Credit rating has been made mandatory for all companies listed in the capital market. From now on every company has to be rated periodically. And that rating value should be disclosed in the form of Price Sensitive Information (PSI).
Recently, the capital market regulatory body Bangladesh Securities and Exchange Commission (BSEC) has issued instructions in this regard. As of Today, Monday, September 12, the relevant gazette has been published on the BSEC website.
As per the guidelines, all companies other than life insurance companies are required to get credit rating at least once every year and life insurance companies once every two years.
Companies other than life insurance companies are required to obtain credit rating within 6 months of the end of their financial year. On the other hand, credit rating should be done once every two years for life insurance companies.
The rating report shall be published in PSI form immediately after receipt. Also, it should be sent to the stock exchange. Stock exchanges will publish the report through their websites and trading terminals.
In other words, a credit rating indicates an organization’s ability to repay debts. If a company has a good rating, lending to that company or investing in its shares is considered less risky.
