KATHMANDU: As per the need for credit rating for issuers of certain type of debts, Himalayan Infrastructure Fund (HIF) here is all set to bring a Credit Rating Agency (CRA). According to HIF director Maheshwor Shrestha, due to the need for World Trade Organisation permission regarding foreign company establishment in Nepal and with the subsequent establishment of big companies here, CRA is needed. “CRA plays a vital role in guiding issuers about appropriate investments and general information about IPOs,” said Shrestha adding that currently people now very little about IPOs. Once CRA is set up, the hazards related to balancesheets will be over as CRA will assign ratings and categorise the IPOs. There will not be much risk regarding new dealings, said Shrestha adding that any foreign company can make enquires regarding the company ratings here. “ We are soon going to sign a Memorandum of Understanding(MoU) with Indian Credit Rating Agency (ICRA) which will have 51 per cent share. ICRA is the associate company of Moody’s in India which will be our partner in Nepal,” said Shrestha. Talking about Nepal, he said, “Nepal has diverse shareholders with eminent professionals and financial instiutions like Nepal Investment Bank Ltd, Standard Chartered Bank, Everest Bank Ltd, Nepal SBI Bank as the promoters of the CRA in Nepal.” Rating is very important and the financial instituions here want to be transparent and professional, added Shrestha. A credit rating agency is a company that assigns credit ratings for issuers of certain types of debt obligations as well as the debt instruments themselves. In some cases, the servicers of the underlying debt are also given ratings. In most cases the issuers of securities are companies, special purpose entities, state and local governments, non-profit organisations or national organisations or national government issuing debt like securities like bonds that can be traded in the secondary market. A credit rating for an issuer takes into consideration the issuer’s credit worthiness — its ability to pay back a loan and — affects the interest rate applied to the particular security being issued.