GIA Services Permit Issuers of Debt To:
- Obtain the best credit rating possible
- Minimize borrowing costs in the capital markets
- Understand the critical rating issues
- Anticipate the rating consequences of policy options
- Make highly effective presentations to the agencies
- Take charge of their ratings future
- Work more confidently with outside constituencies
GIA Clients Have Achieved Practical Results From:
- Assistance in preparing both staff and documentation for rating meetings
- Rating confirmations while on Review for possible downgrade
- Strategies for achieving an upgrade
- A structure for managing the rating process on a year-round basis
- Continuing access to GIA expertise
Why Use GIA?
- GIA is the only international consulting firm that
- Devotes full time to rating agency advisory
- Is independent with no underwriting conflict of interest
- Has decades of rating agency management and analytical experience
- Comprises senior specialists, not junior generalists
Since 1991 GIA has been retained by numerous clients, including national governments, state/provincial issuers, regional
banks, and corporations. GIA has retainer relationships with some clients and has worked with others three or four times —
sure indicators of value added. GIA helped one government achieve a confirmation of its rating when it was on Review for possible
downgrade by Moody’s. We helped four sovereigns obtain higher investment-grade ratings.
- A sample of GIA clients includes
- A European Ministry of Finance working for an upgrade from S&P
- A state/provincial borrower working for an upgrade from Moody’s
- A South American sovereign seeking a first-time rating
- A private Australian bank to achieve a higher investment-grade credit rating
- A USAID-funded project to determine the feasibility of a credit bureau in a Southeastern European country
- A USAID-funded project to create local rating agencies in two Eastern European countries
- A sub-Saharan African country seeking to determine if a national development bank should be created
- An Icelandic credit information service seeking to invest in various European countries
- A World Bank-funded project to rationalize a counter-productive regime of regulations hampering the development of the
local rating agency industry in a Latin American country
- A state-owned financial institution in the process of privatization
- An international corporation seeking an exception to the sovereign ceiling rule
- A consumer goods company under rating pressure due to acquisitions
- A private firm, assessing its debt capacity within the present capital structure without jeopardizing existing ratings
- A bank facing an unsolicited rating from Moody’s
- GIA works on a strictly confidential basis and can be completely trusted with sensitive information. Clients’ names
- You will not find another consulting firm anywhere that offers GIA’s independent credentials, agency insights, and
variety of programs relative to the rating agencies. GIA is unique.
Differences Between GIA and the Investment Banks
There is a clear distinction between
the rating agency advisory service that investment bankers provide to international issuers of debt and what GIA can provide.
Our roles, credentials, agenda, and approach are strikingly different.
Roles: Bankers provide valuable advice on financing options and market conditions, and they fulfill an
important cross-border dealer-broker function. GIA, by contrast, does not attempt to compete with the bankers in their strong
suit. We compete with them in their weakest area—ratings advisory where GIA has the comparative advantage.
Credentials: Many bankers advising issuers have not had rating agency experience, and have not sat on
rating committees. They do not really know how the agencies function, and they don’t have time to keep up to date with
GIA, on the other hand, is comprised of former agency analysts and officers; we know how the
agencies think and operate. We can advise you on the best way to prepare for a new rating and a rating meeting. We maintain
regular access to the analysts at all the rating agencies. We produce a monthly newsletter on agency thinking and practice.
We keep up to date on ratings.
Independence: The primary motivation of investment banks is to earn revenue through underwriting and trading
activities. Their agency advisory team is designed to generate future underwriting business. GIA has no ulterior motive behind
the advice we offer, and we have no potential conflict of interest. We are interested only in serving the issuer’s rating
agency needs, so our agenda is clearer and simpler.
GIA’s independent status actually offers clients greater
flexibility in the future over their choice of investment banks for underwriting and lead managing roles; clients can base
these decisions on questions of pricing and on a bank’s distribution capabilities rather than on their agency advice.
Confidentiality: As GIA has no links to commercial banks or investment banks, clients can be assured that
their proprietary and competitive information will remain confidential and will not be divulged to third parties.
Approach: GIA devotes its entire effort to rating agency advisory, and as a specialist firm with a select
client base, we will spend as much time as required to provide the service you need. We are full-time specialists in rating
agency activities, not part-time generalists.
Advice from the investment banks tends to follow the "benign/mechanistic"
approach to dealing with the agencies, that is, follow a few simple rules and accommodate the agencies’ demands. GIA’s
approach is of the "realistic/assertive" school; we believe that better ratings come from a more proactive approach, taking
charge of the relationship with the agencies, and not sitting back and letting the process unfold over you.
Costs and Fees: Investment banks are high-cost, high-fee operations that usually offer agency advice as
a "loss leader" to help induce other business from clients. GIA is a low-cost, low-overhead operation that specializes in
one area and charges modest fees—especially compared to the potential return to the issuer. We have a variety of programs
and a flexible fee structure that can be adapted to each client’s needs.
Other GIA Services
In addition to GIA's primary business of advising issuers
on their credit ratings, we have helped clients in related fields:
- Setting up Rating Agencies
GIA has worked with officials in Poland, Hungary, Turkey, Bhutan, Bahrain and Russia to introduce local rating agencies.
Activities included initial feasibility studies, advice on the appropriate legal framework, training analysts, writing credit
reports, participating in rating committees, giving speeches and seminars to local and foreign investors and clients, and
introducing rating agency officials to the major rating agencies in New York City.
- Working with Multilateral
GIA has worked with development banks in Africa and Europe to improve their credit ratings
and regain their AAA's. We also advised the Ministry of Finance in Namibia about the underlying needs, conditions and
prospects for creating a local development bank.
- Training in Municipal Finance
has undertaken projects related to municipal finance in Poland and Russia, assessing the creditworthiness of subnational governments
and training local analysts in muni finance methodology. Projects in the pipeline involve working with municipal officials
in Southeastern Europe and the CIS to improve financial transparency and achieve greater access to funding.
Global Investment Advisors, Inc. is ready to structure a program that meets your specific requirements.