Global Credit Ratings (“GCR”) can trace its origins back to 1996 when it was established as the African Arm of the New York Stock Exchange-listed Duff & Phelps. Very rapid growth followed and GCR has since established itself as the market leader, accounting for the majority of all ratings accorded on the African continent (in fact rating more African credits than S&P, Moody’s and Fitch combined). GCR’s African regional headquarters are based in Johannesburg, with its main SADC, West, and East African regional offices established in Harare, Lagos and Nairobi respectively.
Having firmly established a market leadership position in Africa, a major thrust has been to establish a similar position in other key emerging markets, encompassing South America, Europe, Asia and the Middle East. This is expected to be achieved through acquisitions, alliances, and organic growth, and by drawing on the strengths of partner companies, who are typically leading players in their own domestic markets. GCR is also a founder member of Europe based ARC Ratings, which is registered with the European Securities and Markets Authority.
In support of GCR’s objective to establish itself as “a leading international emerging markets focussed rating agency”, one of the largest international Development Finance Institutions (“DEG”) acquired a significant stake in the business in December 2007, and further increased its shareholding in both 2012 and 2014. In addition, the Carlyle Group acquired a 49.9% stake in GCR towards the end of 2016. Carlyle is the pre-eminent Global Private Equity player, managing assets in the region of US$170 billion and who’s portfolio companies’ combined would rank it amongst the 10 most profitable corporations worldwide. The representation of DEG and the Carlyle Group gives significant weighting and credibility to its ratings in Africa, as well as future ratings activity across other key markets.
GCR accords both local currency National Scale ratings (which are typically tiered against an assumed “best possible” rating of AAA and enable appropriate differentiation of credit quality within each country), as well as International Scale ratings (which assess the capacity to meet commitments using a globally applicable scale, and as such are directly comparable across all countries).
GCR rates the full spectrum of security classes and its core competitive advantage is based on the principal of “analytical excellence”. GCR’s unrivalled track record for ratings accuracy is evidenced by a local currency National Scale cumulative investment grade default ratio of below 1.8% over the past 10 years, despite severe emerging market crisis and systemic shocks. It is important to appreciate the fact that emerging markets are fundamentally different to the developed markets in the US and Western Europe, which calls for a deeper appreciation of the unique characteristics of these markets. As a result of this, leading investors have placed ever-increasing reliance on GCR’s ratings and market research. Accordingly, GCR boasts a substantial subscriber base, encompassing several local and international issuing and investing institutions. Due to GCR’s entrenched position in key African markets and substantial scale economies, its rating and subscription fees are considerably lower than the competition.
GCR expects its universe of rated entities to continue to expand rapidly given the current growth trajectory of the African continent, underpinned by a tangible increase in interest in African business from investors across the globe. With its leading position in the African ratings environment, and extensive geographic network, GCR is in a unique position to offer both Issuers and Investors with unrivalled service and local expertise.
