Moody’s

Moody’s Corporation is one of the world’s leading providers of financial and business services such as credit ratings, research, data and analytics, risk assessment software, and portfolio management solutions.

The history of the company’s creation is connected with the publication of the bulletin “Moody’s Analyzes of Railroad Investments,” issued by analyst John Moody in 1909, where the definitions of various rating categories were given.

Moody’s Corporation includes two divisions:

1) Moody’s Investors Service, one of the world’s most famous rating agencies, publishes credit ratings for a wide range of debt obligations and their issuers.

Moody’s Investors Service uses two different rating systems, or scales, to evaluate bonds and issuers. One of them — the international scale (Moody’s Global Scale) — is used to assign ratings to non-financial and financial institutions and sovereign and sub-sovereign issuers outside the United States of America, as well as structured finance securities.

Another rating system, the Moody’s US Municipal Scale, is used to assign ratings to state and local governments, non-profit organizations, and other related entities that place debt on the US tax-free bond market (i.e., bonds, the income from which is not taxed).

In addition, Moody’s also assigns National Scale Ratings to certain countries, which are opinions about the relative creditworthiness of issuers and debt issues within a given nation and cannot be used for comparison with ratings assigned in other countries.

Moody’s Investors Service publishes four groups of ratings:

1. Overall credit ratings;

2. Special (industry) ratings;

3. Country ceiling ratings;

4. Other non-credit ratings.

However, despite the diversity of Moody’s Investors Service ratings, 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 Moody’s Investors Service characterizes the issuer’s readiness to service its long-term debts on time and in full. 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 “Baa3” 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 “Ba1” and below.

A feature of the Moody’s Investors Service scale is that each rating from Aa to Caa is added a numerical modifier from 1 to 3. Modifier 1 indicates a higher quality within the category; modifier 3 indicates a lower one. Another feature is the lack of a “D” level in the scale — “default,” which S&P Global Ratings and Fitch Ratings have.

On the Cbonds site, you can view more than 2,500 long-term international ratings in foreign and national currencies assigned by Moody’s Investors Service .

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, Ukrainian Metinvest, Kazakh Altyn Bank, and Russian VTB Bank.

2) Moody’s Analytics — develops a wide range of products and services related to financial analysis (research, ratings, economic research, forecasts, etc.) for institutional participants in the global financial markets. As part of its business, the company also provides software solutions, training, and certification programs.