Ratings assigned to banks and corporates are generally not higher than the ratings assigned by CI to the relevant sovereign government. However, it may be possible for an issuer with particular strengths and attributes such as inherent financial strength, geographically diversified cash flow, substantial foreign assets, and guaranteed external support, to be rated above the sovereign. Shadow sovereign ratings are not intended for publication and are used to ensure that sovereign risk factors are adequately reflected in the ratings of non-sovereign issuers. The following rating scale applies to both foreign currency and local currency ratings. Short-term ratings assess the time period up to one year.
Exceptional capacity for timely fulfilment of financial obligations and most unlikely to be affected by any foreseeable adversity. Extremely strong financial condition and very positive non-financial factors. Very strong capacity for timely fulfilment of financial obligations. Unlikely to have repayment problems over the long term and unquestioned over the short and medium terms. Adverse changes in business, economic and financial conditions are unlikely to affect the institution significantly.
Strong capacity for timely fulfilment of financial obligations. Possesses many favourable credit characteristics but may be slightly vulnerable to adverse changes in business, economic and financial conditions. Satisfactory capacity for timely fulfilment of financial obligations. Acceptable credit characteristics but some vulnerability to adverse changes in business, economic and financial conditions. Medium grade credit characteristics and the lowest investment grade category.
Capacity for timely fulfilment of financial obligations is vulnerable to adverse changes in internal or external circumstances. Capacity for timely fulfilment of financial obligations is very vulnerable to adverse changes in internal or external circumstances. Substantial credit risk is apparent and the likelihood of default is high. Considerable uncertainty as to the timely repayment of financial obligations. The obligor is under the regulatory supervision of the authorities due to its weak financial condition. The likelihood of default is extremely high without continued external support.
The obligor has failed to service one or more financial obligations but CI believes that the default will be restricted in scope and that the obligor will continue honouring other financial commitments in a timely manner. The obligor has defaulted on all, or nearly all, of its financial obligations. Highest capacity for timely repayment of short-term financial obligations that is extremely unlikely to be affected by unexpected adversities. Very strong capacity for timely repayment but may be affected slightly by unexpected adversities. Strong capacity for timely repayment that may be affected by unexpected adversities. Adequate capacity for timely repayment that could be seriously affected by unexpected adversities.
Inadequate capacity for timely repayment if unexpected adversities are encountered in the short term. AA” to “C” to indicate that the strength of a particular rated entity is, respectively, slightly greater or less than that of similarly rated peers. Outlook – expectations of improvement, no change or deterioration in a bank or corporate rating over the 12 months following its publication are denoted Positive, Stable or Negative. The time horizon for a sovereign rating outlook is longer, at 12-24 months. In economics, a local currency is a currency that can be spent in a particular geographical locality at participating organisations.
A regional currency is a form of local currency encompassing a larger geographical area. Complementary currency – is used as a complement to a national currency, as a medium of exchange, which is usually not legal tender. Community currency – a complementary currency used by a group with a common bond, such as residents of a locality, association, or members of a business or online community. Local currency – a complementary currency used in a locality. Regional currency – a local currency where the locality is a larger region.
Auxiliary currency, microcurrency, Eco-Money – less common synonyms for community or local currency. Private currency – a currency issued by an individual, business or non-governmental organization. Complementary currencies are a type of private currency. Sectoral currency – a complementary currency used within one economic sector, such as education or health care. The Wörgl experiment illustrates some of the common characteristics and major benefits of local currencies. Local currencies with negative interest rate or demurrage tend to circulate much more rapidly than national currencies.