A classic credit rating is the result of a large-scale labourious researchreflected in a single final indicator, which portrays the company’s overall reliability. This and other related issues were discussed at a roundtable meeting held by the representatives of the financial sector of Uzbekistan on 17 August at the Ministry of Finance of Uzbekistan.
The meeting titled "Rating as a powerful tool for attracting investors" was organised by the Ministry of Finance, the Association of Professional Participants of the Insurance Market of Uzbekistan, the Centre for Coordination and Control over the Functioning of the Securities Market, the Association of Leasing Companies and Credit Unions, Expert RA Rating Agency (Russia) and SAIPRO Company (Uzbekistan).
Using this opportunity, UzReport.com reporter interviewed Russian expert, the Director-General of the Expert RA Agency Dmitriy Grishankov.
- How long did it take Expert RA to earn reputation in the market?
- Answering this question, I would like to speak of the international experience. We periodically survey the world market for rating services and I can state that currently about a hundred rating agencies operate around the world more or less actively. The average period it takes a company to establish and raise its business is approximately 5 to 7 years. It took about the same time for our company to strengthen its position in the market, and this year our agency turns ten.
- What markets has the Agency penetrated?
- Apart from Russia, today we have clients in Poland, Czech Republic, Baltic, Ukraine, Kazakhstan, Uzbekistan and in principal we currently position ourselves as an agency that targets the markets of the former Soviet Union. This is explained, first of all, by the fact that Russian language is still widely used on the territory of these countries, at least most of them, and this is an integral factor. And secondly, despite some major differences in the legislations of these countries, some common methodological grounds are there, and a certain common approach, a method of entry can be used. Our ambitions at this point envisage the establishment of the rating services market on this territory, and then we will move further.
As for the offices, due to the relatively small number of foreign clients outside the Russian Federation, we work mainly through representatives, because it is easier for us to send a person on a business trip so he or she works with one or two clients. Besides, the legislative bases of some of the countries, such as say Ukraine, do not allow us to open offices. As you know, according to a recent governmental resolution, only local operators with the required Ukrainian capital can work in the country’s rating services market, and that is why a number of international rating agencies are experiencing problems with operation there.
As for Uzbekistan, I can say that we are now considering different alternative actions, and whatever the case, we will closely cooperate with local structures, particularly, SAIPRO Company. With this company last year we signed an agreement of cooperation in the development of rating culture and the quality of ratings in the countries of Central Asia. I believe that we will continue to support at least information cooperation with this agency, and as a maximum we plan development of closer cooperation.
- Which of your rating products finds the highest demand?
- The family of Expert RA’s ratings includes classic credit ratings of companies of all sectors of economy (Banks, insurance and leasing companies, industrial enterprises, factoring, etc), regions and municipal forms, as well as ratings characterizing different aspects of companies’ social responsibility: the ratings of corporate governance, ecological responsibility, etc. Moreover, we regularly prepare and publish the rankings of the largest Russian companies and the leaders of the sectors of economy, and the ratings of regions’ investment attractiveness.
To take Russia’s experience, the highest demand was demonstrated for the ratings of insurance and leasing companies, because this sector experiences probably the toughest competition for the clients. As for the banking system, in Russia, the banks have divided the market between themselves, and each watches over its own niche. This naturally has its effect on the competition. And rating only exists where there is competition.
Expert RA Expert RA Rating Agency is the first independent rating agency in Russia. It was established by the Expert magazine in 1997. Today, it is the largest national rating agency in the country, employing over 60 staff men.
At the core of the agency’s business is a unique system of rating products. The Expert RA’s rating family includes classic credit ratings of the companies of different sectors of economy, regions and municipal establishments, as well as ratings describing different aspects of the companies’ social responsibility: corporate governance rating and ecological responsibility rating.
Today, Expert RA’s ratings are awarded to over 100 companies (including companies in Eastern Europe, CIS and Baltic) and regions, of which more than 60 have received the company’s credit ratings.
Other areas of the agency’s activity include preparation and publication of the lists of largest companies in Russia and the leaders of individual sectors of economy, and the ratings of regions’ investment appeal. The agency carries out complex researches of different sectors of Russian economy and commodity markets.
Over the years of its operation, Expert RA has gained recognition in Russian and foreign business circles as the provider of objective, independent and professionally prepared rating products and analytical materials.