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Impact of the methodology changes on ratings

EUROPEAN RATING AGENCY, a.s. conducts revisions of its methodology on an ongoing basis and formally regularly once a year. At this place, we publish the effects of the methodology changes to public ratings valid at the time of review, if the changes lead to at least minority effect on a rating. A change in methology means a change in key assumption, weight of an evaluated criteria, addition/removal of a criteria, the way of assigning a score to criteria, that are used in analytical assessment of a rated entity or financial instrument.

If ERA changes the rating methodology, ERA at this place disclose information on affected ratings and conducts a review of the ratings, where the changed methodology was used. If the complexity of changes and/or number of the ratings does not allow to conduct the review immediately, ERA discloses the likely scope of affected ratings and reviews them as soon as possible but no later than 6 months. ERA then publishes the actual impacts of changes in methodology to the outstanding public ratings found on the basis of their review.

Possible effects of methodology changes found on the basis of review of the ratings:

Not affected: Rating methodology change had no actual impact on the rating. The review of this rating revealed that the change had no impact on the assigned rating grade or outlook.
Affected: Rating methodology change had an actual impact on the rating. The review of this rating revealed that this change also either caused a change of the assignment grade or outlook or not. When it caused, the outcome of the review and rationale behind the change is published for the corresponding rating. Otherwise, a "No change" statement is published for the corresponding rating.


2018 - actual effects of methodology changes - corporates non-financial
Revision completion date: 10.5.2018
Number of affected ratings: 0
Total number of valid ratings: 0 (of which public: 0)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
- -
Relevant changes: Activity: Revised area:

ERA performed regular review of the rating methodology for corporates - non-financial. The review did not lead to any change in the methodology. The review had no impact on outstanding ratings and outlooks.



2018 - actual effects of methodology changes - municipalities and municipalities in Poland
Revision completion date: 18.4.2018
Number of affected ratings: 0
Total number of valid ratings: 3 (of which public: 2)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Dunajská Streda (city of) No change 1)
Mesto Stropkov (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA performed regular review of the rating methodology for municipalities and municipalities in Poland. The review did not lead to any change in the methodology. The review had no impact on outstanding ratings and outlooks.

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2017 - actual effects of methodology changes - municipalities and municipalities in Poland
Revision completion date: 18.4.2017
Number of affected ratings: 1
Total number of valid ratings: 1 (of which public: 1)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Nitra (city of) Rating increased 1)
Relevant changes: Activity: Revised area:

ERA performed regular review of the rating methodology for municipalities. Changed areas: the method of determining the outlook, the weights of the main areas, the KO criteria, the assessment of the external environment (macroeconomic environment, political risk, support for the municipal sector), internal environment, individual risk.

Reasons for rating change: change in the assessment of macroeconomic environment, political risk, support for the municipal sector and the internal environment.

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2017 - actual effects of methodology changes - corporates non-financial
Revision completion date: 11.5.2017
Number of affected ratings: 0
Total number of valid ratings: 0 (of which public: 0)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
- -
Relevant changes: Activity: Revised area:

ERA performed regular review of the rating methodology for municipalities. Changed areas: the method of determining the outlook, the weights of the main areas, the KO criteria, the assessment of the external environment (macroeconomic environment, political risk, sector profile), internal environment, individual risk.



2017 - likely effects of methodology changes - municipalities and municipalities in Poland
Revision completion date: 18.4.2017
Number of affected ratings: 1
Total number of valid ratings: 1 (of which public: 1)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Nitra (city of) Revision will be made within 6 months 1)
Relevant changes: Activity: Revised area:

ERA performed regular review of the rating methodology for municipalities. Changed areas: the method of determining the outlook, the weights of the main areas, the KO criteria, the assessment of the external environment (macroeconomic environment, political risk, support for the municipal sector), internal environment, individual risk.

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2016 - actual effects of methodology changes
Revision completion date: 15.5.2016
Number of affected ratings: 0
Total number of valid ratings: 2 (of which public: 2)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Nitra (city of) No change 1)
Mesto Piešťany (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA performed regular review of the rating methodology for municipalities and the rating methodology for corporates non-financial. The review did not lead to any change in the methodologies. The review had no impact on outstanding ratings and outlooks.

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2015 - actual effects of methodology changes
Revision completion date: 15.5.2015
Number of affected ratings: 0
Total number of valid ratings: 5 (of which public: 5)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Nové Zámky (city of) No change 1)
Mesto Skalica (city of) No change 1)
Mestská časť Bratislava - Petržalka (city district) No change 1)
Mesto Nitra (city of) No change 1)
Mesto Piešťany (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA update the area macroeconomic environment and the area of political risk in the rating methodology for municipalities and in the rating methodology for non financial companies. These changes are of material nature. They have had no impact on outstanding ratings and outlooks.

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2014 - actual effects of methodology changes
Revision completion date: 30.5.2014
Number of affected ratings: 0
Total number of valid ratings: 4 (of which public: 4)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Nové Zámky (city of) No change 1)
Mesto Skalica (city of) No change 1)
Mesto Stropkov (city of) No change 1)
Mesto Nitra (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA performed several updates in the rating methodology. These changes are not of a material nature. They have had no impact on outstanding ratings and outlooks.

1)


2013 - actual effects of methodology changes
Revision completion date: 23.12.2013
Number of affected ratings: 0
Total number of valid ratings: 4 (of which public: 4)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Nové Zámky (city of) No change 1)
Mesto Skalica (city of) No change 1)
Mesto Stropkov (city of) No change 1)
Mesto Nitra (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA performed several updates in the rating methodology. These changes are not of a material nature. They have had no impact on outstanding ratings and outlooks.

1)


2012 - actual effects of methodology changes
Revision completion date: 22.12.2012
Number of affected ratings: 0
Total number of valid ratings: 4 (of which public: 3)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Stropkov (city of) No change 1)
Mesto Skalica (city of) No change 1)
Mesto Nové Zámky (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA performed several updates of formulations in the rating methodology with no impact on ratings.

1)


2011 - actual effects of methodology changes
Revision completion date: 22.12.2011
Number of affected ratings: 0
Total number of valid ratings: 4 (of which public: 3)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Stropkov (city of) No change 1)
Mesto Skalica (city of) No change 1)
Mesto Nové Zámky (city of) No change 1)
Relevant changes: Activity: Revised area:

ERA performed several updates of formulations in the rating methodology with no impact on ratings.

1)


2010 - actual effects of methodology changes
Revision completion date: 30.11.2010
Number of affected ratings: 9
Total number of valid ratings: 11 (of which public: 10)
List of revised public ratings: Rated entity/instrument Result of revision Descr.
Mesto Sereď (city of) No change 1)
Mesto Ružomberok (city of) No change 1)
Mesto Snina (city of) No change 1)
Mesto Stropkov (city of) No change 1)
Mesto Vranov nad Topľou (city of) No change 1)
Mesto Liptovský Mikuláš (city of) No change 1)
Mesto Nové Zámky (city of) No change 1)
Mesto Trenčín (city of) No change 1)
Mesto Skalica (city of) No change 1)
Relevant changes: Activity: Revised area:

Higher emphasis laid on criteria on impact upon the entity (change in weight of criteria): The International Economy Development, the Current Economy Development in Slovakia - Price Developments, Trade Balance, Production and Sales, Wages, Employment and Unemployment, Real Economy Development in a current year

Legislative changes effect (adding a criteria, change in weight of criteria): Municipal Property Act, Income Tax Act, Budget rules of local self-government Act, Social Services Act, Budgetary rules Act, Municipalities Act

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