Understanding Ratings
Ratings Process Overview
Morningstar DBRS provides independent credit ratings services for financial institutions, corporate and sovereign entities, and structured finance products and instruments. Credit ratings are forward-looking opinions about credit risk that reflect the creditworthiness of an entity or security. The Rating Committee process facilitates credit rating decisions, which are a collective assessment of Morningstar DBRS’ opinion rather than the view of an individual analyst. Credit ratings are based on sufficient information that incorporates both global and local considerations and the use of approved methodologies. They are independent of any actual or perceived conflicts of interest.
Methodologies and Criteria
Morningstar DBRS credit ratings are formed and disseminated based on established methodologies, models, and criteria (Methodologies) that apply to entities and securities that we rate, including corporate finance issuers, financial institutions, insurance companies, public finance and sovereign entities, and structured finance transactions. Morningstar DBRS Methodologies are periodically reviewed and updated by the team.
About Ratings
Rating Scales
Morningstar DBRS uses rating scales to assign and monitor credit ratings. Occasionally, rating scales may be retired or new rating scales introduced. Rating scales currently used by Morningstar DBRS, as well as historical scales and mapping documents, are set out below.
Structured finance credit ratings are denoted by the addition of an "(sf)" modifier, when applicable.
Rating Policies
Morningstar DBRS maintains a comprehensive range of rating policies to support the objectivity and integrity of its rating processes and to promote the transparency of its rating operations. These policies are reviewed on a regular basis and modified, as necessary, to ensure that they continue to meet these objectives.
Rating Studies
On an annual basis, Morningstar DBRS publishes rating studies about the historical default rates of its rating categories and whether the default rates have changed over time.
Bloomberg Expected Ratings
Morningstar DBRS has licensed to Bloomberg the authority to use Morningstar DBRS rating scales and associated trademarks in conjunction with Bloomberg's display of "Expected Ratings." Bloomberg designates an Expected Rating by an "e" after the rating code. Expected Ratings are not a Morningstar DBRS credit rating and do not indicate whether Morningstar DBRS will issue a rating. Expected Ratings are produced by Bloomberg to anticipate agency ratings that may be assigned and are based upon information from third party sources and/or the agency's established policy and practices. Bloomberg's expectation of a Morningstar DBRS rating is provided without any participation or prior review by Morningstar DBRS and may differ from any corresponding Morningstar DBRS rating.