Home Credit Ratings: Meaning & Use Rating types Rating of non-financial corporates
Rating of non-financial corporates

The rating analysis provides creditors, investors but also the concerned entity with information and independent view on management processes and economic situation of the evaluated entity. Simultaneously the analysis aims at evaluating ability and willingness of an entrepreneurial entity to fulfill its liabilities resulting from its business activity.

What are the benefits of rating for non-financial corporates and what does the rating serve for:

Rating as an investment analysis

  • Based on an assigned rating, financing banks and investors may assign interest rate related to financial resources corresponding to the rating evaluation
  • It creates a platform aimed at negotiating commercial conditions with commercial partners of the corporate

Rating as a report on the economic activity of the corporate

  • It is a comprehensive analytic document that illustrates historical development and situation of the corporate from the aspect of an independent evaluator based on international criteria
  • It gives its opinion with respect to future intentions and plans of the corporate

Rating as an instrument of operative control

  • It provides thecorporate management with immediate information on the corporate situation


The rating process consists of gathering and processing of reference documents submitted by the corporate, of analysis and evaluation of reference documents by the rating agency and of approval of the rating by the rating committee.

The rating analysis remains valid for the period of 1 year and during this period the corporate entity is being monitored by the rating agency.

The content of the rating report includes effects determining and affecting the quality of corporate entities, such as development of macroeconomic environment, political risk, development of sector and evaluation of the entity itself.

In its evaluations, ERA also uses an additional methodology to analyze the relationship between the rated entity and the state. The assessment allows to evaluate the influence that the state represented by the national government, regional and municipal authorities as well as other government institutions has on creditworthiness of rated entities, i.e. both financial and non-financila organizations. Not being comprehensive document, this methodology contains references to other methodologies of ERA, in particular, to those for assigning credit ratings under the international scale.