Symbols & Definitions / Corporate debt Issue Ratings

Long-Term Ratings
MARC’s Long-Term Ratings are assigned to debt issues with maturities of more than one year. These debt ratings specifically assess the likelihood of timely repayment of principal and payment of interest over the term to maturity of such debts.

Investment Grade
AAA Indicates that the ability to repay principal and pay interest on a timely basis is extremely high.

AA indicates a very strong ability to repay principal and pay interest on a timely basis, with limited incremental risk compared to issues rated in the highest category.

A indicates the ability to repay principal and pay interest is strong. These issues could be more vulnerable to adverse developments, both internal and external, than obligations with higher ratings.

BBB The lowest investment grade category; indicates an adequate capacity to repay principal and pay interest. More vulnerable to adverse developments, both internal and external, than obligations with higher ratings.

Non-Investment Grade
BB While not investment grade, this rating suggests that likelihood of default is considerably less than for lower-rated issues. However, there are significant uncertainties that could affect the ability to adequately service debt obligations.

B Indicates a higher degree of uncertainty, and therefore, greater likelihood of default. Adverse developments could negatively affect repayment of principal and payment of interest on a timely basis.

C High likelihood of default, with little capacity to address further adverse changes in financial circumstances.

D The rating ‘D’ indicates an entity has defaulted on its rated financial obligations.

Note: Long-Term Ratings from AA to B may be modified by the addition of a plus (+) or minus (-) suffix to show relative standing within the major rating categories. Bank-guaranteed issues will carry a suffix (bg), corporate-guaranteed a (cg) and all other supports an (s) when such guarantees or supports give favorable effect to the assigned rating.

Short-Term Ratings
MARC’s Short-Term Ratings are assigned to specific debt instruments with original maturities of one year or less, and are intended to assess the likelihood of timely repayment of principal and payment of interest.

Investment Grade
MARC-1 The highest category; indicates a very high likelihood that principal and interest will be paid on a timely basis.

MARC-2 Indicates the ability to repay principal and pay interest is strong. These issues could be more vulnerable to adverse developments, both internal and external, than obligations with higher ratings.

MARC-3 While the degree of safety regarding timely repayment of principal and payment of interest is strong, the relative degree of safety is not as high as issues rated MARC-1.

Non-Investment Grade
MARC-4 The lowest category; regarded as non-investment grade and therefore speculative in terms of capacity to service principal and interest.

MARC-D The rating MARC-D indicates that an entity has defaulted on its rated short-term financial obligations.

Note: Short-Term Ratings will also carry a suffix (bg) for bank-guaranteed issues, (cg) for corporate-guaranteed issues and (s) for all other supports when such guarantees or supports give favorable effect to the assigned rating.