A credit rating assigned by ACRA is the Agency’s subjective opinion on the ability of a rated entity to fulfill its financial obligations (creditworthiness, financial reliability, financial stability) and/or on the credit risk of its individual financial obligations or financial instruments, expressed using a rating category.

ACRA assigns credit ratings in accordance with the following scales:

In addition to credit ratings, ACRA assigns non-credit ratings in accordance with the Agency’s current scales:

National Credit Rating Scale for the Russian Federation

The National Credit rating Scale for the Russian Federation is used exclusively to assign fundamental credit ratings and is not used to assign credit ratings to structured finance instruments and obligations.

The National Credit Rating Scale for the Russian Federation allows to compare only the credit ratings assigned by the Agency within the Russian Federation: comparing the credit ratings assigned by the Agency with the credit ratings of Russian obligations or with the credit ratings of other issuers operating in the Russian Federation or placing financial obligations in the Russian financial market.

In economic terms, credit ratings on the national scale assigned by ACRA can reflect the relative default probabilities or the expected loss rates of rated entities (or their securities) compared to the highest creditability level in the Russian economy, which, in ACRA’s opinion, pertains to obligations of the Russian government and a number of their derivatives.

Table 1. National Credit Rating Scale for the Russian Federation

Category

Rating

Description

AAA

AAA(RU)

Maximum creditability level assigned to rated entities, securities issues, or financial obligations. The highest credit rating under the national scale of the Russian Federation, according to the Agency. The credit rating of financial obligations of the Government of the Russian Federation.

AA

AA+(RU)

High creditability level compared to other rated entities, securities, or financial obligations in the Russian Federation; although, according to ACRA, slightly lower than AAA(RU).

AA(RU)

AA-(RU)

A

A+(RU)

Moderately high creditability level compared to other rated entities, securities or financial obligations in the Russian Federation; however, somewhat sensitive to adverse changes in the business, financial, and economic environment in the Russian Federation.

A(RU)

A-(RU)

BBB

BBB+(RU)

Moderate creditability level compared to other rated entities, securities, or financial obligations in the Russian Federation, with a higher sensitivity to adverse changes in the business, financial and economic environment in the Russian Federation.

BBB(RU)

BBB-(RU)

BB

BB+(RU)

Moderately low creditability level compared to other rated entities, securities, or financial obligations in the Russian Federation. Creditability is stable in the short term, but there is high sensitivity to adverse changes in the business, financial, and economic environment in the Russian Federation.

BB(RU)

BB-(RU)

B

B+(RU)

Low creditability compared to other rated entities, securities, or financial obligations in the Russian Federation. At this stage, the entity can still fulfil its debt obligations in a full and timely fashion but is highly vulnerable to unfavorable commercial, financial, and economic conditions in the Russian Federation.

B(RU)

B-(RU)

CCC

CCC(RU)

Very low creditability level compared to other rated entities, securities, or financial obligations in the Russian Federation. There is a possibility of failure by the rated entity to fulfil its debt obligations in the short term. Timely fulfillment of debt obligations is largely dependent upon a favorable commercial, financial, and economic environment in the Russian Federation.

СС

CC(RU)

Very low creditability level compared to other rated entities, securities, or financial obligations in the Russian Federation. There is a high probability of the Rated Entity defaulting on its debt obligations in the short term. Timely fulfillment of debt obligations hinges on a favorable external economic and financial environment in the Russian Federation, as well as on good creditor relations.

С

C(RU)

Very low creditability level compared to other rated entities, securities, or financial obligations in the Russian Federation. There is a high probability of the rated entity defaulting on its debt obligations in the short term. Timely fulfillment of debt obligations is highly unlikely without concessions from creditors.

SD

SD(RU)

The rated entity is in default on one of its financial obligations, but the Agency believes that the rated entity will continue to timely service its other financial obligations.

D

D(RU)

The rated entity is in default on its financial obligations.

Source: ACRA

Structured Finance Sector National Credit Rating Scale for the RussianFederation

In order to categorize credit ratings assigned to structured finance instruments and obligations in the Russian Federation, ACRA uses the structured finance sector national credit rating scale for the Russian Federation, which is an alphanumerical notation system.

Table 2. Structured Finance Sector National Credit Rating Scale for the Russian Federation

Category

Rating

Description

AAA

AAA(ru.sf)

Structured finance obligations or instruments with the AAA(ru.sf) rating are considered by the Agency to have the highest credit quality under the national scale for the Russian Federation, with minimal credit risk; the credit rating of financial obligations secured by the guarantee of the Government of the Russian Federation.

AA

AA+(ru.sf)

High level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation; however, as a rule, slightly lower than that of rated obligations and instruments with the AAA(ru.sf) credit rating.

AA(ru.sf)

AA-(ru.sf)

A

A+(ru.sf)

Moderately high level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation, but with some sensitivity to adverse changes in the business, financial and economic environment in the Russian Federation and to their impact on parameters of underlying assets, collaterals, and other assets securing rated structured finance obligations and instruments, as well as operating risks.

A(ru.sf)

A-(ru.sf)

BBB

BBB+(ru.sf)

Moderate level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation, but with a higher sensitivity to adverse changes in the business, financial and economic environment in the Russian Federation and to their impact on parameters of underlying assets, collaterals, and other assets securing the rated structured finance obligations and instruments, as well as operating risks.

BBB(ru.sf)

BBB-(ru.sf)

BB

BB+(ru.sf)

Moderately low level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation, with little to no risk of sharp deterioration in credit quality in the short term. However, displays higher sensitivity to adverse changes in the business, financial, and economic environment inside in the Russian Federation and to their impact on parameters of underlying assets, collaterals, and other assets securing the rated structured finance obligations and instruments, as well as operating risks.

BB(ru.sf)

BB-(ru.sf)

B

B+(ru.sf)

Low level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation. At this stage, the entity can still fulfil its debt obligations in a full and timely fashion; however, there it is highly vulnerable to adverse business, financial and economic conditions in the Russian Federation and their considerable impact on the parameters of underlying assets, collaterals, and other assets securing the rated structured finance obligations and instruments, as well as operating risks.

B(ru.sf)

B-(ru.sf)

CCC

CCC(ru.sf)

Very low level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation. There is a possibility of failure to fulfill rated obligations in the short term. Timely fulfillment of rated obligations depends on favorable business, financial, and economic conditions in the Russian Federation and their impact on the parameters of underlying assets, collaterals, and other assets securing the rated structured finance obligations and instruments, as well as measures to reduce operating risks.

СС

CC(ru.sf)

Very low level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation. There is an increased probability of default on rated obligations in the short term. Timely fulfillment of rated obligations depends on favorable business, financial and economic conditions in the Russian Federation and their impact on the parameters of underlying assets, collaterals, and other assets securing the rated structured finance obligations and instruments, as well as measures to reduce operating risks.

С

C(ru.sf)

Very low level of credit quality compared to other rated structured finance obligations and instruments in the Russian Federation. There is a high probability of default on rated obligations in the short term. Timely fulfillment of obligations is highly unlikely without attracting additional sources capable of improving credit quality and reducing operating risks.

D

D(ru.sf)

The rated financial obligation is in default.

Source: ACRA

National Credit Rating Scale for the Republic of Kazakhstan

ACRA’s national credit rating scale is used solely to assign fundamental credit ratings and not to assign credit ratings to structured finance instruments and obligations.

The National Credit Rating Scale for the Republic of Kazakhstan allows to compare only the credit ratings assigned by the Agency within the Republic of Kazakhstan: comparing the credit ratings assigned by the Agency with the credit ratings of Kazakh obligations or with the credit ratings of other issuers operating in the Republic of Kazakhstan or placing financial obligations in the Kazakh financial market.

In economic terms, credit ratings on the national scale assigned by ACRA can reflect the relative default probabilities or the expected loss rates of rated entities (or their securities) compared to the highest creditability level in the Kazakh economy, which, in ACRA’s opinion, pertains to obligations of the Government of the Republic of Kazakhstan and a number of their derivatives.

The credit rating of the Republic of Kazakhstan and its issued financial obligations on ACRA’s national scale for the Republic of Kazakhstan is set at AAA(KZ).

Table 3. National Credit Rating Scale for the Republic of Kazakhstan

Category

Rating

Description

AAA

AAA(KZ)

Maximum creditability level assigned to rated entities, securities issues, or financial obligations. The highest credit rating under the national scale of the Republic of Kazakhstan, according to the Agency. The credit rating of financial obligations of the Government of the Republic of Kazakhstan.

AA

AA+(KZ)

High creditability level compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan; although, according to ACRA, slightly lower than for rated entities, securities issues, or financial obligations rated AAA(KZ).

AA(KZ)

AA-(KZ)

A

A+(KZ)

Moderately high creditability level compared to other rated entities, securities or financial obligations in the Republic of Kazakhstan; however, somewhat sensitive to adverse changes in the business, financial, and economic environment in the Republic of Kazakhstan.

A(KZ)

A-(KZ)

BBB

BBB+(KZ)

Moderate creditability level compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan, with a higher sensitivity to adverse changes in the business, financial and economic environment in the Republic of Kazakhstan.

BBB(KZ)

BBB-(KZ)

BB

BB+(KZ)

Moderately low creditability level compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan. Creditability is stable in the short term, but there is high sensitivity to adverse changes in the business, financial, and economic environment in the Republic of Kazakhstan.

BB(KZ)

BB-(KZ)

B

B+(KZ)

Low creditability compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan. At this stage, the entity can still fulfil its debt obligations in a full and timely fashion but is highly vulnerable to unfavorable commercial, financial, and economic conditions in the Republic of Kazakhstan.

B(KZ)

B-(KZ)

CCC

CCC(KZ)

Very low creditability level compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan. There is a possibility of default on debt obligations in the short term. Timely fulfillment of debt obligations is largely dependent upon a favorable commercial, financial, and economic environment in the Republic of Kazakhstan.

СС

CC(KZ)

Very low creditability level compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan. There is a high probability of default on debt obligations in the short term. Timely fulfillment of debt obligations hinges on favorable external economic and financial environment in the Republic of Kazakhstan, as well as on good creditor relations.

С

C(KZ)

Very low creditability level compared to other rated entities, securities, or financial obligations in the Republic of Kazakhstan. There is a high probability of default on debt obligations in the short term. Timely fulfillment of debt obligations is highly unlikely without concessions from creditors.

SD

SD(KZ)

The rated entity is in default on one of its financial obligations, but the Agency believes that the rated entity will continue to timely service its other financial obligations.

D

D(KZ)

The rated entity is in default on its financial obligations.

Source: ACRA

International Credit Rating Scale

ACRA’s international credit rating scale is used solely to assign fundamental credit ratings and not to assign credit ratings to structured finance instruments and obligations.

ACRA’s international credit rating scale allows for comparing credit ratings assigned by the Agency under the international scale, at the supranational level.

ACRA may assign both local and foreign currency international scale credit ratings. Local currency international scale credit ratings do not take into account additional risks of restrictions on currency conversion needed to repay issuer’s obligations denominated in foreign currency.

In the economic terms, ACRA’s credit ratings assigned under the international scale can reflect the relative probability of default or the expected loss rates of rated entities or securities issues.

Table 4. International credit rating scale

Category

Rating

Description

AAA

AAA

The highest rating. An entity or an issue of securities or a financial obligation rated AAA demonstrates the maximum creditworthiness and the minimum sensitivity to unfavorable changes in business, financial and economic conditions, either domestic or international, and other external factors.

AA

AA+

High creditworthiness compared to other rated entities or issues of securities or financial obligations. Low sensitivity to unfavorable changes in business, financial and economic conditions, either domestic or international, and other external factors. In ACRA’s opinion, the rating is insignificantly lower than that of entities, securities issues, or financial obligations rated AAA.

AA

AA-

A

A+

Moderately high creditworthiness compared to other rated entities or issues of securities or financial obligations. Certain sensitivity to unfavorable changes in business, financial and economic conditions, either domestic or international, and other external factors.

A

A-

BBB

BBB+

Moderate creditworthiness compared to other rated entities or issues of securities or financial obligations. Higher sensitivity to unfavorable changes in business, financial and economic conditions, either domestic or international, and other external factors.

BBB

BBB-

BB

BB+

Moderately low creditworthiness compared to other rated entities or issues of securities or financial obligations. The creditworthiness is sustainable in the short-term, but there is high sensitivity to unfavorable changes in business, financial and economic conditions, either domestic or international, and other external factors.

BB

BB-

B

B+

Low creditworthiness compared to other rated entities or issues of securities or financial obligations. The rated entity is able to perform debt obligations when due and in full, but it is highly vulnerable to unfavorable business, financial and economic conditions, either domestic or international, and other external factors.

B

B-

CCC

CCC

Very low creditworthiness compared to other rated entities or issues of securities or financial obligations. The default on debt obligations is likely in the short term. Timely performance of debt obligations largely depends on favorable business, financial and economic conditions, either domestic or international, and other external factors.

СС

CC

Very low creditworthiness compared to other rated entities or issues of securities or financial obligations. The default on debt obligations is highly likely in the short term. Timely performance of debt obligations depends on favorable business, financial and economic conditions, either domestic or international, and other external factors, as well as on relations with creditors.

С

C

Very low creditworthiness compared to other rated entities or issues of securities or financial obligations. The default on debt obligations is highly likely in the short term. Timely performance of debt obligations is extremely unlikely without favorable attitude of creditors.

SD

SD

The rated entity is in default on one of its financial obligations. However, ACRA believes that the rated entity will continue to timely service other financial obligations.

D

D

The rated entity or financial obligation is in default.

Source: ACRA

International Short-term Credit Rating Scale

ACRA’s international short-term credit rating scale is used solely to assign fundamental credit ratings and not to assign credit ratings to structured finance instruments and obligations.

The international short-term credit rating scale allows for comparing credit ratings assigned by the Agency under the international scale, at the supranational level.

Table 5. International Short-term Credit Rating Scale

Category

Description

S1+

The rated entity has the maximum creditworthiness with respect to short-term (less than a year) obligations, and its access to liquidity and short-term funding demonstrates the minimum sensitivity to unfavorable changes in the financial and economic conditions (including those at the international level) and other factors.

S1

The rated entity has a high creditworthiness with respect to short-term (less than a year) obligations, and its access to liquidity and short-term funding demonstrates a weak sensitivity to unfavorable changes in the financial and economic conditions (including those at the international level) and other factors.

S2

The rated entity has a moderately high creditworthiness with respect to short-term (less than a year) obligations, and its access to liquidity and short-term funding may be sensitive to unfavorable changes in the financial and economic conditions (including those at the international level) and other factors.

S3

The rated entity has a moderate creditworthiness with respect to short-term (less than a year) obligations, and its access to liquidity and short-term funding is sensitive to unfavorable changes in the financial and economic conditions (including those at the international level) and other factors.

B

The rated entity has a moderately low creditworthiness with respect to short-term (less than a year) obligations, and its access to liquidity and short-term funding is exposed to unfavorable changes in the financial and economic conditions (including those at the international level) and other factors.

C

The rated entity has a very low creditworthiness with respect to short-term (less than a year) obligations; its obligations depend heavily on access to liquidity and short-term funding and favorable financial and economic conditions (including the support from international lenders) and other factors.

D

The rated entity or financial obligation is in default.

Source: ACRA

Correspondence between long-term and short-term credit ratings

Long-term rating

Short-term rating

AAA

S1+

 

 

 

 

 

 

AA+

 

 

 

 

 

 

AA

 

 

 

 

 

 

AA-

S1

 

 

 

 

 

A+

 

 

 

 

 

 

A

 

S2

 

 

 

 

A-

 

 

 

 

BBB+

 

 

 

 

 

 

BBB

 

 

S3

 

 

 

BBB-

 

 

 

 

 

 

BB+

 

 

 

 

B

 

 

BB

 

 

 

 

 

 

BB-

 

 

 

 

 

B+

 

 

 

 

 

 

B

 

 

 

 

 

 

B-

 

 

 

 

 

 

CCC

 

 

 

 

C

 

CC

 

 

 

 

 

 

C

 

 

 

 

 

 

D/SD

 

 

 

 

 

D

Source: ACRA

International Structured Finance Credit Rating Scale

In order to categorize credit ratings of structured finance instruments and obligations in different jurisdictions, ACRA applies its international structured finance credit rating scale, which is an alphanumerical notation system.

Table 6. International Structured Finance Credit Rating Scale

Category

Rating

Description

AAA

AAA.sf

The highest rating. Structured finance obligations or instruments rated AAA.sf are, in the Agency’s opinion, obligations and instruments of the highest credit quality with the lowest credit risk.

AA

AA+.sf

High credit quality compared to other rated structured finance obligations and instruments. Typically, it is slightly lower than obligations and instruments rated AAA.sf.

AA.sf

AA-.sf

A

A+.sf

Moderately high credit quality compared to other rated structured finance obligations and instruments, however, there is some sensitivity to adverse changes in commercial, financial or economic conditions (including those at the international level) and their impact on the performance of underlying assets, collateralized and other assets securing the rated structured finance obligations and instruments, as well as operational risks.

A.sf

A-.sf

BBB

BBB+.sf

Moderate credit quality compared to other rated structured finance obligations and instruments, however, there is elevated sensitivity to adverse changes in commercial, financial or economic conditions (including those at the international level) and their impact on the performance of underlying assets, collateralized and other assets securing the rated structured finance obligations and instruments, as well as operational risks.

BBB.sf

BBB-.sf

BB

BB+.sf

Moderately low credit quality compared to other rated structured finance obligations and instruments. There is almost no risk of sharp decline in the credit quality in the short term, however, there is high sensitivity to adverse changes in commercial, financial or economic conditions (including those at the international level) and their impact on the performance of underlying assets, collateralized and other assets securing the rated structured finance obligations and instruments, as well as operational risks.

BB.sf

BB-.sf

B

B+.sf

Low credit quality compared to other rated structured finance obligations and instruments. There is possibility to fulfill debt obligations when due and in full, but there is high vulnerability to adverse changes in commercial, financial or economic conditions (including those at the international level) and their impact on the performance of underlying assets, collateralized and other assets securing the rated structured finance obligations and instruments, as well as operational risks.

B.sf

B-.sf

CCC

CCC.sf

Very low credit quality compared to other rated structured finance obligations and instruments. There is a potential for default on the rated obligations in the short term. Timely fulfilment of rated obligations depends on favorable commercial, financial or economic conditions (including those at the international level) and their impact on the performance of underlying assets, collateralized and other assets securing the rated structured finance obligations and instruments, as well as operational risks mitigation measures.

СС

CC.sf

Very low credit quality compared to other rated structured finance obligations and instruments. There is an elevated likelihood of default on the rated obligations in the short term. Timely fulfilment of rated obligations depends on favorable commercial, financial or economic conditions (including those at the international level) and their impact on the performance of underlying assets, collateralized and other assets securing the rated structured finance obligations and instruments, as well as operational risks mitigation measures.

С

C.sf

Very low credit quality compared to other rated structured finance obligations and instruments. There is a high likelihood of default on the rated obligations in the short term. Timely fulfilment of rated obligations is extremely unlikely without additional sources of credit quality enhancement and operational risks mitigation measures.

D

D.sf

The rated entity or financial obligation is in default on its structured finance obligations.

Source: ACRA

NON-CREDIT RATING SCALES

National Asset Management Company Reliability Non-credit Rating Scale for the Russian Federation

In order to categorize the reliability of asset management companies operating in Russia or Russian financial markets, the Agency applies the national scale described below. Ratings assigned under this scale are not credit ratings or their components.

Table 7.  National Asset Management Company Reliability Non-Credit Rating Scale for the Russian Federation

Category

Rating

Description

AAA

AAA(ru.am)

Highest reliability. Very low sensitivity to changes in legislation, client base, or investor pool.

AA

AA+(ru.am)

AA(ru.am)

AA-(ru.am)

Very high reliability. Low sensitivity to changes in legislation, client base, or investor pool.

A

A+(ru.am)

A(ru.am)

A-(ru.am)

High reliability. Moderate sensitivity to changes in legislation, client base, or investor pool.

BBB

BBB+(ru.am)

BBB(ru.am)

BBB-(ru.am)

Sufficient reliability. Sufficient sensitivity to changes in legislation, client base, or investor pool.

BB

BB+(ru.am)

BB(ru.am)

BB-(ru.am)

Satisfactory reliability. Medium sensitivity to changes in legislation, client base, or investor pool.

B

B+(ru.am)

B(ru.am)

B-(ru.am)

Low reliability. High sensitivity to changes in legislation, client base, or investor pool.

CCC

CCC(ru.am)

Very low reliability. Very high sensitivity to changes in legislation, client base, or investor pool.

SD

SD(ru.am)

Unacceptably low reliability. The Bank of Russia has either ordered the asset management company to cease operating or limited its scope. Massive client outflow.

D

D(ru.am)

Bankruptcy or license withdrawal.

Source: ACRA

Sustainable Development Assessment Scales

https://www.acra-ratings.ru/about-ratings/assessment_scales/?lang=en

Contact persons

Sergey Kutenko
Managing Director, Head of Methodology Group
+7 (495) 139-0480, ext. 133


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