How many contents does the reports on credit rating results of an agency have? What are the principles for establishment and use of system of credit rating grades in Vietnam?
Which subjects is the code of conduct of credit rating agencies applied to?
Pursuant to Article 34 of Decree No. 88/2014/ND-CP stipulating as follows:
Code of conduct
1. Credit rating agencies shall issue and apply their own codes of conduct based on the Code of Conduct Fundamentals for Credit Rating Agencies issued by the International Organization of Securities Commissions (IOSCO) and disclose such codes on their websites.
2. Credit rating agencies shall issue their codes of conduct for application to their operation, analysts and credit rating council members.
Thus, the code of conduct of credit rating agencies is applied to the following subjects:
- Operation
- Analyst
- Credit rating council.
How many contents does the reports on credit rating results of an agency have? What are the principles for establishment and use of system of credit rating grades in Vietnam?
How many contents does the reports on credit rating results of an agency have?
Pursuant to Article 35 of Decree No. 88/2014/ND-CP stipulating as follows:
Reports on credit rating results
1. Within twenty four (24) hours after issuing official decisions on credit rating results, credit rating agencies shall disclose reports on credit rating results on their websites.
2. A report on credit rating results must have the following principal contents:
a/ Credit rating grade;
b/ Overall evaluation of the rated organization;
c/ Material factors which positively and negatively impact the ability of the rated organization to honor its debt obligation;
d/ Statistics on all past credit ratings (if any) of the rated organization;
dd/ Names and titles of analysts and credit rating council members participating in the credit rating contract;
e/ Cases in which analysts and credit rating council members cease their participation in the credit rating contract before the contract expires and the reason for the cessation;
g/ Rate of holding of the credit rating agency by the rated organization;
h/ Rates of holding of the credit rating agency by its employees;
i/ Commitment to conducting credit rating in an independent and impartial manner;
k/ Disclaimer that information in the credit rating report is for reference and is not an investment or capital contribution recommendation regarding debt or financial instruments issued by the credit rating agency.
3. Reports on credit rating results shall be signed by at-law representatives or authorized persons of credit rating agencies.
Thus, within twenty four (24) hours after issuing official decisions on credit rating results, credit rating agencies shall disclose reports on credit rating results on their websites.
A report on credit rating results must have the following principal contents:
- Credit rating grade;
- Overall evaluation of the rated organization;
- Material factors which positively and negatively impact the ability of the rated organization to honor its debt obligation;
- Statistics on all past credit ratings (if any) of the rated organization;
- Names and titles of analysts and credit rating council members participating in the credit rating contract;
- Cases in which analysts and credit rating council members cease their participation in the credit rating contract before the contract expires and the reason for the cessation;
- Rate of holding of the credit rating agency by the rated organization;
- Rates of holding of the credit rating agency by its employees;
- Commitment to conducting credit rating in an independent and impartial manner;
- Disclaimer that information in the credit rating report is for reference and is not an investment or capital contribution recommendation regarding debt or financial instruments issued by the credit rating agency.
What are the principles for establishment and use of system of credit rating grades in Vietnam?
Pursuant to Article 33 of Decree No. 88/2014/ND-CP stipulating as follows:
Credit rating grades
1. Credit rating agencies shall establish and consistently use a system of credit rating grades on the following basic principles:
a/ Credit rating grades must be clear, comprehensible and comparable;
b/ Credit rating grades spread from the highest to lowest indicating the ability of rated organizations to honor their debt obligations.
2. Credit rating agencies shall disclose on their websites the symbol and its denotation of each credit rating grade.
According to the above provisions, credit rating agencies shall establish and consistently use a system of credit rating grades on the following basic principles:
- Credit rating grades must be clear, comprehensible and comparable;
- Credit rating grades spread from the highest to lowest indicating the ability of rated organizations to honor their debt obligations.
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