S&P

S&P Global is one of the world’s leading providers of financial and business services, such as independent credit ratings, analytics on global capital markets and commodities, and analytical information on economic, market, and business considerations. The company also develops the Dow Jones and S&P 500 indices.

The founding date of this company is considered to be 1860, when Henry Varnum Poor’s study “The History of Railroads and Canals of the United States of America” was published. This work was the first to collect all the information about the financial and operational conditions of the US railroad companies. It was Henry Poor who discovered the problem faced by investors concerning a lack of quality information. Therefore, to solve this problem, in 1916, Standard & Poor’s began to assign credit ratings, providing investors and other participants in the global market with the results of an independent analysis of credit risks.

S&P Global has four main business lines:

1) S&P Global Ratings is the core business of the entire group, accounting for about half of all revenue. S&P Global Ratings assigns credit ratings to issuers and their issued debt. The Agency evaluates the creditworthiness of the research object, after which it is assigned a rating that characterizes the degree of risk of default on credit obligations or obligations to investors.

S&P Global Ratings assigns two types of ratings: international and national. At the same time, the international credit ratings of the S&P Global Ratings agency are divided into long-term and short-term categories. However, in accordance with the Cbonds methodology, only data on long-term credit ratings of companies and debt securities on international and national scales are published on the Cbonds site.

The long-term credit rating of S&P Global Ratings characterizes the issuer’s readiness to service its long-term debts on time and in full. Letters are used to designate this: the AAA score corresponds to the highest reliability, and the D score to a default. Long-term ratings are divided into two categories: investment and speculative.

The term “investment grade” is also widely used to refer to issuer and debt ratings with relatively high levels of creditworthiness and credit quality; such ratings include ‘BBB-’ and above.

The term “non-investment” or “speculative” generally refers to securities whose issuer is currently able to meet its financial obligations but faces significant uncertainty (associated, for example, with the possibility of a deterioration in business or financial conditions) that could adversely affect the level of credit risk; such ratings include the level of “BBB-” and below.

However, it is also worth noting that the “D” level is classified by some as a separate third “default” category.

The national scales supported by Standard & Poor’s (including the Russian one) are designed for investors operating in national markets. These scales provide an opportunity to better distinguish the ability of issuers to service debts since they exclude a number of sovereign risks that are equally inherent to all issuers in this market segment. They reflect national specifics, so it makes no sense to compare S&P Global Ratings for different countries or to compare ratings on international and national scales.

On the Cbonds site, you can view more than 2,500 long-term international ratings in foreign and national currencies assigned by S&P Global Ratings.

At the same time, long-term ratings on the national scale of Kazakhstan, Russia, and Ukraine are also published on the Cbonds site; for example, the Ukrainian Bank Alliance, the Kazakh ForteBank, and the Russian VTB Bank.

In addition to credit ratings, S&P evaluates the management of companies. To do this, the agency has developed two systems: “Corporate Governance Rating” and GAMMA — the assessment of non-financial risks associated with the purchase of shares in companies in emerging markets.

2) Global Market Intelligence. Provider of multi-asset data, research, news, and analytics to investment managers, investment banks, private equity firms, insurance companies, commercial banks, and other organizations.

3) S&P Global Platts. Leading independent provider of information and benchmark price estimates for commodities and energy markets.

4) S&P Dow Jones Indices. The world’s largest global resource for index-based concepts, data, and research. Developer of the S&P 500 stock indices and the Dow Jones industrial index.