Rating

Published ranking of a debtor's or issuer's credit quality, or guarantor based on detailed financial analysis by one of the major three ratings agencies, Standard & Poor's Corporation, Moody's or Fitch ratings. The ranking is based on an evaluation of creditworthiness provided to the debt instrument, institution, or guarantor by credit rating agencies like. The credit assessment is specifically related to an entity's ability to meet its debt obligations. The ratings are qualitative indicators of credit risk, i.e. , the ability of issuers (or guarantors) to repay their borrowings. The exact definition differs slightly across rating agencies. Ratings are used by lenders to decide on approval of credit applications, and also to determine the regulatory capital backing required to cover a lender's exposure.