/raid1/www/Hosts/bankrupt/TCRLA_Public/250129.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, January 29, 2025, Vol. 26, No. 21
Headlines
A R G E N T I N A
ARGENTINA: Slashes Export Taxes to Rescue Drought-Hit Farmers
B A H A M A S
BAHAMAS: IMF Says Electricity Reform Can Usher in Growth
B R A Z I L
AMBIPAR PARTICIPACOES: S&P Assigns Prelim. 'BB-' Rating on Bonds
BANCO PAN: S&P Withdraws 'BB/B' Issuer Credit Rating
BRAZIL: Beef Firms Breathing Easy Over Prospect of Trump Tariffs
C H I L E
WOM SA: Can Use Chapter 11 Plan Disclosure
C O L O M B I A
COLOMBIA: S&P Affirms 'BB+' Foreign Curr. Sovereign Credit Rating
COMPANIA DE MINAS: S&P Rates Up to $650MM New Unsec. Notes 'BB-'
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: U.S. Mass Deportations Could Impact Economy
G U A T E M A L A
BANCO INDUSTRIAL: S&P Affirms 'BB/B' ICRs & Alters Outlook to Pos.
P E R U
BANCO INTERNACIONAL DEL PERU: S&P Rates Subordinated Notes 'BB+'
P U E R T O R I C O
NEOLPHARMA INC: Case Summary & 20 Largest Unsecured Creditors
SILVER AIRWAYS: Court Extends Use of Cash Collateral Until Jan. 30
- - - - -
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A R G E N T I N A
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ARGENTINA: Slashes Export Taxes to Rescue Drought-Hit Farmers
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Buenos Aires Times reports that Argentina slashed taxes on its
major crops that provide billions of dollars in export revenue as
it seeks to throw a lifeline to farmers wrestling with a drought
and low global prices.
The government of President Javier Milei cut tariffs on exports of
soy meal and oil to 24.5 percent from 31 percent, according to
Buenos Aires Times. The levy on unprocessed beans was cut to 26
percent from 33 percent, the report notes. The tax on corn was
reduced to 9.5 percent from 12 percent, the report relays. There
were cuts for other major crops, including wheat, barley and
sunflowers, the report says.
"We thought this display of solidarity was very important given
farmers' situation," said Economy Minister Luis Caputo at a news
conference. "We're seeking nothing other than justice," he added.
Argentina has taxed shipments for years as a way to fund bloated
government budgets, even though it's held back development of key
export industries and, especially, beleaguered farmers, the report
discloses. Milei is on a crusade to slash spending, but Caputo
said they still aren't in a position to afford a blanket, permanent
removal of the export taxes, the report says.
The policy will go into effect January 27 and will last for most of
the harvest, with the bulk of fieldwork done in the second quarter,
the report discloses. The taxes would be scheduled to go back up
in July, the report says. That will spur farmers to trade their
soy and corn straight away, beefing up Central Bank dollar reserves
that Milei needs to help stabilise the economy ahead of midterm
elections, the report relays.
Growing reserves is also a key issue in talks that Argentina is
holding now in Buenos Aires with the International Monetary Fund
(IMF) for a new program to succeed the current US$44-billion deal,
the report discloses. A sticking point is Argentina's
foreign-exchange policy, whereby inflation outpaces the
government's monthly peso depreciation, the report says.
The resulting strong peso, low global crop prices and the drought
are eating into farmers' profit margins, with many operating at a
loss this season, the report notes. In essence for them, the tax
breaks are a compensation mechanism, the report relays.
For global crop traders, the policy boosts the competitiveness of
Argentine food shipments against rivals like neighboring Brazil,
the report relays. Argentina is usually the world's biggest
exporter of soy meal and oil, and the third-biggest supplier of
corn, the report discloses.
"This is crucial for farmers at a time when global prices are low
and there are regions suffering a bad drought," Sergio Iraeta, the
government's agriculture chief, said at the conference. "I hope it
rains," he added.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
In March 2022, the International Monetary Fund (IMF) approved a new
30-month arrangement under an Extended Fund Facility for Argentina
in the amount of SDR 31.914 billion (equivalent to US$44 billion,
or 1000 percent of quota). The IMF Executive Board's decision
allowed the authorities an immediate disbursement of an equivalent
of US$9.65 billion in March 2022.
Argentina's IMF-supported program seeks to improve public finances
and start to reduce persistent high inflation through a
multi-pronged strategy, involving a gradual elimination of monetary
financing of the fiscal deficit and enhancements in the monetary
policy framework.
In June 2024, the IMF Board completed an eighth review of the
Extended Arrangement under the Extended Fund Facility for
Argentina. The IMF Board's decision enabled a disbursement of
around US$800 million to support the authorities' efforts to
entrench the disinflation process, rebuild fiscal and external
buffers, and underpin the recovery.
On Jan. 8, 2025, Moody's Ratings raised Argentina's local currency
ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1
from Caa3. Moody's said the decision to raise the local and
foreign currency ceilings reflects the increased predictability and
the greater consistency in economic policy that has led to a rapid
reduction in monetary and fiscal imbalances that were stoking very
high inflation.
On Nov. 15, 2024, Fitch Ratings upgraded Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'CCC' from 'CC',
and its Long-Term Local-Currency IDR to 'CCC' from 'CCC-'.
Argentina's upgrade to 'CCC' from 'CC' reflects developments that
have improved Fitch's confidence in the authorities' ability to
make upcoming foreign-currency bond payments without seeking relief
of some sort.
S&P, in March 2024, raised its local currency sovereign credit
ratings on Argentina to 'CCC/C' from 'SD/SD' and its national scale
rating to 'raB+' from 'SD'. S&P also raised its long-term foreign
currency sovereign credit rating to 'CCC' from 'CCC-' and affirmed
its 'C' short-term foreign currency rating. The S&P ratings have
been affirmed as of August 2024. S&P said the stable outlook on
the long-term ratings balances the risks posed by pronounced
economic imbalances and other uncertainties with recent progress in
making fiscal adjustments, reducing inflation, and undertaking
structural reforms to address long-standing microeconomic
weaknesses that have contributed to poor economic performance for
many years that it would likely consider to be distressed.
DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local
Currency Issuer Ratings to B (low) from CCC on November 25, 2024.
The trend on all ratings is Stable.
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B A H A M A S
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BAHAMAS: IMF Says Electricity Reform Can Usher in Growth
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Zamid Aligishiev, Beatriz Garcia-Nunes, Shane Lowe, economists and
analysts at the International Monetary Fund (IMF), relates that
modernizing electricity grids and increasing the shares of solar
energy and liquified natural gas (LNG) in electricity production
can yield major macroeconomic benefits in The Bahamas. Such
transformations, over the medium-term, could reduce fossil fuel
imports, decrease the country's vulnerability to volatile global
fuel prices, significantly reduce CO2 emissions, and substantially
boost national output (eventually increasing long-run growth
potential from 1.5 percent to 2 percent). These are just some of
the many interesting findings using the IMF's new Renewable Energy
Balance of Payments tool. This tool estimates the impact of a
shift in the mix of energy production on a country's transactions
with the rest of the world.
An Ambitious Energy Transformation
For years, Bahamians have suffered from frequent power outages,
while the reliance on imported fossil fuels - one of the highest in
the Caribbean - for electricity generation leaves consumers and
businesses vulnerable to high and volatile energy prices.
To address these hardships, the government announced plans in June
2024 to, in partnership with the private sector, invest in a modern
electricity transmission and distribution infrastructure and to
increase the share of renewable energy in its mix of electricity
generation. Specifically, the government is taking advantage of
the abundance and intensity of solar energy available to The
Bahamas all year round by increasing the share of solar energy to
30 percent by 2030. Investing in solar also minimizes the adverse
environmental impact and logistical challenges associated with
other forms of energy. A small share of electricity will still be
produced using diesel, but much will be replaced with cleaner LNG.
While a transformation of this magnitude can be expensive, the
government's partnerships with private power producers and
investors can help The Bahamas to achieve its mitigation goals. The
transition to a greener electricity mix, while meeting growing
electricity demand, requires multi-year investments which are
expected to be financed by the private sector. However, carefully
managing fiscal risks will be necessary to avoid adding to the
government's already-highly public debt.
Investing in Resilience
Unfortunately, even with these investments, the threat of climate
change is here to stay. IMF analysis suggests that rising sea
levels could place up to 41 percent of the land in The Bahamas and
22 percent of its population below sea level by the end of this
century. Moreover, the country is positioned within the Atlantic
hurricane belt, leaving it at high risk of hurricane damage. Left
unaddressed, more severe natural disasters and slow-moving impacts
from climate change could reduce The Bahamas' national output by up
to 11 percent by 2100, with larger losses in the islands whose
economies rely most on hospitality and real estate.
Given these risks, investing in The Bahamas' capacity to adapt to
climate change and preserve its natural capital could increase
national output by up to 9 percent over the long-term, including
through sustainable tourism. Building resilience to climate change
would require diversifying away from vulnerable activities as well
as undertaking investments to protect physical assets and natural
capital (for example, breakwater construction, coral reef and
mangrove protection, and beach nourishment programs).
Investing in climate resilience can be expensive, with financing
needs exceeding those of the energy transformation. Fortunately,
the ongoing electricity sector reform, if executed successfully,
can serve as a blueprint for how countries can partner with private
businesses to finance climate adaptation. Moreover, innovative
financing solutions, including by refinancing expensive debt with
cheaper funding, could free additional public resources to preserve
the country's natural habitats. The private sector can play a
vital role in financing climate resilience, working hand-in-hand
with the public sector and supported by the international community
(including in the form of grants). By working together, this trio
of partners can help small states like The Bahamas secure a
prosperous future for their citizens and protect their natural
beauty and capital for future generations to enjoy.
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B R A Z I L
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AMBIPAR PARTICIPACOES: S&P Assigns Prelim. 'BB-' Rating on Bonds
----------------------------------------------------------------
S&P Global Ratings revised the outlook on Ambipar Participacoes e
Empreendimentos S.A. (Ambipar) to positive from stable. S&P also
assigned a 'BB-' preliminary issue rating and a recovery rating of
'3' to Ambipar Lux S.a.r.l.'s proposed bond. At the same time, S&P
affirmed its 'BB-' long-term issuer credit rating on Ambipar, as
well as the 'BB-' issue rating on Ambipar Lux's existing bond due
2031.
S&P said, "The positive outlook reflects our view that we could
upgrade Ambipar in the next 12-24 months if it maintains debt to
EBITDA of up to 3.0x, funds from operations (FFO) to debt of more
than 20%, and positive free operating cash flow (FOCF) to debt
thanks to increasing cash flow and a prudent approach to leverage.
"The positive outlook reflects our expectation of improvement in
the company's cash flow due to a reduction in investments and
acquisitions, and the continuing optimization of its asset base. In
2024, Ambipar enhanced its operating efficiency through the
unification of service centers, reduced costs, and tax payments,
streamlining the corporate structure, and broadening its service
offerings. These factors have bolstered cash generation and margins
in the past few quarters. Furthermore, Ambipar has halted
acquisitions and large investments and is shifting to an
asset-light strategy, as seen in the recent demobilization of
assets, selling its used fleet -- mainly yellow-line assets and
heavy-duty vehicles -- and shifting to a leased fleet.
"As a result, the main credit metrics improved, as seen in adjusted
debt to EBITDA and FFO debt at 4.0x and 7.0%, respectively, for 12
months ended September 2024, versus 4.5x and 3.8% for the same
period in 2023. Given our base-case scenario of a 10%-13% revenue
growth for 2025 and 2026 thanks to the expanding operations of
Ambipar's both divisions, we anticipate adjusted debt to EBITDA to
improve to 3.0x by the end of 2025 and to about 2.5x in 2026. We
expect lower capital expenditure (capex) and acquisitions than in
prior years, given Ambipar's focus on its existing assets.
Investments will be mainly for expanding the existing facilities,
equipment, and maintenance, leading to our expectation of positive
FOCF to debt."
The proposed $500 million bond and the $200 million tender offer
will improve the debt profile. The company expects to issue a
10-year $500 million senior unsecured bond. It also plans to
proceed with the tender offer of its existing 2031 bond, capped at
$200 million and with a premium -- the bond ask price is currently
about $99.75, for which the company will add a 1% premium,
resulting in a tender price of $100.75, a 0.75% premium above par
levels. The tender offer depends on the new issuance. Therefore, if
the latter won't occur, the tender will be cancelled, and its
liquidation will only occur after the new bond takes place. The new
bond will have the same structure as that of the 2031 bond in terms
of the issuer, guarantors, covenants, indenture, etc. Ambipar will
use the proceeds to roll over about $200 million in debt from 2031
to a longer maturity, and to repay short- to medium-term debt. As a
result, the company will reduce the maturity concentration in 2031,
extend its debt maturities, decrease its cost of capital, and
diversify its funding sources.
BANCO PAN: S&P Withdraws 'BB/B' Issuer Credit Rating
----------------------------------------------------
S&P Global Ratings withdrew its 'BB/B' global scale and
'brAAA/brA-1+' national scale issuer credit ratings on Banco Pan
S.A. at the issuer's request.
S&P said, "Our ratings on Banco Pan were primarily determined by
the creditworthiness of Banco BTG Pactual S.A. (BB/Stable/B), its
parent. We believe BTG Pactual can provide extraordinary support to
Banco Pan under any foreseeable circumstance. Since BTG Pactual
acquired Banco Pan in May 2021, the latter has been part of the
conglomerate, with its capitalization considered on a consolidated
basis for regulatory purposes.
"At the time of the withdrawal, the outlook on both issuer credit
ratings was stable."
BRAZIL: Beef Firms Breathing Easy Over Prospect of Trump Tariffs
----------------------------------------------------------------
Ana Mano at Reuters reports that Brazilian beef companies do not
expect to be hurt by potential new tariffs from President Donald
Trump's administration because of low inventories of cattle in the
U.S. and a sizable tariff that already exists on these exports.
Roberto Perosa, head of the Brazilian beef exporters association
ABIEC, said in an interview that Brazilian beef exports outside a
65,000-ton annual quota already are slapped with a 26.4% tariff
when entering the U.S., according to Reuters.
His remarks suggest Brazil, the world's largest beef exporter, will
remain a key U.S. supplier despite any protectionist rhetoric from
the Trump administration, the report notes.
Brazilian companies exported $1.3 billion worth of beef products to
the U.S. last year, the report relays.
"I think the U.S. is in a difficult moment relative to its
livestock cycle, and (will remain so) at least for the next two
years," said Perosa, who leads the powerful beef lobby that
represents firms like JBS (JBSS3.SA), opens new tab and Marfrig
(MRFG3.SA), opens new tab, both of which have U.S. operations, the
report discloses.
Brazil exported some 230,000 tons of fresh and processed beef to
the U.S. last year, up almost 66% from 2023, with most of it paying
the hefty tariff, Perosa said, citing trade data, the report says.
Scarcity of cattle in the U.S., where inventories have hit the
lowest level in seven decades, means U.S. buyers will need to
secure a reliable partner for large beef volumes. "That partner is
Brazil," Perosa said, the report discloses.
Brazil has tried to negotiate an increase of the tariff-free quota
to 150,000 tons with the U.S., but the state of the talks is
unclear following Trump's return to the White House earlier, Perosa
said, the report says.
The U.S. is Brazil's second-largest export destination for beef
after China, and is also the South American country's
second-largest trade partner overall, the report relays.
Brazil pays a 12% tariff to export beef to China, which took in
$5.4 billion worth of the South American country's beef last year,
Perosa said, citing trade data, the report notes.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
In October 2024, Moody's Ratings upgraded the Government of
Brazil's long-term issuer and senior unsecured bond ratings to Ba1
from Ba2, the senior unsecured shelf rating to (P)Ba1 from (P)Ba2;
and maintained the positive outlook. S&P Global Ratings raised on
Dec. 19, 2023, its long-term global scale ratings on Brazil to 'BB'
from 'BB-'. Fitch Ratings affirmed on Dec. 15, 2023, Brazil's
Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with
a Stable Outlook. DBRS' credit rating for Brazil was last reported
at BB with stable outlook at July 2023.
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C H I L E
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WOM SA: Can Use Chapter 11 Plan Disclosure
------------------------------------------
Yun Park at law360.com reports that Chilean mobile phone operator
WOM SA received a Delaware bankruptcy court's approval of its
Chapter 11 plan disclosure statement after resolving all objections
from the U.S. trustee and an ad hoc group of noteholders regarding
the plan releases and creditors' rights.
About WOM S.A.
WOM is a Chilean telecommunications provider, focused on offering
mobile voice, data, and broadband services, along with a rapidly
expanding "Fiber to the Home" broadband offering, to consumers and
businesses in Chile. Since the acquisition of Nextel Chile in 2015
through Novator Partners LLP's investment vehicle NC Telecom AS,
WOM has expanded from having virtually no market share to
establishing itself as the second-largest mobile network operator
in Chile.
WOM sought relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Del. Lead Case No. 24-10628) on April 1, 2024. In the petition
filed by Timothy O'Connoer, as independent director, the Debtor
estimated assets and liabilities between $1 billion and $10 billion
each.
The Honorable Bankruptcy Judge Karen B. Owens oversees the case.
The Debtors tapped White & Case, LLP as general bankruptcy counsel;
Richards, Layton & Finger, P.A. as local bankruptcy counsel;
Riveron Consulting, LLC, as financial advisor; and Rothschild & Co
US Inc. as investment banker. Kroll Restructuring Administration,
LLC, is the claims agent.
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C O L O M B I A
===============
COLOMBIA: S&P Affirms 'BB+' Foreign Curr. Sovereign Credit Rating
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' long-term foreign currency
and 'BBB-' long-term local currency sovereign credit ratings on
Colombia. The outlook on the long-term ratings remains negative.
S&P also affirmed its 'B' short-term foreign currency and 'A-3'
short-term local currency ratings on Colombia.
Outlook
S&P's negative outlook reflects Colombia's mounting fiscal
challenges, with larger-than-expected fiscal deficits creating
worsening public finances and a rising debt burden. Persistently
weak domestic investor sentiment and higher global uncertainty
constrain the country's growth prospects, straining Colombia's
fiscal accounts.
Downside scenario
S&P could downgrade Colombia over the next 12 months if the
government is unable to lower its fiscal deficit, resulting in in
net general government debt growing above 60% of GDP. Consistently
low levels of investment could also lead to lower growth over the
forecast, indirectly pressuring Colombia's fiscal deficit and debt
burden.
Upside scenario
S&P could revise its outlook to stable if the government achieves
meaningful fiscal consolidation, helping to stabilize and lower its
net general government debt burden. Better fiscal performance would
help lower the government's substantial interest burden, adding
fiscal flexibility. Fiscal consolidation, combined with moderate
current account deficits, could gradually strengthen Colombia's
external indicators, supporting greater economic resilience.
Rationale
S&P said, "Our ratings on Colombia are based on its stable
democracy and political institutions, which have sustained
predictable economic policies for many years, despite economic
shocks and transitory domestic uncertainty. They also incorporate
monetary policy flexibility based on inflation targeting and a
flexible exchange rate, which remain key economic buffers against
external shocks.
"Our ratings are constrained by the sovereign's high external debt
and volatile terms of trade, as well as its limited fiscal
flexibility and weakening debt profile."
Institutional and economic profile:
-- Policy uncertainty poses risks for long-term economic growth.
-- Colombia has a stable democracy, division of power, and
adequate checks and balances.
-- However, growing policy uncertainty has resulted in weak
investor confidence.
-- Softer financial conditions and resilient consumption are
supporting stronger economic growth.
Colombia's stable democracy, separation of powers, independent
judiciary, and other checks and balances are likely to sustain
long-term pragmatic and predictable economic policies. Its active
judiciary has often limited the actions of the executive branch of
government.
President Gustavo Petro's ambitious reform agenda has been met with
opposition from much of the country's traditional political
leadership, many of whom are part of his broad multiparty coalition
in Congress. (Political parties in Congress have the incentive to
declare themselves formally as government supporters at the
beginning of each presidential term to be eligible to hold
government posts.) Congress has rejected important pieces of
legislation over the last 12 months, including health and tax
reforms, and the 2025 fiscal year budget.
That said, relevant reforms has been approved and we expect the
government to continue seeking legislation approval. Recently,
Congress passed important reforms to the pension system and to the
General System of Participations (SGP Spanish acronym). The pension
reform is the most significant achievement, transitioning from the
old system that, among other things, provided regressive subsidies,
and broadening pension coverage. The reform also clarifies the
actuarial deficit of the pension system, but it does not touch the
parametric variables of the retirement system. The reform, which
includes a semi-contributory and non-contributory pillar, will add
to long-term fiscal pressures.
The SGP reform significantly increases the share of central
government fiscal revenue to be transferred to lower tiers of
government (from 27.6% to 39.5%). To become effective, Congress
needs to approve a bill by mid-2026 to transfer spending
responsibilities ("spending competence bill") from the central
government to the lower tiers of government. The reform may
moderately boost the general government's fiscal deficit in the
future, but the impact depends on how the spending competence bill
is implemented.
The government is likely to pursue its labor and health care
flagship reforms, which have met much opposition in Congress. The
opportunity to approve these reforms will diminish as national
elections approach (the first round is on May 31, 2026, and the
second round a month later).
Poor security in many parts of the country is adding to domestic
uncertainty as well as limiting economic growth prospects and
adding to fiscal pressures. Since signing the peace agreement with
the largest guerrilla group, FARC (Spanish acronym), in 2016, the
government has failed to regain full control of the zones where the
group operated. Existing criminal groups engage in drug and human
trafficking and illegal mining, among other things, contributing to
a public perception of greater insecurity.
This situation has been exacerbated by the poor economic and social
conditions in neighboring Venezuela, which has become a safe haven
for criminal groups operating in both countries. Armed
confrontations between criminal groups close to the
Colombia-Venezuela border recently displaced around 20,000 refugees
and compelled the Colombian government to end the cease fire and
peace talks with criminal groups. The government also declared a
"state of internal commotion" and "state of economic emergency" to
expedite budget resources to address the security and humanitarian
challenges.
Investor confidence is likely to remain weak over the next few
years. Investment is likely to recover very slowly, with real fixed
investment not surpassing its 2022 peak level until 2027. Economic
growth would mostly be driven by resilient private consumption,
supported by lower domestic and global interest rates that
encourage credit growth, declining inflation, and a strong labor
market strengthening disposable family income.
S&P said, "Following the 0.6% GDP growth in 2023, we estimate that
Colombia's growth was 1.7% in 2024. Resilient consumption and a
muted investment recovery should boost growth towards 2.9% by 2027.
Real per capita GDP growth is expected to average 1.7% over
2024-2027, moderately below the average of countries at a similar
stage of development. We expect GDP per capita at US$7,700 in
2025."
Economic risks are skewed to the downside. Global conditions have
become more uncertain, and growing protectionism is likely to add
inflationary pressures, potentially stalling further cuts on global
and domestic interest rates. In addition, Colombia has lost
significant fiscal freedom over the last 10 years.
Flexibility and performance profile: S&P expects high fiscal
deficits and interest burden
-- Large fiscal deficits will drive the net general government
debt burden to just below 60% of GDP over the next three years and
sustain a high interest burden.
-- Growing service sector exports and remittance income should
moderate the current account deficit. Narrow net external debt is
high but is on a declining trajectory.
-- S&P expects the central bank to conduct monetary policy that
brings inflation to its target by year-end 2025.
An expansionary budget, growing interest burden, an adverse legal
ruling on the prohibition to deduct oil royalties, and overly
optimistic revenue assumptions led to a significant fiscal
deterioration in 2024. S&P said, "We estimate Colombia's general
government deficit at -5.4% of GDP in 2024, compared with -2.3% in
2023. (Our definition for general government includes the central
government, social security systems, a deposit guarantee fund, the
central bank, and local and regional governments.)"
A combination of higher economic growth that supports a moderate
recovery in tax revenues and expenditure cuts aiming to comply with
the fiscal rule should allow for minor fiscal consolidation in
2025-2026.
S&P said, "However, general government primary spending and
interest burden will remain above pre-pandemic levels, and we
expect a general government deficit averaging -4.4% of GDP over
2025-2027. We highlight that the shortfall in revenue collections
in 2024 led the central government to make sizable budget cuts,
including through budget under-execution, to comply with the fiscal
target mandated by Colombia's fiscal rule. While the episode shows
the government's commitment to meeting fiscal rule targets, it also
shows significant gaps between forecast and actual revenues, which
may reappear in 2025."
Colombia's annual increase in net general government debt is likely
to average 5% of GDP over 2024-2027, considering the impact of
inflation and currency depreciation, but moderately decline over
the forecast. Net general government debt is expected to stabilize
just below 60% of GDP over the same period. While S&P expects
domestic and global interest rates to decline, the average cost of
debt would likely stabilize at higher than pre-pandemic levels, and
the government's interest spending is likely to remain above 15% of
general government revenues over the forecast period.
S&P said, "We assess the sovereign's contingent liabilities as
limited. Our assessment of Colombia's financial system, with total
assets estimated at 68% as of 2024, is based on a Banking Industry
Country Risk Assessment (BICRA) of '6'. (Our BICRA groups are on a
scale from 1-10, with '1' denoting the lowest risk and '10' the
highest risk.) The banking sector adopted Basel III capitalization
rules in 2024, adding to the system's resilience. We also expect
lower interest rates to incentivize greater demand for credit in
2025-2026."
The current account deficit (CAD) is likely to stabilize just below
3% of GDP over 2025-2028. The expected CAD is lower than
pre-pandemic levels, mostly reflecting higher remittances and
strong service sector exports (mostly tourism and corporate
services). Despite numerous free trade agreements and logistical
improvements, Colombian goods exports are still concentrated in the
hydrocarbon sector, historically resulting in high terms of trade
volatility.
S&P said, "We expect the CAD to be largely funded by foreign direct
investment, helping narrow net external debt toward 110% of current
account receipts (CAR) by 2028. We expect gross external financing
needs of just below 100% of CAR over 2025-2028.
"Colombia's central bank has a strong record of targeting inflation
and letting the currency float freely. We expect this record to
continue and a renewed board of directors to maintain cautious
policy to anchor inflation expectations. Inflation has been on a
clear downward trajectory since April 2023, and it averaged 6.6% in
2024. We expect inflation to be within the central bank's target of
3% plus/minus 1% by year-end 2025.
"In accordance with our relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the methodology
applicable." At the onset of the committee, the chair confirmed
that the information provided to the Rating Committee by the
primary analyst had been distributed in a timely manner and was
sufficient for Committee members to make an informed decision.
After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.
The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.
The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision. The
views and the decision of the rating committee are summarized in
the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.
Ratings List
Ratings Affirmed
Colombia
Sovereign Credit Rating
Foreign Currency BB+/Negative/B
Local Currency BBB-/Negative/A-3
Transfer & Convertibility Assessment
Local Currency BBB
Colombia
Senior Unsecured BB+
Senior Unsecured BBB-
COMPANIA DE MINAS: S&P Rates Up to $650MM New Unsec. Notes 'BB-'
----------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue rating to Companía de
Minas Buenaventura S.A.A. (BVN)'s proposed senior unsecured notes
of up to $650 million. The notes will be issued with a seven-year
tenor.
BVN (BB-/Stable/--) plans to use the net proceeds from the issuance
to repay its outstanding $550 million senior unsecured notes due
2026. Furthermore, the company may issue up to an additional $100
million for general corporate purposes and to enhance its current
adequate liquidity amid expansion investments.
Under S&P's current base-case forecast, it expects BVN to post
adjusted debt to EBITDA below 2.0x and generate positive
discretionary cash flow over the next three years.
Pro forma the issuance, over 85% of BVN's consolidated debt
obligations will be related to the proposed senior unsecured notes.
The remainder will relate to BVN's outstanding secured bank debt at
the subsidiary level. S&P does not expect incremental debt at BVN's
level or additional debt at the subsidiary level in the short
term.
S&P said, "Our 'BB-' issue rating on the proposed senior unsecured
notes is the same as the issuer credit rating on the company. This
is because the issuance is by BVN, which is at the top of the group
structure, maintaining a debt priority ratio near 10%. Therefore,
we do not believe the company's proposed debt is exposed to
material subordination risk due to its capital structure."
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: U.S. Mass Deportations Could Impact Economy
---------------------------------------------------------------
Dominican Today reports that the economic policies of former U.S.
President Donald Trump, including proposed high tariffs on nations
like China, Mexico, Canada, and the EU, raised concerns for Latin
America, particularly the Dominican Republic. Economist Nelson
Suárez highlighted the potential risks, noting that approximately
2.4 million Dominicans - 22% of the population - reside in the
U.S., with their remittances contributing 8% of the country's GDP,
rivaling the economic impact of tourism, according to Dominican
Today.
According to RC Noticias, Suarez warned that stricter immigration
policies and mass deportations could severely affect undocumented
Dominicans in the U.S., many of whom overstay tourist visas, the
report notes. He emphasized the uncertainty surrounding the number
of Dominicans at risk, urging the government to prioritize this
issue and collect accurate data, the report relays.
Additionally, Suarez advised Dominican authorities to maintain
neutrality in international relations, avoiding alignment with
specific ideological positions until the full impact of U.S.
policies becomes clear, the report discloses. He stressed that
potential disruptions to remittances and migration could jeopardize
the country's economic stability, the report adds.
About Dominican Republic
The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district. Luis Rodolfo
Abinader Corona is the current president of the nation.
TCR-LA reported in April 2019 that Juan Del Rosario of the UASD
Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."
An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.
Standard & Poor's credit rating for Dominican Republic was raised
to 'BB' in December 2022 with stable outlook. Moody's credit
rating for Dominican Republic was last set at Ba3 in August 2023
with the outlook changed to positive. Fitch, in December 2023,
affirmed the Dominican Republic's Long-Term Foreign-Currency Issuer
Default Rating (IDR) at 'BB-' and revised the outlook to positive.
=================
G U A T E M A L A
=================
BANCO INDUSTRIAL: S&P Affirms 'BB/B' ICRs & Alters Outlook to Pos.
------------------------------------------------------------------
S&P Global Ratings revised its outlook on Banco Industrial and
Banco G&TC to positive from stable. At the same time, S&P affirmed
its 'BB/B' issuer credit ratings on both banks.
S&P said, "The positive economic risk trend reflects that we could
revise the economic risk score in our BICRA to a stronger category
if the economic prospects and the banking sector's dynamics remain
favorable. Guatemala has manageable fiscal deficits, very low net
debt, a strong external profile, and a history of sound monetary
policy. As a result, the banking sector has posted significant
credit growth while diversifying its loan book mix. We also expect
nominal credit growth of about 10% for the next two years. The
consumer credit growth averaged 22% for the past three years. Our
projection of double-digit growth for 2025 suggests ongoing
consumer confidence, manageable inflation, and overall economic
stability. Guatemalan banks' asset quality metrics have weakened in
the past 12 months following rapid consumer lending growth.
However, we expect these metrics to remain at manageable levels,
with nonperforming assets stabilizing at about 3.0%, coverage
ratios remaining above 100%, and credit losses below 2% over the
next couple of years.
"If the favorable momentum continues, we could revise our economic
resilience score in our BICRA to a stronger category, improving the
economic risk score to '7' from '8' and the bank anchor to 'bb+'
from 'bb'. Finally, our industry risk score and sub scores remain
unchanged with the stable trend. The latter indicates the room for
improvement in the institutional framework.
"The positive outlook on both banks reflects the positive economic
risk trend in our BICRA. If the positive trend materializes, we
would revise upward the bank anchor to 'bb+' from 'bb', which would
prompt us to revise upward the banks' stand-alone credit profiles
(SACPs). In such a case, the ratings on the banks would be capped
by the 'BB' sovereign rating. In this sense, in order to upgrade
the banks, the positive trend in the economic risk and the
sovereign's upgrade must occur."
BI
The ratings on BI reflect its solid market position as Guatemala's
largest bank, which will continue to support its business
stability. S&P's ratings also incorporate healthy capitalization
levels that translate into a consolidated projected risk-adjusted
capital (RAC) ratio of about 6.5% for the next two years. The
ratings also incorporate the manageable asset quality indicators,
but offset by the above-average dollarization on the bank's balance
sheet, which represents a contingent risk in case of a potential
depreciation of domestic currency. Finally, the bank's deposit base
remains one of its main strengths and provides it with enough
liquidity to face short-term obligations, despite adverse market
conditions.
Outlook
S&P said, "The positive outlook on BI for the next 12 months
reflects its potential upgrade if we were to upgrade the sovereign
to 'BB+' from 'BB', and the positive economic risk trend
materialized. Our outlook also incorporates our expectations that
BI will remain as Guatemala's largest bank, which will continue to
support its business stability. We also expect the bank to maintain
stable internal capital generation, resulting in healthy
capitalization levels. Finally, although we expect pressures on
asset quality indicators due to retail loan growth, we expect them
to remain manageable and stronger than those of its regional
peers."
Downside scenario. S&P said, "We could revise the outlook on BI
to stable in the next 12 months if we were to revise our outlook on
the sovereign to stable. Likewise, if any of the bank's SACP
factors are revised, we could revise the outlook to stable."
Banco G&TC
The ratings on the bank reflect its business stability and growing
operating revenue, supported by its sound market position in
Guatemala. The ratings also incorporate stable interest margins,
and consequently, sufficient internal capital generation to expand
its business, resulting in a consolidated projected RAC ratio of
about 7.4% for the next two years. In S&P's view, the high
dollarization of the bank's balance sheet represents a contingent
risk in case of a depreciation of domestic currency. Nevertheless,
its asset quality indicators are manageable and are in line with
those of regional peers. In addition, Banco G&TC's funding base
relies mainly on deposits from the retail sector, which have been
resilient and stable and provide the bank with enough liquidity to
face its short-term obligations.
Outlook
S&P said, "The positive outlook on Banco G&TC for the next 12
months reflects our view that we could upgrade if we were to
upgrade the sovereign to 'BB+' from 'BB', and the positive economic
risk trend to materialize. Our outlook also incorporates our
expectations that Banco G&TC will maintain a solid market position
in the country, resulting in business stability. We also expect the
bank to maintain stable internal capital generation, resulting in
healthy capitalization. Finally, although we expect asset quality
indicators to continue to slip due to the bank's strategy of
expanding its retail exposure, we believe they will remain
manageable and in line with those of regional peers."
Downside scenario. S&P said, "We could revise the outlook on
Banco G&TC to stable in the next 12 months if we were to revise our
outlook on the sovereign to stable. Likewise, if we revise any of
the bank's SACP factors, we could revise the outlook to stable."
Guatemala BICRA snapshot
To From
BICRA group 7 7
Economic risk 8 8
Economic resilience Extremely Extremely
high risk high risk
Economic imbalances Intermediate risk Intermediate risk
Credit risk
in the economy Very high Very high
Industry risk 5 5
Institutional framework High risk High risk
Competitive dynamics Intermediate risk Intermediate risk
System-wide funding Intermediate risk Intermediate risk
Trends
Economic risk trend Positive Stable
Industry risk trend Stable Stable
Ratings score snapshot
BI
SACP bb
Anchor bb
Business position Strong (+1)
Capital and earnings Moderate (0)
Risk Position Moderate (-1)
Funding and liquidity Adequate/Adequate (0)
Support
ALAC support 0
GRE support 0
Group support 0
Sovereign support 0
Additional factors 0
Banco G&TC
SACP bb
Anchor bb
Business position Strong (+1)
Capital and earnings Adequate (0)
Risk position Moderate (-1)
Funding and liquidity Adequate/Adequate (0)
Support 0
ALAC support 0
GRE support 0
Group support 0
Sovereign support 0
Additional factors 0
Ratings List
Banco G&T Continental S.A.
Ratings Affirmed; Outlook Action
To From
Banco G&T Continental S.A.
Issuer Credit Rating BB/Positive/B BB/Stable/B
Banco Industrial S.A.
Ratings Affirmed; Outlook Action
To From
Banco Industrial S.A.
Issuer Credit Rating BB/Positive/B BB/Stable/B
=======
P E R U
=======
BANCO INTERNACIONAL DEL PERU: S&P Rates Subordinated Notes 'BB+'
----------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' issue rating to Banco
Internacional del Peru S.A.A. -- Interbank's proposed issuance of
$300 million to $400 million (subject to market conditions) of
subordinated 10.25-year (noncall five-year) notes.
S&P rates the notes one notch below the bank's 'bbb-' stand-alone
credit profile (SACP), reflecting contractual subordination. The
rating also incorporates that the notes are nondeferrable and don't
have a mandatory contingent capital clause.
S&P said, "In addition, we assign minimal equity content because
these notes -- considered Tier II by the Peruvian regulator --
don't have characteristics of going-concern contingent capital. We
believe the notes would be subject to a possible write-down only in
resolution.
"Interbank will use the proceeds from the offering for general
corporate purposes, mainly asset-liability management. We consider
the bank's debt maturity schedule to be manageable, and it has a
record of adequate debt management.
"Our rating on Interbank (BBB-/Stable/--) reflects its good
competitive position in the Peruvian financial system, with
widespread brand recognition as a major consumer loan provider in
the country and diversified operations by sector, business segment,
and client type." The bank also benefits from good capitalization
and adequate profitability prospects. Moreover, its access to a
large retail client base supports its stable funding structure,
with a high proportion of deposits and adequate liquidity to cover
short-term needs.
=====================
P U E R T O R I C O
=====================
NEOLPHARMA INC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Neolpharma Inc.
99 Jardines St.
Caguas, PR 00725
Business Description: Neolpharma Inc. is a privately-held company
that specializes in the manufacturing of
pharmaceutical products.
Chapter 11 Petition Date: January 22, 2025
Court: United States Bankruptcy Court
District of Puerto Rico
Case No.: 25-00188
Debtor's Counsel: Carmen D. Conde Torres, Esq.
C. CONDE & ASSOC.
254 San Jose Street
5th Floor
San Juan, PR 00901-1523
Tel: 787-729-2900
Fax: 787-729-2203
Email: condecarmen@condelaw.com
Total Assets: $29,049,165
Total Liabilities: $21,068,886
The petition was signed by Marco A. Monrouzeau Bonilla as
authorized representative.
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/TW2QSYA/NEOLPHARMA_INC__prbke-25-00188__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Luma Energy, LLC Utilities $5,336,741
PO Box 363508
San Juan, PR
00936-3508
2. Autoridad Acueductos Y Utilities $817,051
Alcantarillados
PO Box 70101
San Juan, PR
00936-8101
3. David Kivett Lawsuit $537,052
c/o Brian C. Legrow
717 Constitution Drive
Suite 201
Exton, PA 19341
4. Empire Gas Company, Inc. Propane $493,738
PO Box 363651 Agreement
San Juan, PR 00936
5. Transfuel, LLC Diesel Agreement $455,400
PO Box 711
Mayaguez, PR 00681
6. Crowley LNG Natural Gas $378,218
Puerto Rico, LLC Agreement
c/o Fast Solutions, LLC
Citi Tower
252 Ponce De Leon Avenue
Floor 20
San Juan, PR 00918
7. ECDC Consulting Professional $140,699
Group, LLC Services
PO Box 1343 Production
Trujillo Alto, PR Development
00977
8. Peerless Oil & Lawsuit $129,212
Chemicals, Inc.
Firm Delivery 671
Rd 337
Penuelas, PR
00624-7513
9. Fisher Scientific Lab Material $118,845
PO Box 3648
Boston, MA
00241-3648
10. Alcami Corporation Raw Material $109,128
PO Box 603059 Production
Charlotte, NC
28260-3059
11. Technical Support & Maintenance $96,740
Services, LLC Services
Parque Las Haciendas
Calle Otoau F-11
Caguas, PR 00725
12. MCS Health Medical Plan $88,228
Management Options, Inc. Temination
MCS Laza Suite 160
255 Ponce de Leon Avenue
Hato Rey, PR 00180
13. MM Packaging Packaging $76,809
PO Box 999 Materials
Guaynabo, PR 00969
14. Plan De Salud Agreement $69,415
Menonita Medical Plan
PO Box 364668
San Juan, PR 00936
15. Ernesto Lopez & Professional $59,817
Associates, Inc. Services
898 Munoz Rivera
Ave, Suite 204
San Juan, PR 00927
16. Image Direct-Ideess, Inc. Service $58,696
Suite 140 PMB 458 Provider
Caguas, PR 00725
17. Capsugel Manufacturing Capsul $49,588
PO Box 640091 Provider
500 First Ave.
Pittsburgh, PA
15264-0091
18. Motion Inc. Equipment $47,364
Carretera 2 Km. Provider
16.60
Bo. Candelaria
Toa Baja, PR 00950
19. Beckman Coulter, Inc. Supplies & $43,636
481 California Ave. Equipment
Grants Pass, OR 94526 Provider
20. PVSR Corporation Lawsuit $43,597
PO Box 1548
Vega Baja, PR
00694-1548
SILVER AIRWAYS: Court Extends Use of Cash Collateral Until Jan. 30
------------------------------------------------------------------
Silver Airways, LLC and Seaborne Virgin Islands, Inc. received
interim approval from the U.S. Bankruptcy Court for the Southern
District of Florida, Fort Lauderdale Division, to use cash
collateral until Jan. 30, marking the second extension since the
companies' Chapter 11 filing.
The court previously issued an interim order, allowing the
companies to access the cash collateral of secured lenders until
Jan. 14 only.
Secured lenders, including Brigade Agency Services, LLC, Argent
Funding, LLC, and Volant SVI Funding, LLC were granted replacement
liens on personal property of the companies junior and subordinate
to the carve-out.
As additional protection, secured lenders will be granted a
superpriority administrative expense claim in the amount of any
diminution in the value of their cash collateral.
The next hearing is scheduled for Jan. 30.
Brigade can be reached through its counsel:
Frank P. Terzo, Esq.,
Nelson Mullins Riley & Scarborough, LLP
100 S.E. 3rd Avenue, Suite 2700
Fort Lauderdale, FL 33394
Telephone: 954-764-7060
Fax: 954-761-8135
Email: frank.terzo@nelsonmullins.com
Argent Funding and Volant can be reached through their counsel:
Regina Stango Kelbon, Esq.
Blank Rome, LLP
1201 N. Market Street, Suite 800
Wilmington, DE 19801
Phone: +1.302.425.6400
Fax: +1.302.425.6464
Email: regina.kelbon@blankrome.com
About Silver Airways
Silver Airways, LLC is a regional U.S. airline operating flights
between gateways in Florida, the Southeast and The Bahamas. The
Silver Airways fleet is comprised of modern, state of the art
aircraft with reliable, fuel-efficient turbo-prop engines.
In the summer of 2018, Silver completed the acquisition of Seaborne
Airlines, a San Juan, Puerto Rico-based air carrier serving
destinations throughout Puerto Rico, the U.S. Virgin Islands, and
other countries in the Caribbean. Seaborne provides connections
throughout the Caribbean via the carrier's hub in San Juan, while
also serving as the most critical link between St. Croix and St.
Thomas with the carrier's seaplane operation.
Silver Airways and Seaborne Virgin Islands, Inc. filed Chapter 11
petitions (Bankr. S.D. Fla. Lead Case No. 24-23623) on December 30,
2024. At the time of the filing, Silver Airways reported $100
million to $500 million in assets and liabilities while Seaborne
reported $1 million to $10 million in assets and liabilities.
Judge Peter D. Russin oversees the cases.
The Debtors are represented by:
Brian P. Hall, Esq.
Tel: 404-815-3537
Email: bhall@sgrlaw.com
*********
S U B S C R I P T I O N I N F O R M A T I O N
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