Understanding sovereign credit ratings

Introduction and learning outcomes

 Expected learning outcomes

By the end of the course, the participant will be able to:

• Understand the sovereign credit rating process;

• Understand the determinants of a rating;
• Understand the regulation of the credit rating industry;
• Understand the role data plays;
• Understand how to engage rating agencies and investors more
effectively;
• Build a community of experts for better knowledge of credit
rating on the continent.

2
 Training content

• Module 1: Generalities on sovereign credit ratings

– Definition of sovereign credit rating
– Key concepts in sovereign credit ratings
– The rating agencies
– Credit rating scales
– Factors affecting sovereign credit ratings
– Role and usefulness of credit ratings in capital markets
– The link between ratings and credit risk premiums
– Key takeaways

– Lecture with expert discussion

3
 Training content
• Module 2: The rating process
– Determinants of sovereign credit ratings
– Methodologies of the 3 rating agencies
– Data requirement
– The rating process
• Rating request
• Assignment of Analytical Team
• Interaction between the issuer and the analytical team
• Information collection
• Analysis and Rating Committee
• Rating dissemination and appeal process
• Rating publication ; Rating monitoring
– Rating review ; Rating actions, outlooks and watches
– Key takeaways

– Lecture with expert discussion

4
 Training content

• Module 3: Critical issues and challenges in the

sovereign credit rating process
– Regulatory issues
– Data requirement issues
– Consistency and transparency
– ESG criteria and implication in the sovereign rating process
– Perceived Africa underrating
– Impact of defaults and debt restructuring
– Communicating with rating agencies, investors and risk
analysts
– Key takeaways

– Lecture with expert discussion

5
 Organisation of the training

• The overall course will take 3 weeks, a module per week.

• Each module will require 5 hours of training consisting of:

– 3 hours of self-study time
– 2 hours of online training with the instructor and an expert.

6
 Training schedule
Week 1: 23-27 October 2023 - Module 1
Schedule Activities
23 - 26 Oct. 2023 (3 hours) Self-study by participants of module 1 materials
26 Oct. 2023, 11.00-13.00 am GMT Online class with the instructor and an expert
- Module 1 (1h30) ; Expert discussion (30 min)
27 Oct. – 10 Nov. 2023 (2 weeks) 10 randomly selected quizzes on module 1 (1 hour)
Week 2: 30 October – 3 November 2023 – Module 2
30 - 2 Nov. 2023 (3 hours) Self-study by participants of module 2 materials
3 Nov. 2023, 11.00-13.00 am GMT Online class with the instructor and an expert
- Module 2 (1h30) ; Expert discussion (30 min)
3 – 17 Nov. 2023 (2 weeks) 10 randomly selected quizzes on module 2 (1 hour)
Week 3: 6 – 10 November 2023 – Module 3
6 - 9 Nov. 2023 (3 hours) Self-study by participants of module 3 materials
10 Nov. 2023, 11.00-13.00 am GMT Online class with the instructor and an expert
- Module 3 (1h30) ; Expert discussion (30 min)
10 – 24 Nov. 2023 (2 weeks) 10 randomly selected quizzes on module 3 (1 hour)
Week 4: 13 to 27 November 2023 – Online final exam
13 – 27 Nov. 2023 (2 weeks) 20 quizzes on the 3 modules (1 h 30 min)