Fitch Ratings has published an exposure draft for its Infrastructure & Project Finance Master Rating Criteria.
Most notable is a proposal to introduce Recovery Ratings (RRs) as a separate indicator as part of Fitch’s infrastructure analysis. RRs for infrastructure will be available upon request by a mandating issuer or investor.
Fitch’s RRs in infrastructure will apply to a company/investor that would want to investigate the likely recovery prospects of a debt instrument upon default, irrespective of the asset being in operation or construction phase.
Fitch has developed this proposed framework after fielding questions from investors about the value of RRs for infrastructure and project-finance ratings. Similar to the ones used for its Corporate ratings, Fitch’s infrastructure RRs will be graded from RR1 to RR6.
Once infrastructure RRs are formally implemented, Fitch anticipates a negligible amount of rating actions equally distributed between u