The determinants of issuers’ long term credit ratings : American S&P500 index


  • ِِAfef Feki Krichene Ph. D in accounting and Finance in IHEC Sfax-Tunisia
  • Walid Khoufi Professor in Finance in IHEC Sfax-Tunisia





Credit Ratings, Determinants, Interest and Debt Coverage, Ordered Probit Model.


In this paper, we examine the impact that various financial and business profile variables have on credit ratings issued for the S&P500 firms by Moody’s. Our ordered probit model indicates that firms’ financial policy, size, liquidity, interest and debt coverage have the most pronounced effect on credit ratings. Our results show that different coefficients are associated to the increments of interest and debt coverage ratios. Business profile variables are not significant. Liquidity variable is also a significant determinant of the issuer long-term credit rating and not just the short term one.


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