S&P Global Ratings

Definition

S&P Global Ratings is a prominent credit rating agency that assesses the creditworthiness of borrowers, ranging from corporations to governments. It assigns ratings based on financial health and ability to repay debt obligations.

5 Must Know Facts For Your Next Test

1. S&P Global Ratings is one of the 'Big Three' credit rating agencies along with Moody's and Fitch Ratings.
2. The ratings range from AAA (highest) to D (default), with various degrees of risk in between.
3. It plays a crucial role in the US financial markets by influencing interest rates and investment decisions.
4. The agency's ratings are used globally and have significant impacts on borrowing costs for entities.
5. S&P Global Ratings also provides market intelligence, research, and data analysis apart from credit ratings.

Review Questions

• What are the primary functions of S&P Global Ratings?
• How do S&P Global Ratings affect interest rates and investment decisions?
• What is the significance of an AAA rating compared to a D rating?

Related terms

Credit Rating:

An evaluation of a borrower's ability to repay debt, typically expressed as a letter grade.

Moody's:

Another major credit rating agency that evaluates the financial health of borrowers.

Fitch Ratings: A global credit rating agency that also assesses the likelihood of default by borrowers.