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250530.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 Friday, May 30, 2025, Vol. 26, No. 108 Headlines A R G E N T I N A ARGENTINA: Locals Hesitant to Part With Their "Mattress Dollars" ARGENTINA: Signals to Investors IMF Cash to Come Despite Reserves B A H A M A S SANDALS BAHAMAS: Owes Inland Revenue US$30.8 Million in Back Taxes B R A Z I L AZUL SA: Establishes Special Independent Committee AZUL SA: S&P Downgrades ICR to 'D' on Bankruptcy Filing UNIGEL PARTICIPACOES: S&P Affirms 'CCC' ICR on Liquidity Pressures J A M A I C A ERC MANUFACTURING: Unsecureds to Split $120,000 Over 5 Years JAMAICA: BOJ Strengthens Liquidity Requirements for Banks P U E R T O R I C O PUERTO RICO: New Fortress Energy Barred From Power Auction T R I N I D A D A N D T O B A G O UTC: Net Profit Drops 67% to $19 Million for 2024 - - - - - ================= A R G E N T I N A ================= ARGENTINA: Locals Hesitant to Part With Their "Mattress Dollars" ---------------------------------------------------------------- AFP News relays that Argentinian locals are hesitant to part with their so-called "mattress dollars" amidst President Javier Milei's plan to encourage to encourage Argentines to bank those dollars. According to the report, the Argentinian government estimates there are about US$200 billion so-called "mattress dollars" out there – five times the reserves of the Central Bank. These dollars are know to be stashed by locals under under floor boards, in safety deposit boxes or offshore accounts. Under Milei's program, anyone can make a deposit of up to 100 million pesos (about US$90,000) without having to declare the provenance, the report relays. The goal is to boost foreign reserves, stimulate the formal economy and bolster the peso, the report discloses. But Rita Lopez, a local, remains sceptical, the report relays. "The one who kept his savings [in the bank] was my father, he always lost, it always went bad for him," she said, the report notes. One of the worst moments, said Ms. Lopez, was in 2001 when the then-government put in place so-called "corralito" measures to limit cash withdrawals and freeze bank accounts, the report further relays. The report cites that countless people lost life savings as the Argentina system collapsed over and over, inflation spiraled out of control, and governments imposed currency controls. The report adds that their fingers burnt, many Argentines took to trading their battered pesos for whatever greenbacks they could lay their hands on, and hoarding them at home -- thus the term "mattress dollars". Milei has imposed strict budget-cutting measures on the country since taking office in December 2023, and maintaining a stable exchange rate is one of this chief goals, the report says. However, some fear the "mattress dollar" concessions will abet money laundering, the report avers, though the government has denied this. investing.com says that with all these, locals are hesitant to part with their dollars. They worry that the government says one thing at one time, and does another thing at another time. 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 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) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. ARGENTINA: Signals to Investors IMF Cash to Come Despite Reserves ----------------------------------------------------------------- Zijia Song & Kevin Simauchi at Bloomberg News report that Argentine officials signalled to investors in London they expect to receive a US$2-billion disbursement from the International Monetary Fund (IMF) next month regardless of whether they miss a target for rebuilding foreign reserves just a few months into a new program. Investors who attended the May 14 meeting with Central Bank Governor Santiago Bausili and Economic Policy Secretary Jose Luis Daza left with the impression that the government would receive the next disbursement in the IMF program that totals US$20 billion, even though neither man explicitly said so, according to people who were present and asked not to be named because the meetings were private, according to Bloomberg News. As part of the new program announced in April, Argentina's monetary authority agreed to accumulate some US$4.4 billion in net international reserves between the end of March and mid-June, Bloomberg News relays. But the Central Bank's total reserves have actually ticked down since the IMF disbursed US$12 billion in April, and President Javier Milei dismissed the need to build up reserves in a podcast interview earlier this month, citing Argentina's floating exchange rate, Bloomberg News notes. The Economy Ministry's press office denied the officials commented on the next disbursement, but didn't provide any more detail, while the Central Bank didn't immediately respond to a request for comment. The IMF referred to chief spokesperson Julie Kozack's comments in a press conference, Bloomberg News discloses. "There is a shared recognition with the authorities about the importance of strengthening external buffers and securing a timely re-access to international capital markets," Kozack told reporters, Bloomberg News says. While Argentine central banks in the past have tried to build up reserves by buying dollars in the official exchange market, Milei's economic team chose not to intervene in the peso as long as it floats within a range that started at 1,000 to 1,400 pesos per US dollar last month and gradually widens, Bloomberg News relays. Instead, officials have floated the idea of building reserves via debt sales, such as possibly issuing peso-denominated bonds that can be bought with dollars or another repurchase agreement, Bloomberg News notes. The peso currently trades at a level of 1,135 per dollar, according to pricing data compiled by Bloomberg. While Wall Street has cheered Milei's efforts at eliminating some of the country's currency controls, investors have also expressed caution over the government's dismissal of the need to stockpile hard-currency reserves — ammunition Argentina needs to make payments to sovereign bondholders and to defend the peso, which has already lost more than nine percent against the dollar so far this year, Bloomberg News discloses. "If the program is working, as it's working now, then that metric is not going to be a problem," Economy Minister Luis Caputo said at a business conference in Buenos Aires, referencing reserves accumulation, Bloomberg News relays. "We could accumulate reserves not only through the Central Bank buying at the floor of the bands, but through the capital account." "And the economic programme is working very well, so we will be the example country for the next 20 years," he added. Argentina's 23rd IMF program comes after the previous deal before Milei veered dramatically off course, forcing IMF leaders to approve waivers to the leftist government at the time for missing targets in that program — and to disburse more money. Accumulating reserves has been a weakness of Argentina's last two IMF programmes as the currency suffered one selloff after another over the years in either official and parallel exchange markets, Bloomberg News adds. 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 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) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. ============= B A H A M A S ============= SANDALS BAHAMAS: Owes Inland Revenue US$30.8 Million in Back Taxes ------------------------------------------------------------------ RJR News reports that the Bahamas Department of Inland Revenue claims Sandals Bahamas owes it US$30.8 million in back taxes because it under stated its gross income by US$284 million during the period 2017 to 2022. Sandals has challenged that assessment, according to RJR News. The Department also says it recently exercised its powers of sale to recover US$700 million in tax arrears from the company, leading to the decision to put a number of Sandals properties up for auction on June 24, the report notes. But Sandals says the Department of Inland Revenue has made an error due to inaccurate records and it expects a correction soon, the report adds. =========== B R A Z I L =========== AZUL SA: Establishes Special Independent Committee -------------------------------------------------- investing.com reports that Azul S.A. disclosed the formation of a Special Independent Committee. The announcement was made following the approval by the Company's Board of Directors. The newly formed Committee is composed of three independent directors of the Company: - Mrs. Renata Faber Rocha Ribeiro, - Mr. Jonathan Seth Zinman, and - Mr. James Jason Grant. The Committee is tasked with providing advisory services to the Board, specifically concerning the evaluation, review, planning, oversight of negotiations, and offering recommendations on any matters related to the Chapter 11 proceedings initiated by the Company, the report notes. This move comes as part of Azul's ongoing efforts to navigate the Chapter 11 proceedings, with the aim of restructuring the company's operations and finances, investing.com relays. The establishment of the Committee is intended to ensure that the process is handled with the necessary independence and expertise, the report discloses. Azul, recognized for its punctuality and service, continues to operate a significant number of daily flights to various destinations, maintaining a robust network despite the challenges it faces, the report says. The airline has been acclaimed for its performance, including being named the most on-time airline in the world in 2023 by Cirium and earning the title of the best airline in the world by TripAdvisor (NASDAQ:TRIP) in 2020, the report discloses. The creation of the Special Independent Committee is part of Azul's broader strategy to emerge from Chapter 11 proceedings as a stronger, more competitive airline, the report notes. The announcement is based on a press release statement and reflects the company's commitment to transparency and good governance as it works through this critical phase of its corporate restructuring, the report adds. About Azul SA Azul SA is Brazil's third-largest airline. The company operates a major air transportation network providing scheduled passenger services across Brazil and to international destinations. Founded in 2008, Azul has grown to become one of Brazil's leading carriers with a focus on domestic routes and connecting previously underserved markets throughout the country. Azul SA and affiliates sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 25-11176) on May 28, 2025. In its petition, the Debtor reports $4.5 billion in assets and $9.6 billion in liabilities. The Debtor is represented by Timothy Graulich, Esq. at Davis Polk & Wardwell LLP. The Debtor's Financial Advisor / CRO is Samuel Aguirre at FTI Consulting Inc. and its Claims Agent is Stretto, Inc. AZUL SA: S&P Downgrades ICR to 'D' on Bankruptcy Filing ------------------------------------------------------- S&P Global Ratings lowered its global and national scale issuer credit ratings on Brazil-based airline Azul S.A. to 'D' from 'CCC-' and 'brCCC-', respectively. S&P also lowered its issue-level ratings on the company's 2026 senior unsecured notes to 'D' from 'CC' and withdrew the '6' recovery rating. The downgrade follows Azul's announcement that it filed for Chapter 11 protection on May 28, 2025. Azul S.A. has filed for voluntary bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. This announcement happened after Azul reported considerable cash burn during the first quarter of 2025. Despite sound operational performance, the company still faces a heavy debt burden, while very high lease payments, financial expenses, capital expenditures, and working capital outflows will continue pressuring cash flow. Azul initiated proceedings with creditors' support. Together with the filing, the company announced that it had already secured financial support from key stakeholders including bondholders, its largest lessor (AerCap), and American Airlines and United Airlines. Azul has already secured debtor-in-possession (DIP) financing for almost $1.6 billion to repay some debt and improve liquidity by about $670 million. American Airlines and United Airlines could provide further equity investment upon Azul's emergence. Azul expects to reduce debt by over $2.0 billion during the bankruptcy process. UNIGEL PARTICIPACOES: S&P Affirms 'CCC' ICR on Liquidity Pressures ------------------------------------------------------------------ S&P Global Ratings removed its issuer credit ratings on Brazil-based petrochemical company Unigel Participacoes S.A. from CreditWatch with positive implications (it had placed them on CreditWatch on Feb. 3, 2025). S&P affirmed its global scale issuer credit ratings at 'CCC' and lowered its national scale issuer credit rating to 'brB-' from 'brB+'. The negative outlook reflects S&P's expectation of sustained cash flow pressures and liquidity pressures in the next 12 months, increasing default risk. Continued challenging business conditions, combined with a still heavy capital structure, are again increasing Unigel's liquidity pressures. Unigel concluded its extrajudicial debt restructuring in January of this year, raising about Brazilian real (R$) 460 million in new funding from creditors. Still, weak industry conditions led to high cash burn in the first quarter. The company had adjusted EBITDA of only R$8 million and an operating cash flow deficit of R$186 million, mainly due to substantial working capital outflows and restructuring-related costs. S&P said, "As a result, we see notable liquidity risks when we compare the company's cash position of R$315 million (as of March 31, 2025) with its short-term needs. We estimate interest payments of about R$120 million and maintenance capital expenditures of R$70 million over the next 12 months, on top of its working capital needs. The company also has short-term principal debt maturities of about R$180 million, mainly composed of R$37 million of export credit lines and R$65 million of working capital debt. In our view, the company would depend on favorable business conditions and on being able to refinance its debt maturities in order to remain current on its obligations. "We believe the company's tight liquidity also threatens its ability to finance about $35 million in expansion capex related to the construction of a sulfuric acid plant, which would improve cash generation if completed (because of cost reductions in purchases of raw materials and the potential for additional revenue). We understand that management is searching for new financing for this capex, but the amount, conditions, and timing are still uncertain. "The revamp of Unigel's operations will likely be slower than what was disclosed to the market last year. We do forecast positive EBITDA in 2025 (about R$140 million), mainly driven by Unigel's styrenics operations and significant cost reductions (since the company will return the fertilizer plants to Petrobras). But we think the EBITDA margin will still be weak--below 5%--because of the fixed costs on most of its acrylics plants, which are hibernated (unprofitable at current spreads), and because styrenics spreads remain low amid an oversupply of products and intense competition in the local market." The negative outlook reflects our view that challenging industry conditions will strain the revamp of Unigel's operations as well as its cash flows, increasing liquidity pressures. S&P said, "We could downgrade Unigel if the company can't ease its liquidity and refinancing pressures, which could lead to a higher risk of a default or distressed exchange. "We could take a positive rating action if liquidity pressure eases significantly amid a stronger-than-expected recovery in its cash flows. We could also take a positive rating action if the company receives new cash proceeds that enable it to deal with short-term obligations and finalize the investments in the sulfuric acid plant (accelerating the ramp up of the company's operations)." ============= J A M A I C A ============= ERC MANUFACTURING: Unsecureds to Split $120,000 Over 5 Years ------------------------------------------------------------ ERC Manufacturing Inc. filed with the U.S. Bankruptcy Court for the District of Puerto Rico a Plan of Reorganization for Small Business dated May 5, 2025. The Debtor is air conditioning duct manufacturing corporation fabricating, installing and distributing its work throughout all Puerto Rico. Its principal business location is in Carr. 814, Km 0.8, Credro Abajo, Naranjito, Puerto Rico. ERC owns a commercial property that has been garnished by the IRS, for the amount of $151,381.33. After accruing too much debt, continued payments cannot be paid with actual income. The Debtor seeks to establish a feasible plan, pay all disposable income after reserving a reasonable amount to continue operating and protect its property. All secured claims will be paid according to their corresponding Proof of Claims, less the value of the collateral that guarantees the debt. The remaining unsecured portion of $596,204.87 will be paid under the Unsecured Creditors provisions which will distribute $120,000.00 on prorate or 20.1% of all unsecured debt with in 60 payments of $2,000.00 starting December 1, 2025 when the Debtor pays off various lease agreements. The Debtor will maintain the property in question with a yearly hazard insurance that will be notified to Banco Popular of Puerto Rico and the Small Business Administration, and Lease Option, every year before the expiration of the previous insurance. The Plan Proponent's financial projections show that the Debtor will have projected disposable income of approximately $65,000.00 per month to cover their operation costs and expenses, including $10,000.00 per month to cover for all secured and unsecured portions of all its debt, and assumed lease agreements. This Plan of Reorganization proposes to pay the Debtor's creditors from the net monthly income left from the operation of its business and future earnings. Class 3 consists of Unsecured Claims. All non-priority unsecured debts and undersecured claims will be paid pro-rate from a $120,000.00 pool of the disclosed amounts within the next 5 years for a total of 60 monthly payments of $2,0000.00 beginning December 1, 2025. The Debtor will continue operating its business and will continue administering all the assets of the estate to fund the Plan. The Plan will be funded from the Debtor's post-petition disposable income from the operation of its business. A full-text copy of the Plan of Reorganization dated May 5, 2025 is available at https://urlcurt.com/u?l=I7l7k4 from PacerMonitor.com at no charge. Counsel to the Debtor: Juan Carlos Bigas Valedon, Esq. Juan C Bigas Law Office 515 Ferrocarril Urb. Santa Maria Ponce, PR 00717 Phone: (787) 259-1000 Email: cortequiebra@yahoo.com citas@preguntalegalpr.com About ERC Manufacturing Inc. ERC Manufacturing Inc. owns the property located at Carr 814 Km 0.8 Cedro Abajo, Naranjito, Puerto Rico, spanning 6,977.84 square meters. It includes a two-story commercial office building, two metal concrete industrial buildings, 28 parking spaces, two offices, two terraces, two workshops, two mezzanines, and two bathrooms. The appraised value is $213,000, as of July 27, 2016. ERC Manufacturing Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No. 25-00475) on February 4, 2025. In its petition, the Debtor reports total assets of $785,322 and total liabilities of $1,599,734. The Debtor is represented by Juan C. Bigas, Esq., in Ponce, Puerto Rico. JAMAICA: BOJ Strengthens Liquidity Requirements for Banks --------------------------------------------------------- David Rose at Jamaica Observer reports that the Bank of Jamaica (BOJ) is set to make an amendment to liquidity guidelines governing banks in order to better protect customers and ensure that they can access their funds without delay. This was confirmed by BOJ Deputy Governor Dr Jide Lewis at the central bank's quarterly monetary press conference, according to Jamaica Observer. The amendment relates to the BOJ's standard of sound practice on the liquidity coverage ratio (LCR) which currently sits at 100 per cent with the BOJ pushing to add an additional 20 per cent buffer, the report notes. "So, this amendment is about strengthening the banking sector's ability to meet the obligations of their license as deposit takers. It's a major source of funding for the banks, but they also have an obligation to make sure that the amount the public comes to them for at an instant, they're in a position to meet that need," Lewis said in response to the query, the report relays. The LCR is a calculation reported by deposit-taking institutions (DTIs) to the BOJ on a monthly basis, the report discloses. It requires DTIs to hold high-quality liquid assets (HQLAs) that exceed their net cash outflows over a 30-day stress period, the report says. If a bank had $1 billion in net cash outflows in a 30-day period, the bank must have $1 billion in HQLAs to pay depositors, the report relays. The proposed change by the BOJ would require a bank to hold $1.2 billion in HQLAs to meet the demands of depositors under that 30-day stress period, the report notes. HQLA's is categorised into two categories such as level 1 and level 2. Level 1 HQLAs include cash, central bank reserves, certain financial instruments issued by the Government of Jamaica (GOJ) and qualifying marketable securities from central banks and multilateral development banks, the report relays. Level 2 HQLAs covers other qualified forms of debt and equity, the report discloses. The full value of Level 1 HQLA's can be accounted for in the HQLA calculation while level 2 HQLAs have haircuts applied in the overall HQLA calculation, the report relays. The standard of sound practice document also noted that the BOJ began consultations in March 2025 on the inclusion of a HQLA framework, the report says. The document also noted that if a bank falls below the 115 per cent LCR point, the BOJ can implement limits on the discretionary payments like dividends, share buybacks, and bonuses for senior management and executives of banks, the report notes. "Essentially, that additional 20 per cent would mean that they are proactively managing their liquidity needs in the future because if it falls to 115 [per cent], they will begin to hear from us at the Central Bank. We will write to them, they will tell us what their plans are to bring it back up to 120 [per cent] and if it falls to 110 [per cent], then they will begin to hear from us in terms of required actions and possible remedial steps and they would enter our ladder of enforcement," Lewis added on the change, the report discloses. The LCR ratio was introduced by the Basel Committee of the Bank for International Settlements (BIS) after the global financial crisis in 2008 and was meant as a way to address liquidity risk management and systemic risks from inadequate buffers by financial institutions, the report relays. The BOJ implemented the full LCR requirement in November 2019 with a minimum of 75 per cent and increased it to 100 per cent in November 2020, the report notes. Dr Lewis also noted that this change shouldn't have a functional impact on the ability of DTIs since the LCR average is 130 — 140 per cent with some DTI's having a LCR as high as 160 per cent, the report discloses. Although this proposed move will strengthen the protection of banking customers, some banks have concerns on the numerous changes being pushed in recent times, the report relays. DTIs are currently reporting to the BOJ under the Basel II and Basel III standards with the Basel III implementation timeline still in the wind, the report notes. This is due to the numerous legislative requirements that must be brought into law to enact these proposed capital changes, the report discloses. Basel III will see changes to the bank's capital requirements and the introduction of the capital conservation buffer (CCB) and countercyclical capital buffer (CCYB) to strengthen the financial system, the report relays. The BOJ provided responses to DTIs on their queries regarding the introduction of the CCB. When certain legislative requirements take place, the BOJ noted that there would be a one-year phase in arrangement and a the CCB would be adjusted by 0.5 per cent each year until it hits 2.5 per cent, the report notes. "However, note that the Bank has calibrated the CCB whilst considering conglomeration and interconnectedness in the Jamaican financial system. In the context of ever evolving risks and since the minimum capital requirements represent a floor on the capital levels that an institution should maintain during normal times, institutions should embrace risk-centric approaches by maintaining additional buffers above the capital adequacy ratio ("CAR") to absorb losses while continuing to conduct business as normal," stated the BOJ's response to DTIs on the CCB, the report says. Also, the BOJ is planning to introduce the special resolution regime (SRR) which was brought to the Jamaican Senate last June under the name Financial Institutions (Resolution and Winding up) Act, the report relays. This item seeks to provide a mechanism to orderly address any failing financial institution. Apart from this bill seeking to create this orderly scheme of resolution, the bill also seeks to create a fund estimated to be at least $40.1 billion or 1.5 per cent of GDP which would be funded by the financial sector, the report notes. "The SRR, when fully implemented, will improve legal certainty and transparency regarding the procedures that would unfold in the event of a financial institution's failure or impending failure. Furthermore, the anticipated increase in market discipline is expected to reinforce the stability of the financial system and bolster investor confidence,"stated the BOJ's 2024 financial stability report, Jamaica Observer relays. All of these capital changes along with the asset tax plus increased cost to address fraud and security might be impediments to future reductions of interest rates, the report notes. The BOJ increased the cash reserve/statutory reserve requirement to 6.0 per cent for Jamaican-dollar liabilities and 14.0 per cent for foreign currency liabilities in February 2023. These reserves don't pay interest to the DTI's which hold these reserves at the central bank, the report discloses. The BOJ reduced its policy rate on May 21 to 5.75 per cent, a 1.75 per cent cut since its recent peak of 7.0 per cent, the report relays. However, BOJ Governor Richard Byles made another plea for the DTIs to start reducing interest rates, the report adds. About Jamaica Jamaica is an island country situated in the Caribbean Sea. Jamaica is an upper-middle income country with an economy heavily dependent on tourism. Other major sectors of the Jamaican economy include agriculture, mining, manufacturing, petroleum refining, financial and insurance services. On Feb. 21, 2025, Fitch Ratings affirmed Jamaica's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-', with a positive rating outlook. In October 2023, Moody's upgraded the Government of Jamaica's long-term issuer and senior unsecured ratings to B1 from B2, and senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has been changed to positive from stable. In September 2024, S&P affirmed 'BB-/B' longterm foreign and local currency sovereign credit ratings on Jamaica and revised outlook to positive. ===================== P U E R T O R I C O ===================== PUERTO RICO: New Fortress Energy Barred From Power Auction ---------------------------------------------------------- Ruth Liao and Jim Wyss of Bloomberg News report that New Fortress Energy has been excluded from a Puerto Rican government auction to provide temporary power generation, representing another blow to billionaire Wes Edens' struggling company. In a letter to the governor's office, the liquefied natural gas and logistics firm asked to be reconsidered for the 800-megawatt contract, which is intended to stabilize the U.S. territory's fragile power grid. The company claimed it could offer the most affordable electricity, using clean fuel with quick deployment capabilities, and emphasized its existing turbine operations on the island. About Puerto Rico Puerto Rico is a self-governing commonwealth in association with the United States. The chief of state is the President of the United States of America. The head of government is an elected Governor. There are two legislative chambers: the House of Representatives, 51 seats, and the Senate, 27 seats. The governor-elect is Ricardo Antonio "Ricky" Rossello Nevares, the son of former governor Pedro Rossello. In 2016, the U.S. Congress passed PROMESA, which, among other things, created the Financial Oversight and Management Board and imposed an automatic stay on creditor lawsuits against the government, which expired May 1, 2017. The members of the oversight board are: (i) Andrew G. Biggs, (ii) Jose B. Carrion III, (iii) Carlos M. Garcia, (iv) Arthur J. Gonzalez, (v) Jose R. Gonzalez, (vi) Ana. J. Matosantos, and (vii) David A. Skeel Jr. On May 3, 2017, the Commonwealth of Puerto Rico filed a petition for relief under Title III of the Puerto Rico Oversight, Management, and Economic Stability Act ("PROMESA"). The case is pending in the United States District Court for the District of Puerto Rico under case number 17-cv-01578. A copy of Puerto Rico's PROMESA petition is available at http://bankrupt.com/misc/1701578-00001.pdf On May 5, 2017, the Puerto Rico Sales Tax Financing Corporation (COFINA) commenced a case under Title III of PROMESA (D.P.R. Case No. 17-01599). Joint administration has been sought for the Title III cases. On May 21, 2017, two more agencies -- Employees Retirement System of the Government of the Commonwealth of Puerto Rico and Puerto Rico Highways and Transportation Authority (Case Nos. 17-01685 and 17-01686) -- commenced Title III cases. U.S. Chief Justice John Roberts named U.S. District Judge Laura Taylor Swain to preside over the Title III cases. The Oversight Board has hired as advisors, Proskauer Rose LLP and O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic consultant, Citigroup Global Markets as municipal investment banker, and Ernst & Young, as financial advisor. Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M. Abelson, Esq., of Proskauer Rose LLP; and Hermann D. Bauer, Esq., at O'Neill & Borges LLC are onboard as attorneys. Prime Clerk LLC is the claims and noticing agent. Prime Clerk maintains the case Web site https://cases.primeclerk.com/puertorico Jones Day is serving as counsel to certain ERS bondholders. Paul Weiss is counsel to the Ad Hoc Group of Puerto Rico General Obligation Bondholders. ===================================== T R I N I D A D A N D T O B A G O ===================================== UTC: Net Profit Drops 67% to $19 Million for 2024 ------------------------------------------------- Trinidad Express reports that the Trinidad and Tobago Unit Trust Corporation reported a 67% drop in net profit for 2024, falling from $57 million in 2023 to $19 million last year. However, executive director Nigel Edwards said that the drop was no cause for concern, stating it was a "deliberate choice" to increase distributions to investors, according to Trinidad Express. Edwards said distributions to unitholders totalled nearly $495 million last year, representing a 60.3% increase over 2023, the report notes. And chairman Jo-Anne Julien also stated that the lower profit was not indicative of any operational weakness at UTC, but rather the result of broader market conditions and strategic policy decisions, the report relays. Julien and Edwards made the comment as the UTC held its 43rd annual general meeting at the National Academy for Performing Arts, Port of Spain. "As noted by our chairman, UTC recorded a 67% fall in net income for fiscal 2024 compared to 2023. However, it is important to emphasise that this is not a reflection of diminished value for our unitholders. In fact, we made a deliberate choice to increase distributions to you, our investors, by over 60% compared to 2023; a decision rooted in our mission to prioritise unitholder value. Unlike privately held institutions, UTC was established to serve the interests of its unitholders, not to maximise profits," Edwards said, the report discloses. "This fall in income stems primarily from an increased provision for the Growth and Income Fund's price guarantee, which is a commitment that ensures that unitholders who remain invested for three years are protected at their entry price. This historical commitment, which was put in place since 1985, is a guarantee that we have upheld for 40 years, even in challenging market conditions," he added. In her address, Julien noted that despite "facing headwinds" last year, the UTC remained steady, the report relays. "In 2024, the global and regional economic landscapes were influenced by persistent inflation, geopolitical volatility, and structural changes, resulting from the post-pandemic recovery. These headwinds have tested even the most resilient institutions, including those right here, in Trinidad and Tobago. Yet still, UTC has remained steady, focused on its founding mission to expand access to investment opportunities for all, empowering individuals to build long-term financial security," Julien stated, the report notes. "UTC continues to offer stability in uncertain times. Our progress is guided by effective stewardship and accountability. We are managing your investments with a shrewd sense of responsibility and discipline," she said. Julien said that as the UTC pivots its operational systems to meet the demands of an evolving financial landscape, it is important to underscore sustainability in its business model, the report relays. "Looking at our financial performance, it is also important to address the fall in net income for fiscal 2024 compared to 2023. This result does not reflect operational weakness but rather the impact of broader market conditions and strategic policy decisions," Julien stated, the report discloses. 'Mandated to Serve' "Aligned with our mission, to bring long-term value creation for unitholders, UTC significantly increased distributions to unitholders, returning capital to those we are mandated to serve, even amid challenging market conditions," she said. Edwards said that in a year marked by global uncertainties and cautious investor sentiment, the UTC demonstrated "resilience and strategic foresight," she replied, the report discloses. "We generated $1.045 billion in total investment income, underpinned by disciplined asset allocation and strategic diversification," Edwards said, the report notes. Edwards said the TT Dollar Income Fund distributed $279.4 million last year, an increase of 78.2% compared to 2023, while the US Dollar Income Fund distributed $129.5 million, up 89.2% over the previous year, the report relays. Edwards also lauded the Calypso Macro Index Fund, which he said is the first of its kind in Trinidad and Tobago, offering investors unique exposure to a diversified portfolio, the report discloses. "As of year-end 2024, the Calypso Macro Index Fund managed assets totalling $569.42 million. Notably, it is set to mature this year, marking a significant milestone for both the Fund and the Corporation as we deliver on our promise to return value to unitholders," Edwards said, the report notes. Edwards said digital transformation is a "critical part" of the UTC's strategy to maintain its competitive edge, the report says. "We are moving beyond traditional methods of managing investments, making it easier and more convenient for unitholders to engage with us online. Our digital platform, Uon, empowers you to track and grow your investments from anywhere, without the need to visit an Investment Centre,' Edwards stated. "Additionally, our TTUTC mobile app, which was developed by programmers in Trinidad and Tobago, is designed to simplify investment management, providing greater flexibility and control in the palm of your hands. Even more enhancements are on the way, which we'll be sharing with you shortly," he stated, the report notes. Edwards said UTC is focused on securing a future for those to come. "We are, therefore, building sustainability principles into all aspects of our strategy and operations to ensure that your wealth creation can be passed from generation to generation. Sustainability is a catalyst for performance. In addition, by integrating AI and other technologies, we aim to enhance efficiency, security, and inclusivity, aligning with the values of our investors," he added. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Latin America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2025. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. 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