Rating service

Rating Service

A company that evaluates preferred stocks and debt securities based on the likelihood of default. The ratings service provides an objective rating to the security; the rating is higher when the likelihood of default is lower. There are three main ratings services: Moody's, Fitch, and Standard & Poor's. Companies issuing new preferred stocks or debt securities pay one or more of the ratings services to have their securities rated. Banks are not allowed to invest in securities with ratings below a certain level. See also: Investment-grade, Junk.

Rating service.

A rating service, such as A.M. Best, Moody's Investors Service, or Standard & Poor's, evaluates bond issuers to determine the level of risk they pose to would-be investors.

Though each rating service focuses on somewhat different criteria in making its evaluation, the assessments tend to agree on which investments pose the least default risk and which pose the most.

These rating services also evaluate insurance companies, including those offering fixed annuities and life insurance, in terms of how likely a provider is to meet its financial obligations to policyholders.

References in periodicals archive ?
These NRSROs have assured policymakers that they have erected adequate firewalls between their rating service and advisory service operations.
This modification, announced in December 1990, required that an institution had to meet an IDC rating of 125 or better by July 1, 1991, without consideration of an institution's rating by the Thompson BankWatch rating service.
3i Infotech's PREMIA(TM) solution becomes ISO Rating Service compliant, and combined offering provides added functionality and benefits for insurers
The debentures have been rated A (low) by Dominion Bond Rating Service Limited and BBB+ by Standard & Poor's Rating Service.
MMG will integrate its existing front- and back-end systems, both developed in-house, with ISO Rating Service.
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ISO Rating Service is an operational rating platform with built-in access to ISO-validated rating information and automatic electronic rating updates insurers use to manage programs more efficiently and cost-effectively.
ePolicy Solutions will integrate the ISO Rating Service with RightRisk(TM), its enterprise policy administration software solution.
The ISO Rating Service, which incorporates ISO's rating information with powerful rating software and a robust rate-management toolset, will provide Amerisure with rating information and automated, ongoing rate maintenance and analysis for six ISO commercial lines in 50 states.
Merrill Lynch Canada Finance Company has received written confirmation that the notes issued under its medium term note program are rated "AA(low)", "A+", "Aa3" and "AA-" by Dominion Bond Rating Service Limited, Standard & Poor's Ratings Services, Moody's Investor Services, Inc.
If one rating service was required to defer to or use the opinion or ratings of another, it would materially decrease and impair the quality of discourse in the markets.
Standard & Poor's--Standard & Poor's Rating Services today placed its 'BBB+' rating on the class B notes issued by Paper Bond Ltd.

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