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TMI BlogGuidelines for Enhanced Disclosures by Credit Rating Agencies (CRAs)X X X X Extracts X X X X X X X X Extracts X X X X ..... Actions: A. SEBI, vide Circular dated November 01, 2016, had prescribed the standard format for press release regarding rating action by CRAs. While CRAs are required to monitor and analyse the relevant factors that affect the creditworthiness of an issuer and discuss the same in the rating notes considered by the rating committee for assignment of ratings, such relevant factors may also be suitably incorporated in the press release regarding the rating action. Accordingly, in order to enable investors to understand underlying rating drivers better and make more informed investment decisions, CRAs shall make the following specific disclosures in the section on Analytical Approach in the Press Release: a. When a rating factors in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. 3. Disclosure of Average Rating Transition Rates for long-term instruments A. Transition studies are central to evaluating the performance of a CRA and provide an insight on the stability of ratings over a period of time. In order to promote transparency and to enable the market to best judge the performance of the ratings, the CRA should publish information about the historical average rating transition rates across various rating categories, so that investors can understand the historical performance of the ratings assigned by the CRAs. B. Accordingly, CRAs shall publish their average one-year rating transition rate over a 5-year period, on their respective websites, which shall be calculated as the weighted average of tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... internal audit, mandated under Regulation 22 of the SEBI (Credit Rating Agencies) Regulations, 1999 and Circular SEBI/ MIRSD/CRA/Cir-01/ 2010 dated January 06, 2010, shall also cover adherence to the prescribed methodology for calculation of transition rates, as specified in Para 3. B. above and default rates, in line with Circular CIR/MIRSD/CRA/6/2010 dated May 3, 2010. 6. This circular is issued in exercise of the powers conferred by Section 11 (1) of Securities and Exchange Board of India Act, 1992 read with the provisions of Regulation 20 of SEBI (Credit Rating Agencies) Regulations, 1999, to protect the interest of investors in securities and to promote the development of, and to regulate, the securities market. Yours faith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Note: The left-hand column identifies ratings outstanding at the beginning of the year. Each row provides information on the migration pattern of those ratings by end of the year. ANNEXURE B Sharp rating actions in investment grade rating category (excluding non-cooperative issuers) S. No. Rating action Number of ratings 1. Number of rating downgrades of more than 3 notches 2. Number of downgrades to default from investment grade ratings 3. Number of rating upgrade ..... X X X X Extracts X X X X X X X X Extracts X X X X
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