Kroll Bond Rating Agency (KBRA) assigns credit ratings to issuers and their obligations and, through its Subscription Rating Service (SRS), financial strength ratings to financial institutions, corporations and sovereigns.
Long-Term Credit Ratings Scale | Short-Term Credit Ratings Scale | Financial Strength Ratings
Kroll Bond Rating Agency (KBRA) assigns credit ratings to issuers and their obligations using the same rating scale. In either case, KBRA's credit ratings are intended to reflect both the probability of default and severity of loss in the event of default, with greater emphasis on probability of default at higher rating categories. For obligations, the determination of expected loss severity is, among other things, a function of the seniority of the claim. Generally speaking, issuer-level ratings assume a loss severity consistent with a senior unsecured claim. KBRA appends an (sf) indicator to ratings on structured finance obligations.
| AAA | Determined to have almost no risk of loss due to credit-related events. Assigned only to the very highest quality obligors and obligations able to survive extremely challenging economic events. |
| AA | Determined to have minimal risk of loss due to credit-related events. Such obligors and obligations are deemed very high quality. |
| A | Determined to be of high quality with a small risk of loss due to credit-related events. Issuers and obligations in this category are expected to weather difficult times with low credit losses. |
| BBB | Determined to be of medium quality with some risk of loss due to credit-related events. Such issuers and obligations may experience credit losses during stress environments. |
| BB | Determined to be of low quality with moderate risk of loss due to credit-related events. Such issuers and obligations have fundamental weaknesses that create moderate credit risk. |
| B | Determined to be of very low quality with high risk of loss due to credit-related events. These issuers and obligations contain many fundamental shortcomings that create significant credit risk. |
| CCC | Determined to be at substantial risk of loss due to credit-related events, or currently in default with high recovery expectations. |
| CC | Determined to be near default or in default with average recovery expectations. |
| C | Determined to be near default or in default with low recovery expectations. |
| D | In default. |
Kroll Bond Rating Agency's short-term ratings indicate ability to meet obligations of less than one year remaining maturity. Short-term ratings may be assigned to both issuers and to specific obligations. As compared to long-term ratings, greater emphasis is placed on an obligor's liquidity profile and access to funding.
| K1 | Very strong ability to meet short-term obligations. |
| K2 | Strong ability to meet short-term obligations. |
| K3 | Adequate ability to meet short-term obligations. |
| B | Questionable ability to meet short-term obligations. |
| C | Little ability to meet short-term obligations. |
| D | In default on short-term obligations. |
The Kroll Bond Rating Agency (KBRA) financial strength rating is a measure of the overall financial condition of an institution and its ability to meet its credit obligations.
| A | An institution in strong financial condition that is well capitalized, liquid and profitable. The entity is highly likely to meet its credit obligations under severe economic, financial and business conditions. |
| B | An institution in sound financial condition that is likely to meet its credit obligations under difficult economic, financial and business conditions. |
| C | An institution with an adequate financial condition but is more susceptible to adverse changes in economic conditions that could affect its ability to meet its credit obligations. |
| D | An institution whose financial condition is judged to be relatively weak and its ability to meet financial obligations could be affected by adverse economic, financial or business conditions. |
| E | An institution that is likely to have financial problems and poor financial ratios. Careful consideration should be made concerning investments in this institution. The institution has a much higher probability of failure than institutions with higher ratings. |
| NB | A new institution which is less than three years old and which is not rated, but its financial data is presented and an "NB" is shown in the rating field. |
| NT | A new savings & loans which is less than three years old and which is not rated, but its financial data is presented and an "NT" is shown in its rating field. |
| NR | An atypical bank, bank holding company or S&L, or an institution missing key financial data necessary to derive a rating. |
