BUDAPEST, HUNGARY, June 28, 1999 – The International Finance Corporation signed an agreement today to invest in a Hungarian company which will offer a full range of credit rating services that will encourage future investments in Hungary.
IFC will make a 20 percent equity investment of up to US$100,000 in DCR Hungarian Credit Rating Co. (DCRH), which will use internationally accepted standards to provide all types of credit rating services for the Hungarian market.
The technical partner of the credit rating agency will be Chicago-based Duff & Phelps Credit Rating Co. (DCR), which has offices in 26 countries around the world.
Other partners in establishing DCRH are HVG Kiadoi Rt., an independently owned publisher of the leading Hungarian economic news magazine, Heti Vilaggazdasag; and PlanEcon, a consulting company specializing in economic and industrial analysis in Central-Eastern Europe and the former Soviet Union.
At the signing ceremony, Mr. Harold Rosen, Director of IFC's Central and Southern Europe Department, said that improving credit rating services in Hungary would provide investors with an objective risk evaluation of debt securities and lead to greater transparency and investor protection. He added that the comfort afforded by the credit rating agencies in Hungary should make savers more willing to invest in corporate debt instruments, as well as offering more credit-worthy borrowers a relatively lower cost, and developing a healthy corporate debt market.
DCRH will be part of a regional network including IFC's recent investments, alongside DCR, in similar companies in Czech Republic and Turkey.
The mission of IFC, part of the World Bank Group, is to promote private sector investment in developing countries, which will reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses.
