A tag appended to a credit rating indicating that the issuer has stopped providing the agency with the information needed to review it, and that the rating is being maintained on the basis of best available — and possibly dated — information.
Usually written in full and in capitals alongside the symbol, for example BBB-; ISSUER NOT COOPERATING. Commonly abbreviated INC.
What triggers it
A rated issuer is under a continuing obligation to provide the agency with the information it needs to review the rating periodically. Where the issuer stops responding — no financial statements, no no-default statement, no reply to the agency’s requests — the agency cannot conduct a normal review. Rather than simply going silent, SEBI’s framework requires the agency to continue publishing and to mark the rating as issuer-non-cooperating, with the basis stated.
Agencies typically make repeated documented attempts to obtain information, and publish the tag only after those attempts fail.
What it actually means for a reader
The rating’s vintage is worse than the publication date suggests. An ordinary rating action carries information roughly as current as its date. An INC release is dated today and may rest on information from several review cycles ago, and how much older is not always evident from the document.
It carries an adverse signal in its own right. Non-cooperation is itself information about an issuer, and agencies commonly move a rating into the sub-investment grades on migration to INC.
Everything downstream inherits the staleness. The financials, the rated facilities table and the lender-wise annexure in an INC release should all be treated as older than the release date. A banking relationship shown in an INC annexure may have ended long before.
How to handle it
Check whether a non-INC action exists from another agency on the same borrower — a company rated by two agencies may be cooperating with one and not the other. Look at the rating history block to find the last date at which a full review occurred. And treat any figure inside as a floor of unknown vintage rather than a current position.
Related
- Rating rationale — the document an INC action is published in
- Lender-wise annexure — the table whose vintage INC calls into question
- Rating watch — a different reason a rating is not settled
- How to read a rating press release
- Data limits — how staleness is specified
- Glossary index