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Understanding RATINGS


Rating Agency of Cambodia’s steps on the Credit Rating Process:

  • Credit Rating Contract: the issuer/obligor requests for a credit rating have to meet with the RAC to discuss detail about the needs and then RAC will determine fee and timeline. When both parties agree on all the terms and conditions, they sign contract.
  • Credit Rating Analysis: based on the credit rating criteria (can be found below in the Credit Rating Criteria).
  • Credit Scoring Matrix: 5 categories from very low risk to very high risk which each category is divided into two.
  • Credit Scoring Scale: weighting how much is from Business Risks and how much is from Financial Risks, including the “Soft-Factor Discount” and “Sovereign Rating” to arrive at Default Risk Scoring.
  • Recovery Scoring: based on collateral, ring fencing of assets, seniority, legal protection, bankruptcy regime and guarantee