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Bond rating

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Bond rating
A rating based on the possibility of default by a bond issuer. The ratings range from AAA (highly unlikely to default) to D (in default). See: Rating, investment grade.

bond rating
The grading of a debt security with respect to the issuer's ability to meet interest and principal requirements in a timely manner. The three major rating servicesFitch, Moody's, and Standard & Poor'suse AAA as their highest rating and grade down through Bs and Cs. (D is used only by Fitch.) Debts rated AAA, AA, A, and BBB are considered investment-grade. Higher rated bonds provide lower returns, the price an investor pays for greater safety. Compare stock rating. See also interest coverage.

Bond rating. Independent agencies, such as Standard & Poor's (S&P) and Moody's Investors Service, assess the likelihood that bond issuers are likely to default on their loans or interest payments.

Ratings systems differ from one agency to another but usually have at least 10 categories, ranging from a high of AAA (or Aaa) to a low of D. Bonds ranked BBB (or Baa) or higher are considered investment-grade bonds.



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The preferred shares are rated Pfd-3 (High) by Dominion Bond Rating Service (DBRS) and P-3 (High) by Standard and Poor's (S&P).
If the increase isn't approved in the next several weeks, the municipal utility's bond rating will suffer and ratepayers will be socked with higher interest payments in the long term, DWP officials said.
There are financial advisors to handle the preliminaries, bond counsel for all the legal complexities, and--perhaps most crucial of all these days--the three bond rating agencies.
 
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