Standard & Poor's (S&P)

Standard & Poor's (S&P) is one of the world's preeminent providers of credit ratings, indices, risk evaluation,
investment research and data. It also provides a wide range of other products and services designed to help
individuals and institutions make better-informed financial decisions. Range of services provided by Standard &
Poor's include advice on asset allocation, portfolio strategies, fund recommendations and research. 

Standard and Poors was formed in 1941 with the merger of Standard Statistics and Poor's Publishing Company.
Standard and Poor's has an unrivalled depth and breadth in coverage and analysis. Standard & Poor's has the
world's largest network of credit ratings analysts. Over $1 trillion in investors' assets is directly tied to S&P indexes -
more than all other index providers combined. Standard & Poor's indices include the premier U.S. portfolio index, the
S&P 500. 

Standard & Poor's has a long history of creating standards for the financial industry. S&P has several firsts to its
credit. Standard & Poor's was the first to rate Securitized financings, Bond insured transactions, Letters of credit, The
financial strength of non-U.S. insurance companies, Bank holding companies, Financial guaranty companies. 

Standard & Poor's issues credit ratings for the debt of corporations, be they public or private. It has been designated
a Nationally Recognized Statistical Rating Organization by the U.S. Securities and Exchange Commission. S&P
issues both short-term and long-term credit ratings. 

Long-term credit ratings

S&P rates borrowers on a scale from AAA to D 

Investment Grade

 AAA: the best quality borrowers, reliable and stable

 AA: quality borrowers, a bit higher risk than AAA
 A: economic situation can affect finance
 BBB: medium class borrowers, which are satisfactory at the moment
 Non-Investment Grade (also known as junk bonds)
 BB: more prone to changes in the economy
 B: financial situation fluctuates noticeably
 CCC: currently vulnerable and dependent on favorable economic conditions to meet its commitments
 CC: highly vulnerable, very speculative bonds
 C: highly vulnerable, perhaps in bankruptcy or in arrears but still continuing to pay out on obligations
 CI: past due on interest
 R: under regulatory supervision due to its financial situation
 SD: has selectively defaulted on some obligations
 D: has defaulted on obligations is likely to default on most or all obligations
 NR: not rated

Short-term issue credit ratings 

S&P rates specific issues on a scale from A-1 to D. The ratings indicate that the issuer's commitment to meet its
obligations. Country risk and currency of repayment of the obligor to meet the issue obligation are factored into the
credit analysis and reflected in the issue rating.
 A-1: obligor's capacity to meet its financial commitment on the obligation is strong
 A-2: is susceptible to adverse economic conditions however the obligor's capacity to meet its financial
commitment on the obligation is satisfactory
 A-3: adverse economic conditions are likely to weaken the obligor's capacity to meet its financial
commitment on the obligation
 B: The obligor currently has the capacity to meet its financial obligation but faces major ongoing
uncertainties that could impact its financial commitment on the obligation
 C: currently vulnerable to nonpayment and is dependent upon favourable business, financial and economic
conditions for the obligor to meet its financial commitment on the obligation
 D: is in payment default. The rating is also used upon the filing of a bankruptcy petition