The tariff shows both an interval and a standard premium rate. Guarantees for smaller transactions are often priced at the standard rate. Guarantees for larger transactions are more usually priced within the entire interval. Degree of cover, currency and credit interest rate level affect the annual premium rate allocated. In debtor category A, there is no interval. For this category, the OECD-agreed minimum premium rate applies, according to a calculation model that takes neither currency nor credit interest rate into account.
The premium applied and debtor classification is determined by the transaction as a whole. This means that premium and debtor category are not only affected by the country risk category and the borrower’s own creditworthiness, but also by the amount, how the transaction is structured, and the security offered. Consequently, depending on the amount and the structure, the premiums for two transactions involving the same company can be set differently.
Country risk category 0 - 7 Debtor category A - F
|
|
A+ SOV+ |
A SOV/CCO |
B CC1 |
C CC2 |
D CC3 |
E CC4 |
F CC5 |
0 |
Standard Intervall |
5
|
15 10-25 |
35 25-55 |
95 55-150 |
190 150-240 |
330 240-500 |
|
1 |
Standard Intervall |
MPR-10% (6) |
MPR (7) |
15 MPR-35 |
45 35-80 |
130 80-160 |
220 160-260 |
350 260-500 |
2 |
Standard Intervall |
MPR-10% (25) |
MPR (28) |
45 MPR-55 |
75 55-110 |
140 110-170 |
230 170-270 |
370 270-500 |
3 |
Standard Intervall |
MPR-10% (52) |
MPR (58) |
75 MPR-110 |
120 110-150 |
170 150-210 |
250 210-320 |
390 320-500 |
4 |
Standard Intervall |
MPR-10% (113) |
MPR (126) |
150 MPR-160 |
170 160-180 |
190 180-250 |
290 250-360 |
430 360-500 |
5 |
Standard Intervall |
MPR-10% (158) |
MPR (176) |
200 MPR-210 |
220 210-230 |
240 230-300 |
310 300-390 |
440 390-500 |
6 |
Standard Intervall |
MPR-10% (198) |
MPR (220) |
240 MPR-260 |
280 260-290 |
300 290-330 |
360 330-410 |
460 410-500 |
7 |
Standard Intervall |
MPR-10% (249) |
MPR (277) |
310 MPR-320 |
340 320-350 |
360 350-400 |
430 400-450 |
480 450-500 |
Risk class A is based on the minimum premium rate (MPR) permitted by the OECD.
The debtor in a transaction is placed in a category from A to F. Category A contains the country’s strongest debtors. Category F contains the weakest. Below is a description of how debtors are usually categorised. However, companies, banks and public borrowers can be placed in any category.
A - |
Central bank/Ministry of Finance etc. |
B - |
Central government agencies and ministries, state-owned banks etc. |
C - |
First class companies, normal banks, other public debtors |
D - |
Normal companies, weak banks |
E - |
Weak companies, project risks with certain types of collateral |
F - |
Newly established/weak companies, project risks |