DBRS Releases Updated Global Methodology for Rating Finance Companies

DBRS today published an updated version of its Global Methodology for Rating Finance Companies that is effective as of today. This updated methodology was issued for comment on August 18, 2014. There were no comments and no subsequent changes to the methodology.

This updated methodology addresses in more detail how DBRS evaluates finance companies globally. This updated methodology includes several new exhibits and tables that provide additional clarity as to how the five interlocking building blocks are utilized by DBRS to arrive at the intrinsic assessment for an individual finance company that underpins its final ratings. This version of the methodology has a core framework applicable to all finance companies and is now clearly designated as global in nature. Individual appendices address the specific operating characteristics of certain finance company sectors that warrant additional analytical considerations.

This methodology replaces several existing methodologies: Rating Finance Companies Operating in the United States, Rating Auto Finance Companies Operating in the United States, Rating Captive Finance Companies, and Non-Captive Automotive Finance Companies.

Some of the appendices in this version of the methodology update existing methodologies, while others are new additions to the basic framework. The appendices include: Captive Finance Companies, Auto Finance Companies, Rental Car Companies, Aircraft Leasing Companies, Container Leasing Companies, and Residential Mortgage and Home Lending Related Companies.

While DBRS considers this methodology update to be a material change due to the significant level of new detail, it is not a departure from the last published versions in terms of the core approach used by DBRS to assess finance companies. Accordingly, this methodology release has not resulted in any rating changes or other rating actions.

DBRS criteria and methodologies are publicly available on its website. http://www.dbrs.com/methodologies

For more information on ratings for banks and other financial institutions, visit www.dbrs.com or contact us at info@dbrs.com.