Policy on Compensation Arrangements

The process of initiating a credit rating begins when an issuer or their representative contacts the BD Team for credit rating services. We rely on our BD Team to identify potential clients seeking credit ratings. The fee structure is transparently communicated and finalised before commencing the rating assignment. Typically, BWR charges an initial rating fee at the beginning of the rating exercise, followed by an annual surveillance fee for the duration of the valid rating period. The specific fee is determined based on various factors, including the principal amount of the securities or facilities and the complexity of the assignment.

BWR may offer alternative fee structures for some specific cases, such as volume issuers or groups. The BD Team independently sets the rating fees according to the standard rate card provided. Once the issuer signs the Brickwork Ratings - Client Agreement, they submit the required initial information along with the necessary rating fees.

Brickwork Ratings (BWR) derives its compensation from issuers through assigning ratings to their securities, instruments, bank loans and facilities. The rated entities pay fees to BWR based on a mandate rating letter. The factors and features of the nature of the compensation are provided as under:

1. BWR receives its fees from the issuers for rating their securities/bank loans/facilities. BWR’s fee structure consists of initial rating fees and an annual surveillance fee charged for the subsequent monitoring till the securities/loan facilities remain outstanding or withdrawn.
2. The fees are essentially based on the complexities of an instrument, size or type or efforts involved and any other factor that may be considered relevant by BWR. However, fee structures are finalized before accepting an assignment.
3. BWR’s ratings are available on its website and disseminated widely through various media channels, for which no fees are charged at present.
4. BWR compensation structure for rating bank loans / facilities as required under RBI instructions vide DBOD. BP. No. /5379/21.06.007/2012-13 dated April 26, 2013, is as under:
5. Compensation structure of BWR is as under:
   1. For rating bank loans / facilities:
      1. Initial Rating Fees shall be up to 10% for unrated Bank facilities subject to the minimum amount of Rs 40000/.
      2. Annual Surveillance fee would range between 35% - 70% of the initial rating fee, per annum with a minimum of Rs 30000/.
      3. The above minimum fee is not applicable for bulk deals, bidding for tenders, Northeast business entities, SSI units, etc.
      4. All applicable taxes and levies will be extra.
   2. For other instruments such as NCD / Bonds / CP, :
      1. BWR shall ordinarily charge an Initial Rating fee of up to 1% of the issue size.
      2. Annual surveillance fee would range between 35% - 70% of the initial rating fee.