GCR Ratings has released a Frequently Asked Questions (“FAQ”) publication on Distressed Debt Exchanges (“DDEs”) and the related transition of the ratings of issuers that are in distress.
GCR Ratings has broadened its Commercial Property Sector Risk score base to include selected European territory groupings. Concurrently, GCR has also revised Spain’s Property Risk Score to 7.75, from 8.00 previously, amidst short-term uncertainty in the wake of the COVID-19 pandemic.
GCR Ratings is occasionally required to qualify credit ratings issued within specific markets or jurisdictions. This is in order to reflect any divergent or market related nuances which have the potential to detract from the comparability of GCR credit ratings across jurisdictions within which GCR provides credit rating services.
The criteria titled ‘Criteria for Fund Ratings’ predominantly applies to fixed income funds, including money market funds and other funds with portfolios that invest primarily in debt and debt like securities. Fund ratings (“f”) are not credit ratings. Therefore, they do not measure the relative ability of a fund to repay principal and/or interest in a timely manner. Rather, Fund Ratings indicate an opinion regarding the fund’s ability to preserve principal value under varying market conditions that may be affected by credit risk, interest rates, liquidity, as well as other market conditions.
The Insurance sector risk score (ranging from 0 to 15) is a key factor in the operating environment component score. The core of the GCR Ratings Framework is based on GCR’s opinion that an entity’s operating environment largely frames its creditworthiness.
The Financial Institutions sector risk score (ranging from 0 to 15) is a key factor in the operating environment component score. The core of the GCR Ratings Framework is based on GCR’s opinion that an entity’s operating environment largely frames its creditworthiness. As a result, the operating environment analysis anchors the underlying risk score for the GCR rating methodology.
GCR invites comment on the draft criteria presented and welcomes comments which may be sent to RFC@GCRratings.com, prior to the closing of the comment period on the 10th of July 2020. GCR will continue to support all ratings on existing methodologies until the new criteria is adopted.
GCR combines elements of the country risk and sectoral risk analysis, blended across countries for entities operating across multiple jurisdictions, to anchor an insurer to its current operating conditions.