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TMI BlogStandardisation of Rating Symbols and DefinitionsX X X X Extracts X X X X X X X X Extracts X X X X ..... tion Advisory Committee of SEBI. The Committee recommended that the rating symbols and their definitions should be standardised. 4. Pursuant to the above, in consultation with the CRAs and considering the international practices, standardised symbols and their definitions have been devised for the following: a) Long term debt instruments; b) Short term debt instruments; c) Long term structured finance instruments; d) Short term structured finance instruments; e) Long term mutual fund schemes; and f) Short term mutual fund schemes. 5. The new symbols and definitions as given in Annexures 1-6 shall henceforth be used for the new ratings/ reviews by the CRAs. 6. For existing outstanding ratings, the CRAs shall: (i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk. AA - Instruments with this rating are considered to have high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk. A - Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk. BBB - Instruments with this rating are considered to have moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk. BB - Instruments with this rating are considered to have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is rating are considered to have minimal degree of safety regarding timely payment of financial obligations. Such instruments carry very high credit risk and are susceptible to default. D - Instruments with this rating are in default or expected to be in default on maturity. Modifier { + (plus)} can be used with the rating symbols for the categories A1 to A4. The modifier reflects the comparative standing within the category. ANNEXURE 3 III. Rating Symbols and Definitions for Long Term Structured Finance Instruments Long term structured finance instruments: The instruments with original maturity exceeding one year Rating symbols should have CRA s first name as prefix AAA (SO) - Instrumen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions for Short Term Structured Finance Instruments Short term structured finance instruments : The instruments with original maturity of upto one year Rating symbols should have CRA s first name as prefix A1 (SO) Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligation. Such instruments carry lowest credit risk. A2 (SO) - Instruments with this rating are considered to have strong degree of safety regarding timely payment of financial obligation. Such instruments carry low credit risk. A3 (SO) - Instruments with this rating are considered to have moderate degree of safety regarding timely payment of financial obligation. Such instrument ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the investments that they have made. BBmfs - Schemes with this rating are considered to have moderate risk of default regarding timely receipt of payments from the investments that they have made. Bmfs - Schemes with this rating are considered to have high risk of default regarding timely receipt of timely receipt of payments from the investments that they have made. Cmfs - Schemes with this rating are considered to have very high risk of default regarding timely receipt of timely receipt of payments from the investments that they have made. Modifiers { + (plus) / - (minus)} can be used with the rating symbols for the categories AAmfs to Cmfs . The modifiers reflect the comparative standing within the category. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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