Rating agencies are private companies that carry out consultancy activities but, mainly, assess the rating (value).
The rating is an assessment expressed by an external and independent entity, the rating agency, on the ability of a company to pay its debts or not. When a private company, or a state, issues bonds, the rating agencies express their opinion on the degree of solvency of the issuer.
The credit risk classification is expressed with the letter scale: triple A (AAA) indicates maximum capital security, D an investment at a loss.
Numerous factors contribute to the formation of the opinion, subject to periodic review, including opinions and qualitative considerations. Standard & Poor’s, Moody’s and Fitch Ratings dominate the rating market. They are considered among the most authoritative.
