What is Moody’s rating scale?
The company ranks the creditworthiness of borrowers using a standardized ratings scale which measures expected investor loss in the event of default. … In Moody's Investors Service's ratings system, securities are assigned a rating from Aaa to C, with Aaa being the highest quality and C the lowest quality.
What is a B3 rating?
Moody's assigns its B3 rating for “obligations considered speculative and subject to high credit risk.”1 Entities that receive this rating may be experiencing financial instability or hold inadequate cash reserves relative to their business needs, debt or other financial obligations.
What is a Moody’s A2 rating?
Financial Terms By: a. A2. The sixth highest rating in Moody's Long-term Corporate Obligation Rating. Obligations rated A2 are considered upper-medium grade and are subject to low credit risk. Rating one notch higher is A1.
What does a Baa1 Moody’s rating mean?
Baa1. The eighth highest rating in Moody's Long-term Corporate Obligation Rating. Obligations rated Baa1 are subject to moderate credit risk. They are considered medium grade and as such may possess certain speculative characteristics. Rating one notch higher is A3.
How does Moody’s rating work?
Political uncertainty can trigger a sovereign rating downgrade. In August 2011, S&P cut the highest rating (AAA) of the US citing rising debt levels and political risks. … India's sovereign credit rating from Moody's is now Baa2, with the outlook cut from 'stable' to 'negative'.
What is a rating modifier?
The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.
What is a single B rating?
Credit ratings for bonds below these designations ("BB," "B," "CCC," etc.) are considered low credit quality, and are commonly referred to as "junk bonds." … An investment-grade credit rating indicates a low risk of a credit default, making it an attractive investment vehicle—especially to conservative investors.