What Is A Ratings Agency?

Patrick Curtis

Reviewed by

Patrick Curtis WSO Editorial Board

Expertise: Investment Banking | Private Equity

A ratings agency is a firm that attempts to provide a rating for the credit-worthiness of a corporation, government or bond. The more likely the borrower is to repay, the higher credit rating they receive.

The 3 largest credit ratings agencies in the world are:

  • Moody's
  • Standard & Poors
  • Fitch

Typically, anything assigned a rating of AAA, AA, A or BBB is deemed to be of investment grade whilst anything below is junk (i.e. very risky and unlikely to pay off).

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Patrick Curtis

Patrick Curtis is a member of WSO Editorial Board which helps ensure the accuracy of content across top articles on Wall Street Oasis. He has experience in investment banking at Rothschild and private equity at Tailwind Capital along with an MBA from the Wharton School of Business. He is also the founder and current CEO of Wall Street Oasis. This content was originally created by member WallStreetOasis.com and has evolved with the help of our mentors.