Announcements Criteria

GCR Publishes New Ratings Framework Criteria and Ratings Scales, Symbols and Definitions

Johannesburg, 22 May 2019: GCR Ratings (‘GCR’) has published the following two documents explaining a new universal ratings framework and accompanying updated set of rating scales, symbols and definitions.

  • Criteria for the GCR Ratings Framework
  • Rating Scales, Symbols & Definitions

The documents are available for download at www.GCRratings.com/criteria.

Criteria for the GCR Ratings Framework

The criteria titled “Criteria for the GCR Ratings Framework” includes an overview of how the framework is designed and functions. It also comprises a country risk criteria, a group classification and support criteria and management and governance criteria, all of which are typically universally applicable across GCR ratings, with the exception of structured finance ratings.

New elements within the GCR Ratings Framework include the following:

  1. GCR’s framework unifies the analytical approach across most sectors, in order to improve transparency and comparability of GCR ratings,
  2. GCR’s framework adopts a unique and transparent analytical approach, which maps back to both international and national scale credit ratings.
  3. GCR’s framework anchors an entity’s creditworthiness in its operating environment.
  4. GCR’s group methodology unifies the approach to support and other credit linkages.
  5. GCR’s ratings framework takes into account management and governance considerations,
  6. GCR has adopted a standardised approach for rating debt instruments.

The “Criteria for the GCR Ratings Framework” is accompanied by sector-specific criteria, which explain the details of the application of the framework to ratings across sectors (excluding structured finance) such as financial institutions, insurance and corporate entities. Sector-specific criteria are available at www.GCRratings.com/criteria.

Rating Scales, Symbols & Definitions

The document titled “Rating Scales, Symbols & Definition”’ provides an updated list of definitions and tables aligned to the new framework. The major changes include:

  1. Enhanced rating definitions.
  2. Folding the Claims Paying Ability Ratings into the Financial Strength Ratings for insurance companies.
  3. Introducing greater differentiation between default and near default situations.

GCR previously invited comment on the framework and definitions from market participants. There have been no significant amendments to the documents based on feedback. Smaller changes to the documents include increased explanation regarding how the criteria/ framework is utilised, as well as various editing changes.

Analytical Contact

Marc Chadwick  
Chief Ratings Officer  
chadwick@GCRratings.com  
+27 11 784 1771  
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