Rating Interpretation
A downward trend in the KBRA Rating is a likely indicator of deterioration in the institution's financial condition and a steady increase in the rating generally signals an overall strengthening of the institution's financial position.
- A high steady "A" or "B+" rating indicates a strong financial condition. Most institutions will fall into the "A" and "B" rating categories.
- "C+" is the lowest investment grade rating Kroll Bond Ratings assigns to institutions.
- Institutions having a "C" or below rating are considered below investment grade. These institutions are likely to have either a relatively weak overall financial condition or a weakness in one more of the key financial ratios, likely falling into the bottom quartile of their peer group. The lower the rating the greater the concern one should have about the financial condition of the institution.
- "D" and "E" rated institutions are likely to have financial problems and careful consideration should be given prior to investing in, or doing business with, these institutions. These entities are likely to have a higher probability of failure than institutions with higher ratings.
- The KBRA Rating "NB", "NT" stands for a new bank or new thrift respectively, whose charter is less than three years old.
- An "NR" stands for not rated. An institution can receive an "NR" for several reasons: atypical structure, incorrect or missing data, or the institution has requested KBRA not to rate it. Kroll Bond Ratings reserves the right not to rate any institution by assigning it an “NR” or deleting it from our services.
It should be noted that inaccurate reporting by institutions of their financial data will likely result in incorrect KBRA ratings for those institutions.