Source – ZebraResearch
‘Does cost of getting rated really matters in credit rating business?
- Except for some SMEs, who might think it’s a complete wastage to spend on getting a stamp on the paper, it really doesn’t matter. The pricing structure for Credit Rating is ‘roughly’ 0.1% for initial fees and 0.03% for surveillance fees.
- For large corporates and banks whose borrowing ability and credit costs depend on the kind of ratings they get, fees don’t really matter as much as ratings do. That’s why rate shopping becomes an important factor in the selection process.
What matters in the credit rating space is –