Management of Financial Services

Presented By:

Neha Sharma

Roll No. 960

Credit Profile And Rating Migration Of

Mobile Industry In The

Middle East North American Countries

Of Mobile Industry in Middle East North American Countries

CREDIT PROFILING• A credit profile is a document which provides information

about a person’s or a business entity’s credit history.

• Credit profiles are used by lenders and other agencies

which offer credit to determine creditworthiness.

• They are also utilized by prospective landlords and other

people who might have an interest in an entity’s credit

history.

• A good credit profile will make it easier for someone to

access credit, and a bad credit profile can become a major

stumbling block.

Credit RatingCredit rating is an analysis of the

credit risks associated with a financial

instrument or a financial entity.

It is a rating given to a particular

entity based on the credentials and

the extent to which the financial

statements of the entity are sound, in

terms of past borrowing and lending.

Credit Rating Agencies

Objective of Credit Rating

• The primary objective of rating is to

provide guidance to the investors/creditors

in determining a credit risk associated with

debt instrument/credit obligation.

• It does not amount a recommendation to

buy, hold or sell an instrument as it does not

take into consideration factors such as

market prices, personal risk preferences and

other considerations which may influence

an investment decision.

Credit Rating Process

Credit Ratings Scale

Core Rating Drivers for Ratings

1. Operating Environment, specifically market

dynamics, such as industry structure, market

share, and organic growth opportunities, together

with the regulatory environment

2. Strategy and Execution, covering the nature of a

company’s business model, reinvestment

requirements, competence and style of

management

3. Technology, with consideration of how exposed

a company may be to technological change and

how well positioned it is to handle such change.

4. Financial Strength, with emphasis

on return on assets, leverage, and

interest coverage

5. Developed or Emerging market,

an assessment of the legal and

political environment

6. Generic rating factors applicable

across all industries – such as

corporate governance, liquidity, and

sovereign ceiling considerations.

BENEFITS OF CREDIT

PROFILINGTo the Investors

• Helps in Investment Decision

• Benefits of Rating Reviews

• Assurance of Safety

• Easy Understandability of

Investment Proposal Choice of

Instruments

• Saves Investor's Time and Effort

To the Company

• Improves Corporate Image

• Lowers Cost of Borrowing

• Wider Audience for Borrowing

• Good for Non-Popular

Companies

• Act as a Marketing Tool

• Helps in Growth and

Expansion

Credit Migration• Credit Migration refers to upgrading or worsening

in a credit's ranking and credit grade over time. It

is the migration of a debt instrument from one

rating to another rating over a period of time.

• This movement indicates the change in the credit

quality of the instrument assessed by the rating

agency.

The International Rating Agencies such as

S&Ps, Moody's, and Fitch assess the credit

quality of the entire debt instrument in their

portfolio and assign a rating to the credit

quality.

This rating changes as and when new

information is available about the obligor's

financial health.

CREDIT RATING OF MOBILE

INDUSTRY IN MIDDLE EAST

NORTH AMERICA

Mobile Industry in Canada

Canada is a country where the telecommunications industry was mostly

state-owned, but the sector’s privatisation has meant the founding of some of

the largest telecom companies in North America.

Major Mobile Companies in the

Canada

Rogers Wireless

• With nearly 9,000,000 subscribers, this company which is

headquartered in Toronto is the leading company in Canada

when it comes to the telecommunications industry, especially

since it purchased Fido, the wireless network, in 2004. But

there are many other reasons for Rogers’ leadership, like the

fact that it also owns Chatr wireless network, or that the

company carries phones made by most manufacturers, from

Samsung and Apple to Nokia, Motorola, LG or Sony Ericsson,

HTC, HP…

Bell Mobility

• Bell Mobility (with headquarters in Mississauga) is clearly number two

of the list with more than 7,000,000 subscribers. Operating under the

networks it owns (Virgin Mobile Canada, Solo Mobile and Loblaw’s PC

Mobile) the Bell network comes on Motorola, LG, Samsung, Nokia,

Sanyo, Palm, RIM, HTC…and Apple.

Telus Mobility

• Headquartered in Burnaby, Telus has nearly 7,000,000 subscribers. At

first it was a way for the Alberta Government Telephones Commission to

be privatised back in 1990. It wasn’t until 1996 that Telus became a

consumer brand (one year after purchasing Ed Tel). Among the devices

Telus offers, we can find Huawei, HTC, Nokia, LG, Samsung, RIM…

Telus recently became the first North American operator (out of the

wireless ones) to offer HSPA+ Dual Cell technology.

Major Mobile Companies in the

Canada

Bell Canada Enterprises

Rating & Outlook

DBRS

Commercial paper R-1 (low) / Stable

Long-term Debt BBB (high) / Stable

Preferred Shares Pfd-3 (high) / Stable

MOODY'S

Long-term Debt Baa2 / Stable

STANDARD & POOR'S

Corporate Rating BBB+ / Stable

Long-term Debt BBB+ / Stable

Preferred Shares P-2 (low) / Stable

ROGERS

Rating & Outlook

FITCH

Default Rating BBB+ with a stable outlook

Senior unsecured debt BBB+ with a stable outlook

MOODY'S

Default Rating Baa1, stable outlook

Senior unsecured debt Baa1, stable outlook

STANDARD & POOR'S

Default Rating BBB+ with a stable outlook

Senior unsecured debt BBB+ with a stable outlook

TELUS

Rating & Outlook

DBRS

Commercial paper R-1 (low)

Long-term Debt A (low)

MOODY'S

Notes BAA1 / Stable

STANDARD & POOR'S

Notes BBB+ / Stable

Long-term Debt BBB+ / Stable

MOBILE INDUSTRY IN USAThere are many telecommunications companies in the USA, some of them

provide services all around the country and some of them in certain areas alone.

But the top 3 companies in number of subscribers are Verizon Wireless, AT&T

Mobility and Century Link.

Mobile Companies in USA•

Verizon

• Verizon Wireless is the largest mobile services

provider in the US, with over 108.7 million

customers. The main factor for its success is

its customer service and network reach and

reliability, which has awarded it the best J. D.

Power’s Custom Satisfaction award.

AT & T

• With 103 million subscribers, AT&T Mobility comes in

a second place in the ranking, right after Verizon,

mainly for its customer services. It has the largest

selection of available phones, its wireless network is

extensive, with the largest 4G network within the US.

Century Link

• CenturyLink, Inc., is an American multinational

communications company headquartered in Monroe,

Louisiana. It provides communications and data

services to residential, business, governmental and

wholesale customers. It is the third-largest

telecommunications company in the United States in

terms of lines served.

VERIZON

Rating & Outlook

FITCH

Long-term Debt A-

MOODY'S

Notes BAA1 / Stable

STANDARD & POOR'S

Long-term Debt BBB+ / Stable

Corporate CreditBBB+ / Stable

Rating

FITCH

Senior Unsecured 30-year notes

A

MOODY'S

Senior unsecured rating A3

Short term rating Prime-2

STANDARD & POOR'S

Corporate Rating A-/Stable/A-2

Senior Unsecured Notes Due 2042

A-

Rating & Outlook

FITCH

Long-term Debt A-

MOODY'S

Notes BAA1 / Stable

STANDARD & POOR'S

Long-term Debt BBB+ / Stable

Corporate CreditBBB+ / Stable