CRISL, CRAB allowed to do credit rating
Thursday, 30 April 2009
Siddique Islam
The central bank has allowed two credit rating agencies for working as external credit assessment institutions (ECAIs) to assess credit risks in line with the Basel-II framework, officials said Wednesday.
Two local credit rating agencies - Credit Rating Information and Services Limited (CRISL) and Credit Rating Agency of Bangladesh (CRAB) - have been recognised as ECAIs.
"All the scheduled banks operating in Bangladesh may nominate any or both the rating agency or agencies for their own and counterparty credit rating for the purpose of calculating risk weighted assets (RWA) against credit risk under standardised approach of risk based capital adequacy for banks," the central bank said in its circular, issued Wednesday.
"The mapping of CRISL and CRAB rating with the central bank rating grade has already been set to calculate the RAW," a senior official of the Bangladesh Bank (BB) told the FE.
He also said the central bank will calculate the RWA on the basis of two rating agencies reports.
"It has been decided to use standardised approach for calculating RWA against credit risk, credit rating is to be determined on the basis of risk profile assessed by the ECAIs duly recognized by the central bank," the BB official added.
The central bank has allowed two credit rating agencies for working as external credit assessment institutions (ECAIs) to assess credit risks in line with the Basel-II framework, officials said Wednesday.
Two local credit rating agencies - Credit Rating Information and Services Limited (CRISL) and Credit Rating Agency of Bangladesh (CRAB) - have been recognised as ECAIs.
"All the scheduled banks operating in Bangladesh may nominate any or both the rating agency or agencies for their own and counterparty credit rating for the purpose of calculating risk weighted assets (RWA) against credit risk under standardised approach of risk based capital adequacy for banks," the central bank said in its circular, issued Wednesday.
"The mapping of CRISL and CRAB rating with the central bank rating grade has already been set to calculate the RAW," a senior official of the Bangladesh Bank (BB) told the FE.
He also said the central bank will calculate the RWA on the basis of two rating agencies reports.
"It has been decided to use standardised approach for calculating RWA against credit risk, credit rating is to be determined on the basis of risk profile assessed by the ECAIs duly recognized by the central bank," the BB official added.