Announcements Criteria Rating Alerts

GCR Requests Public Comment on Draft Ratings Framework Criteria and Draft Ratings Definitions

Download – Request for Comment Criteria for the GCR Ratings Framework
Download – Request for Comment GCR Rating Scales Symbols and Definitions

Johannesburg, 12th March 2019: GCR has published two draft criteria proposing a new universal ratings framework and accompanying updated set of rating definitions.

The below reports are open to public comment until the 30th April 2019.

  1. Request for Comment: Criteria for the GCR Ratings Framework
  2. Request for Comment: GCR Rating Scales, Symbols & Definitions

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

    However, the “Request for Comment: Criteria for the GCR Ratings Framework” does not include the sector specific criteria such as the criteria for rating financial institutions, insurance companies, corporates and public sector ratings. Drafts of sector specific criteria shall be released for public comments the next two to three weeks.


  2. Proposed new elements within the GCR Ratings Framework includes the following:

    • The framework proposes to unify the analytical approach across most sectors, in order to improve transparency and comparability of GCR ratings,

    • GCRs framework proposes a unique and transparent analytical approach, which maps back to both international and national scale credit ratings.

    • GCR’s proposed new framework anchors an entity’s creditworthiness in its operating environment.

    • GCRs proposed group methodology unifies our approach to support and other credit linkages,

    • GCRs proposed ratings framework takes into account management and governance considerations,

    • GCR proposes a standardised approach for rating debt instruments.

  3. The report titled “Request for Comment: GCR Rating Scales, Symbols & Definitions’ provides an updated list of definitions and tables aligned to the proposed new framework. The major proposed changes include:

• Enhanced rating definitions.

• Folding the Claims Paying Ability Ratings into the Financial Strength Ratings for insurance companies.

• Introducing greater differentiation between default and near default situations.

GCR invites comment on the proposed framework and definitions from market participants. Comments can be sent to rfc@GCRratings.com, by 30th April 2019. GCR will continue to support all ratings on existing methodologies until such time as the proposed criteria and definitions come into force.

Analytical Contact

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

Download – Request for Comment Criteria for the GCR Ratings Framework
Download – Request for Comment GCR Rating Scales Symbols and Definitions

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