Credit rating assignment and monitoring process
Regardless of whether issuance of the credit rating was initiated by the rated entity itself (solicited rating) or by EuroRating (unsolicited rating), an identical rating method is applied, and the process of assignment and future monitoring of the rating is basically carried out in the same manner.
Information obtained from the rated entity and/or from publicly available sources are collected in an ongoing manner and assessed in terms of their significance and adequacy to the credit risk assessment of the given entity. Collected data are subject to a periodical in-depth multi-aspect analysis carried out by EuroRating’s rating analysts, aiming at assigning the rating for the first time or at a periodical update of an already existing rating.
The result of the conducted analysis is a proposal of a given rating action (i.e. assigning the rating for the first time, maintaining or changing the level and/or the outlook of the assigned rating, or rating suspension or withdrawal) presented by the lead rating analyst appointed for the rated entity. This proposal is presented to a Rating Committee composed of several persons, which approves the undertaken rating actions through voting.
Prior to the publication of the information about an undertaken rating action, EuroRating informs the rated entity at least 24 hours in advance about the undertaken rating action, and if the rating level and/or its outlook changes, EuroRating provides the rated entity with justification with a description of the main factors influencing the given rating modification. This aims at allowing the analysed entity to report any factual errors in the agency's justification for the rating action. In case of solicited ratings, which are accompanied by rating reports, providing the analysed entity with the report in advance aims at allowing the entity to define the scope of information to be disclosed in the report and excluding the publication of any confidential information.
In case of public ratings, information about the assigned rating or its verification is published by EuroRating on the agency’s website (www.EuroRating.com). Assigning the rating for the first time or any change of its level (or outlook) may also be accompanied by EuroRating's publication of a relevant press release. In case of private ratings, which are not subject to publication, information about assigning or updating the rating is only provided to the rated entity and/or other authorized third parties.
The credit risk assessment process is continuous. EuroRating continuously monitors and analyses all incoming information, which may affect the economic and financial situation of rated entities. Formal updates of issued ratings are carried out on quarterly basis. Thanks to continuous monitoring, the verification of the issued rating may also be carried out ad hoc if the agency obtains information of high significance for the assessment of the credit risk of the rated entity.