Credit Ratings Agencies

Credit Rating Agencies (CRAs) assess the creditworthiness of borrowers, including individuals, companies, and governments. They analyze financial health, debt levels, and repayment history to assign ratings, which reflect the likelihood of defaulting on obligations. A higher rating indicates lower risk, while a lower rating suggests higher risk. These ratings help investors make informed decisions regarding loans, bonds, and investments. Major agencies include Standard & Poor's, Moody's, and Fitch. Their assessments play a crucial role in the financial system, influencing borrowing costs and market stability.