Investment grade

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Investment grade

In the context of bond ratings, the rating level above which institutional investors have been authorized to invest.

Investment Grade

Describing a bond with a medium or high rating. Bonds rated Baa3 by Moody's or BBB- by S&P or Fitch. Investment-grade bonds are considered sufficiently low-risk that the law allows banks to invest in them. In addition to being low-risk, investment-grade bonds are low-return, greatly reducing the cost on the issuer. Most American Treasury and municipal bonds are investment-grade. See also: Junk, High-Rating.

Investment grade.

When a bond is rated investment grade, its issuer is considered able to meet its obligations, exposing bondholders to minimal default risk.

Most US corporate and municipal bonds are rated by independent services such as Moody's Investors Service and Standard & Poor's (S&P).

The ratings are based on a number of criteria, including the likelihood that the bond issuer will be able to make interest payments and repay the principal in full and on time.

The four categories of bonds rated BBB and higher by S&P or Baa and higher by Moody's are considered investment grade.

References in periodicals archive ?
Moreover, Nigerian banks were rated strongly in last year's Lafferty Bank Quality Ratings.
The group had recently ranked Capitec bank as the best bank in the world in its inaugural Bank Quality Rankings, despite the company's CEO not having a 'specialist banking qualification'.
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As our proxies for bank relationships we use six variables: a dummy variable (MULTIPLE) that equals one for firms with multiple-bank relationships, and zero otherwise; the number of banking relationships (NUM); the number of foreign-bank relationships (FNUM); the number of domestic-bank relationships (DNUM); the percentage of bank loans to total loans (BLR); and the reputation of the lending bank (REP), a proxy for bank quality.
Given that t is directly related to bank quality, this suggests that an increase in forbearance leads to more banks being disciplined.
He added: 'The great concern is that if small firms' see a reduction in bank quality in good economic times, what will happen when, or if, the UK experiences another credit crunch?
The developer is celebrating its 25th anniversary this year, having just won the Midland Bank Quality Service Award for the company's size category for the second year running.
The company, which celebrates its 25th anniversary this year, has been named Best National Housebuilder as well as winning the Midland Bank Quality Service Award for the second year running.
College of American Pathologists Outcomes Working Group, blood bank quality assurance questionnaire.
Have you ever been involved in completing bank quality surveys or participated in banks' phone call market surveys?