Introduction of Expected Loss Based Rating Scale

To standardise the usage of rating scales, Credit Rating Agencies (CRA) were advised to align their rating scales with the rating scales prescribed under the guidelines of the respective financial sector regulator or authority in terms of Regulation 9(f) of SEBI CRA Regulations, or in the absence of the same, to follow rating scales prescribed by the Board from time to time. Further, a seven-point Expected Loss (EL)-based rating scale was introduced to be used by CRAs for ratings of projects/ instruments associated with the infrastructure sector to begin with.