Telus 2014 Annual Report Download - page 32

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32
Institution Rating
Obligations rated Baa are judged to be medium-grade and subject to
moderate credit risk and as such may possess certain speculative
characteristics.
Moody's appends numerical modifiers 1, 2, and 3 to each generic rating
classification from ‘Aa’ through ‘Caa’. The modifier 1 indicates that the
obligation ranks in the higher end of its generic rating category; the modifier
2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in
the lower end of that generic rating category.
Fitch 'BBB' ratings indicate that expectations of default risk are currently low. The
capacity for payment of financial commitments is considered adequate but
adverse business or economic conditions are more likely to impair this
capacity. The modifiers "+" or "-" may be appended to a rating to denote
relative status within major rating categories. Such suffixes are not added to
the 'AAA' Long-Term rating or to Long-Term rating below ‘B’.
As is common practice, during the last two years, each of the above-noted credit rating
agencies charged TELUS for their rating services which include annual surveillance fees
covering our outstanding long-term and short-term debt securities, in addition to one-
time rating fees for certain agencies when debt is initially issued. We reasonably expect
that such payments will continue to be made for rating services in the future.