A credit rating is an assessment published by a credit rating agency of the creditworthiness of a financial entity (issuer rating) or a particular financial instrument (issue rating). Users of credit ratings typically include institutional and individual investors, lenders, and public regulators. Credit ratings are not to be confused with credit scores assigned by consumer reporting agencies to represent the creditworthiness of individual consumers. Credit rating agencies assign credit ratings to private entities (corporations and financial institutions) and public entities (municipalities, states, sovereign governments, and supranational entities) operating domestically or internationally. Rated instruments include, among other things, bonds, commercial paper, bank deposits, loans, and structured debt instruments.

The value added of credit rating agencies is to produce independent credit analysis. Credit ratings are calculated as the ...

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