Dagong Europe Credit Rating

Dagong Europe Credit Rating[1] srl (Dagong Europe) was established in March 2012 with headquarters in Milan, Italy. In June 2013, it was registered and received authorisation from the European Securities and Markets Authority ('ESMA') under the Article 16 of the Credit Rating Agency (CRA) regulation. It is the first entity to have applied for registration as a CRA with shareholders from the People's Republic of China.[2] It is recognised by the Joint Committee of the three European Supervisory Authorities (EBA, ESMA and EIOPA – ESAs) as External Credit Assessment Institutions (ECAI) operating in the European Union. In December 2016, Dagong Europe opened its branch office in Frankfurt, Germany.

Dagong Europe Credit Rating
IndustryFinancial Services
Founded2012
HeadquartersMilan, Italy
WebsiteOfficial website

Dagong Europe is solely owned by Dagong Global Credit Rating, the leading Chinese rating agency and is a member of the Dagong Global Credit Rating Group.[3]

Dagong Europe provides credit opinions on financial institutions including insurance companies and non-financial corporates.[4]

Credit ratings
  • Long-Term Credit Rating Scale: Assigned to issuers (debt obligations) with tenors exceeding 12 months.
  • Short-Term Credit Rating Scale: Assigned to issuers (debt obligations) with tenors below 12 months. Could be extended under some certain circumstances.[5]

Long-term ratings

Dagong Europe's Long-Term Credit Ratings consists of ten categories, ranging from ‘AAA’ – the highest credit quality, to ‘D’ – an actual default context.
Each category (except ‘AAA’ and credit ratings below ‘CCC’) can be further divided into three sub-categories:[5]

(+): highest position
No symbol: middle and
(−): lowest position within the category.

The ten categories identify the credit quality of the debt obligators are:

  • AAA: Highest Credit Quality
  • AA: Very High Credit Quality
  • A: High Credit Quality
  • BBB: Medium Credit Quality
  • BB: Speculative Credit Quality
  • B: Highly Speculative Credit Quality
  • CCC: High Credit Risk
  • CC: Very High Credit Risk
  • C: Highest Credit Risk
  • D: Default status

Short-term ratings

Dagong Europe’s Short-Term Credit Ratings consist of six categories, ranging from ‘A-1’ – the highest financial capacity to fulfill short-term debt obligations, to ‘D’ – default.

The six categories identify the debt issuers's financial strength within the next 12 months are:[5]

  • A-1: Superior short-term financial strength
  • A-2: Strong short-term financial strength
  • A-3: Sufficient short-term financial strength
  • B: Acceptable ability to repay debt obligations
  • C: Questionable ability to repay debt obligations
  • D: Default status

Long-term and short-term credit rating relationship

The comparison is only indicative and may be subject to changes. (Long-Term = Short-Term)[5]

  • From AAA to A = A-1
  • A− = A-1 or A-2
  • BBB+ = A-2
  • BBB = A-2 or A-3
  • BBB− = A-3
  • From BB+ to B− = B
  • From CCC+ to C = C
  • D = D

References
  1. "Dagong Europe". Dagong Europe. Archived from the original on 2018-08-20. Retrieved 2014-02-19.
  2. Jones, Huw (2013-06-07). "Chinese rating agency Dagong gets EU approval | Reuters". Uk.reuters.com. Retrieved 2014-02-19.
  3. Title: Dagong Global eyes enhanced placement of Dagong Europe, Date: 2014-Dec-08
  4. "China's Dagong eyes up to 10 pct of European ratings market". Reuters. 2013-07-02. Retrieved 2014-02-19.
  5. "Dagong Europe Credit Rating Definitions" (PDF). Dagongeurope.com. 18 June 2013. Retrieved 2014-02-19.
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