Short definitions of the terms that appear in Indian rating press releases and in the regulation around them. Each entry is written to be read on its own, and each links to the related terms and to the guide where the term is used in context.
These are definitions of other parties’ terminology — SEBI’s, the RBI’s, and the rating agencies’ own. None of them is a TatvaRatings term.
A–Z
- Bank loan rating — a rating on a borrower’s bank facilities rather than on a market instrument.
- Commercial paper — unsecured short-term money-market paper issued at a discount, rated on the short-term A1 to D scale.
- Consortium lending — several banks lending to one borrower under a common agreement, with a designated lead bank.
- Credit enhancement — a support feature lifting an obligation’s rating above the obligor’s standalone credit; the (CE) suffix.
- ECAI — the RBI’s term for a rating agency whose ratings banks may use for capital computation.
- Issuer not cooperating — a tag marking a rating maintained without current issuer information, on best available data.
- Large exposures framework — the RBI’s cap on a bank’s exposure to one counterparty or connected group.
- Lender-wise annexure — the table mapping each rated bank facility to the named bank providing it.
- Multiple banking — separate bilateral facilities from several banks, with no common agreement and no lead bank.
- Non-convertible debenture — a corporate debt instrument paying interest and repaying principal, with no right of conversion.
- Provisional rating — a rating assigned on the assumption that specified documentation or structure will be put in place.
- Rating outlook — the agency’s medium-term directional view on a long-term rating, most often Positive, Stable or Negative.
- Rating rationale — the reasoning an agency publishes alongside a rating action, and the document carrying it.
- Rating watch — a flag that a specific pending event may move a rating once it resolves.
- Rating withdrawal — the end of a rating’s life: the agency stops maintaining its opinion, and surveillance ceases.
- SMA classification — the RBI’s early-stress bands sitting between a standard account and a non-performing asset.
- Structured obligation — an obligation serviced by a defined transaction structure and its cash flows; the (SO) suffix.
- Unaccepted rating — a rating the agency assigned but the issuer did not accept, disclosed separately on the agency’s website.
Where to start
If you are working through a rating press release for the first time, four entries carry most of the weight: the rating rationale is the document itself, the bank loan rating is what most Indian borrowers are rated for, the lender-wise annexure is the table at the back that names the banks, and the rating outlook is the directional view most often misread as a forecast.
The supervisory terms — SMA classification and the large exposures framework — describe RBI reporting rather than public disclosure. For the repository they feed into, see the CRILC explainer and who can access CRILC data.
Where these terms come from in practice
Almost every term above appears in a single document type: the rating press release a SEBI-registered agency publishes for each rating action. If you have not read one closely, the walkthrough guide takes the document apart section by section, and how to check a company’s credit rating explains where to find one for a given company.
Related
- Resources — guides and reference material
- Credit rating agencies in India — the seven, compared
- Coverage — what TatvaRatings holds, with an as-at date
- Data limits — what it is bounded by