Memorandum of understanding

RAEX-Europe participated in foundation of the Silk Road alliance of rating agencies

On 17th of December 2018 in Beijing a cooperation memorandum was signed by four credit rating agencies representing the Silk Road countries: largest Chinese rating agency China Chengxin International Credit Rating Co., Ltd. (CCXI), Rating-Agentur Expert RA GmbH (RAEX-Europe), Pakistan rating agency JCR-VIS Credit Rating Co. Ltd. and the Bahraini Islamic International Rating Agency (IIRA).

The memorandum was signed during large and important event in the Asian financial market - the 11th China International Credit and Risk Management Conference, which gathers annually more than five hundred professional participants.

The main purpose of the memorandum is strategic alliance and cooperation to provide informational support for investors to the Belt & Road countries and projects.

The agreement consolidates already established experience of sharing best practices in methodologies, technologies and marketing among the rating agencies.

Distinctive feature of this agreement is that the CRAs signing it are, on one hand, officially recognized and accredited in their countries, and their ratings are used by local regulators and financial markets. On the other hand, the agencies represent different business cultures: from European business to Islamic finance and Chinese economic model. Therefore, for international investors, their expertise and assistance in investing to new territories will be extremely important. Agencies will develop new products together and assist each other in sales activities.

Another feature is that the new alliance is aimed not only at credit ratings, but also at the assessment of responsible financing and green finance support services: ESG (Environment, Social, Governance) ratings, Green Bond second opinions, promotion of a new product for Belt & Road ISG-ES (combining evaluation of the investment strength and ESG factors with increased attention to the governance factor).

The first product of the new alliance was presented directly at the conference - the annual report “Silk Road Country Risks - 2018”. This is very significant analytical report on the territory of the Silk Road countries and this year it was prepared by a joint analytical team of alliance of rating agencies.

Info on the CRAs:

China Chengxin International Credit Rating Co., Ltd. ("CCXI") was founded in 1992. Due to the significant amount of business activities and the best quality services, CCXI is highly regarded among credit rating agencies in the domestic bond market. Since 1992, CCXI has maintained its leading position in the credit rating industry, ranking first in terms of total market share for each type of service. The agency has a subsidiary rating agency in Hong Kong. http://www.ccx.com.cn/

VIS Group is operating since 1994. Currently, VIS has expanded as a group of companies providing various types of information services, and has become the main independent information source in the region. Being exceptionally successful in Pakistan, the Group has now entered into agreements to establish joint ventures in various regional markets, including Bangladesh, Bahrain and Iran. Together with its affiliates and joint ventures, the group covers more than 20 countries, from Africa to East Asia. http://jcrvis.com.pk/ 

The Islamic International Rating Agency (IIRA) is the only rating agency established to provide capital markets and banking sector in predominantly Islamic countries with rating services covering the entire spectrum of capital instruments and specialized Islamic financial products, as well as to increase the level of analytical expertise in these markets. http://iirating.com/