ERM Glossary: Credit rating agency

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A credit rating agency (CRA) is a company that assigns credit ratings to issuers of certain types of debt obligations as well as to the debt instruments themselves. In most cases, the issuers of securities rated by such agencies are companies, special purpose entities, state and local governments, non-profit organisations or national governments issuing debt-like securities (bonds) that can be traded on a secondary market.


Credit ratings agencies may also rate portfolios, e.g. money market funds, but the ratings ascribed to these types of entities may not have the same meaning as the ratings they assign to debt instruments.


In the EU, credit rating agencies are often referred to as external credit assessment institutions (ECAIs).


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