Bond Rating – IFXBG
Bonds require a high-grade rating to indicate the quality of the security. There are several different private independent rating services such as Standard & Poor’s, Moody’s and Fitch. Generally this is related to the ability to pay the coupons, principal, and interest in a timely fashion. In order to get an effective rating, the collateral required to make the bond needs to have a third-party valuation, financials, prospectus, etc. The rating has to do with the evaluations of a bond issuer’s financial strength.
Formally, bond experts will create bonds with a rating for insight to the investors as to the worthiness and investment grade of the security. Investors rely on these ratings as to the “marketability� and “liquidity� of the investment in comparison to unrated bonds which do not give indication of security and quality. Bonds are rated as letters ranging from ‘AAA’, which is the highest grade, to ‘C’ (“junk”), which is the lowest grade. Different rating services use the same letter grades, but use various combinations of upper- and lower-case letters to differentiate themselves.
The Bonds developed by our corporate bond advisors are considered High credit-quality investment Grade. Thus it implied liquidity and marketability of the security for the investors and business. Creating a bond is similar to listing a company on the stock exchange, accept instead of equity you are listing the debt of the company or debt which can finance the company or project.
The format of bonds created are all investment grade.
AAA and AA: High credit-quality investment grade
AA and BBB: Medium credit-quality investment grade
Any Bond with a lower rating is considered “Junk Bonds� such as the BB – C.
Junk bonds still have value from the perspective that “debt� supersedes equity in the roll-up of a firms assets and dissolving of companies. Therefore, bonds still carry value after the issuance even in the event of default.
If the bond rating is good, the company is strong enough to pay its obligations, which include expenses, payments on debts, and dividends. If a bond rating agency gives the company a high rating (or if it raises the rating), that’s a great sign for anyone holding the company’s debt or receiving dividends.
IFXBG corporate analysts and consortium members cover institutions, debt instruments, securitization firms, debts, all across wide range of sectors including Aviation, Oil and Gas, Mining, Manufacturing, Technology, Banking, Financial services, Insurance, Pharmaceutical, Retail, Chemicals, Power, Energy, Health care, Forestry, Automotive, Media and Real Estate. The consortium of International Financial Exchange and Banking Group define a set group of documents and information sets that supplied by the issuer. Prior to the valuation report, IFXBG can inform the firm of the potential value of the firm and assets, and likelihood of an investment grade rating. For your free pre-valuation and analysis, please contact us to see if you qualify for Bond creation, Valuation, and listing your firms debt or equity, contact [email protected]
IFXBG’s expert bond and corporate finance consortium addresses over 100 countries listing requirements, regulations, market environments and debt structures for public and private listing of debt instruments and their ratings. With state of the art clearing and issuer services attached to a European Standard of clearing and an international network of linked partners.
The IFXBG Consortium endeavors to create the highest liquidity globally, where by the collaboration among member companies allow for strategic positioning, placement, and performance of bond formation.
In the dynamic industry of bond formation, credit rating is a key aspect, as is clearing and settlement. If you are looking for services for bond formation, credit rating, clearing and settlement of investment grade bonds, contact [email protected].