Economy & Market
ICRA launches new credit rating system for infra
Rating agency ICRA Ltd has come out with a new credit rating system for the infrastructure sector, in compliance with the announcement made in Budget 2016. The new system will give emphasis to various inbuilt credit enhancement structures instead of relying upon a standard perception of risk which may result in mispriced loans due to a lower credit rating. 'The new rating system will focus on the overall recovery of dues by the investor/lender, a metric that can be evaluated subsequently, making this scale amenable to get itself evaluated for its differentiating and predictive capability,'the ICRA note said. Under the new rating scale, final ratings will be assigned on expected loss on the scale from [Infra] EL 1 to [Infra] EL 7, where instruments rated 'EL 1' would be considered to be having the lowest expected loss and instruments rated 'EL 7' the highest.