE 46
  • 4.  The first mercantile credit agency was set up in New York in 1841 to rate the ability of merchants to pay their financial obligations. Later on, it was taken over by Robert Dun. This agency published its first rating guide in 1859.  India was perhaps the first amongst developing countries to set up a credit rating agency in 1988.  With the increasing market orientation of the Indian economy, investors value a systematic assessment of two types of risks, namely “business risk” arising out of the “open economy” and linkages between money, capital and foreign exchange markets and “payments risk”. 4
  • 5.  According to S&P “Credit ratings help investors by providing an easily recognizable, simple tool that couples a possibly unknown issuer with an informative and meaningful symbol of credit quality”  According to Moody's “ A rating is an opinion on the future ability and legal obligation of the issuer to make timely payments of principal and interest on a specific fixed income security. 5
  • 6.  To compare the loan on the basis of quality of credit and loan.  Credit rating agencies also assist to portfolio monitoring  Credit Rating Credit quality of transparency.  Credit rating of money market securities. 6
  • 7. 7
  • 8.  Helps in Investment Decision  Choice of Instrument  Saves Investor's Time and Effort 8
  • 9.  Improves Corporate Image  Wider Audience for Borrowing  Helps in Growth and Expansion 9
  • 10. 10
  • 11.  CRISIL was set up in the year 1987.  It was set up in order to rate the firms and then entered into the field of assessment service for the banks.  The head office of the company is located at Mumbai and it has established offices outside India also.  CRISIL is a global analytical company providing ratings, research and risk and policy advisory services.  CRISIL is the largest credit rating agency in India.  CRISIL’s majority shareholder is STANDARD and POOR’s. 11
  • 12. 12
  • 13. CONT....... 2) ICRA: ICRA Limited (formerly Investment Information and Credit Rating Agency of India Limited) was set up in 1991 by leading financial/investment institutions, commercial banks and financial services companies as an independent and professional Investment Information and Credit Rating Agency. ICRA's five point IPO Grading Scale IPO Grade 5 Strong fundamentals IPO Grade 4 Above-average fundamentals IPO Grade 3 Average fundamentals IPO Grade 2 Below-average fundamentals IPO Grade 1 Poor fundamentals 13
  • 14. 3) CARE ((Credit analysis and research limited)) CARE Ratings commenced operations in April 1993 and over nearly two decades, it has established itself as the second- largest credit rating agency in India. With the rating volume of debt of around Rs.33,062 bn (as on June 30, 2011). 4) DCR(Duff & Phelps credit rating india limited) It was founded in 1932 to provide high quality investment research services focused on the utility industry. Over the decades, it evolved into a diversified financial services firm that provides financial advisory, investment banking, credit rating and investment management services. 14
  • 15.  CRAs should maintain records of the rating committee.  Information about the historical default rates of their rating categories.  CRAs should ensure that its analysts do not participate in any kind of marketing and business development.  CRAs while rating structured finance products, are barred from providing consultancy or advisory services regarding the design of the structured finance instrument. 15
  • 16.  Credit rating is an input for decision making.  A credit rating is not a recommendation to buy, hold or sell a security. A rating is one of the inputs that is used by investors to make an investment decision.  Investors expect higher returns for lower rated instruments.  Rating agencies do not comment on the return being offered on a security. Also, investors use several other factors like level of portfolio diversification and liquidity levels of the security etc. in making investment decisions. 16
  • 17. 17