Fitch IBCA Inc. has redefined and broadened its ratings criteria, the agency announced yesterday.
The changes come less than a month after the merger between Fitch Investors Service and IBCA Group was completed, a merger that takes Fitch's business to an international level.
"All ratings scales were modified to reflect a full range of rated obligations on an international scale," according to Stephen Joynt, president of Fitch IBCA.
The addition of IBCA broadens the spectrum of issues Fitch traditionally covered, taking the firm beyond simply securities and structured financings and adding entities such as sovereign nations, banks, and corporates.
According to David Litvack, a senior director with Fitch IBCA, the changes are simply an effort to harmonize "the ratings definitions between IBCA and ourselves."
Among the most notable changes, Fitch IBCA's RatingWatch service will notify investors of the likelihood of any rating changes and the direction the change will most likely be in, said the agency in a release.
The service will post designations of "positive" for a possible upgrade, "negative" for a downgrade, or "evolving" if a rating might be raised, lowered, or maintained.
The agency has also added separate rating scales for long- and short- term international credit ratings, bank performance and support ratings, mortgage servicers, and international issuers.
In its short-term scale, the agency has added a "C" rating to indicate cases where default is a strong possibility but has not yet happened.
