DBRS Publishes Criteria for the Treatment of Corporate Preferred Shares and Hybrids

DBRS has today released its updated criteria “Preferred Share and Hybrid Criteria for Corporate Issuers (Excluding Financial Institutions)”. The publication of this updated criteria is part of DBRS’s ongoing efforts to provide greater transparency as to how DBRS assesses the “equity weighting” that is given to a hybrid or preferred security in terms of adjusting certain key ratios. This update has not resulted in any outstanding rating or rating trend changes.

The criteria includes discussion on: (1) the four factors DBRS considers in assessing equity weighting, (2) an overview of the base requirements that must be dealt with before any equity weighting is considered, (3) a list of High, Medium and Low considerations employed in the assessment, (4) an outline of the six categories of equity weighting used by DBRS, and (5) comments related to ratings on the instruments themselves.

DBRS criteria and methodologies are publicly available on its website www.dbrs.com under Methodologies.