250619.mbx

250619.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 Thursday, June 19, 2025, Vol. 26, No. 122 Headlines A R G E N T I N A ARGENTINA: Monthly Inflation Rate Drops to 1.5% in May GAUCHO GROUP: Emerges from Ch. 11, Eyes Argentina Growth B R A Z I L FS LUXEMBOURG: Moody's Rates New $500MM Unsecured Notes 'Ba3' NEW FORTRESS: Fitch Lowers LongTerm IDR to 'CCC' E C U A D O R ECUADOR: Moody's Affirms 'Caa3' Foreign Currency Issuer Rating G U A T E M A L A CENTRAL AMERICA BOTTLING: Fitch Affirms 'BB' LongTerm IDRs P E R U BANCO INTERAMERICANO: Fitch Affirms 'BB+' IDRs, Outlook Stable P U E R T O R I C O DELTA X1: Seeks to Hire Juan C. Bigas Valedon as Legal Counsel NEOLPHARMA INC: Seeks to Extend Plan Exclusivity to July 1 T R I N I D A D A N D T O B A G O TRINIDAD & TOBAGO: Energy Consumption Culture Unsustainable TRINIDAD & TOBAGO: Rising Import Costs Outpace Export Earnings X X X X X X X X LATAM: New Brazil-Caribbean Deal Aim to Revitalize Commerce - - - - - ================= A R G E N T I N A ================= ARGENTINA: Monthly Inflation Rate Drops to 1.5% in May ------------------------------------------------------ AFP News reports that monthly inflation in Argentina dropped below two percent for the first time in almost five years in May, the INDEC national statistics bureau reported. Consumer prices rose just 1.5 percent last month, according to INDEC, slowing from the 2.8 percent in April and 3.7 percent recorded in March. It's the lowest monthly tally since May 2020 and the first time since July 2020 that it passed below two percent, according to AFP News. The news is a boost for President Javier Milei, Argentina's self-declared "anarcho-capitalist" head of state who came to power in December 2023 wielding a chainsaw as a symbol of his plan to restore fiscal discipline and curb runaway prices, the report notes. In the La Libertad Avanza leader's first month in office, consumer prices soared by more than 25 percent, the report relays. According to INDEC, inflation so far this year totals 13.3 percent, the report notes. Prices over the last 12 months have increased 43.5 percent – well below the 211 percent annual rate recorded at the end of 2023 when Milei was inaugurated, the report discloses. The largest increases for the month were seen in the restaurants and hotels category (up three percent), communications (up 4.1 percent, mainly due to telephone and Internet services) and housing, water and electricity (up 3.1 percent), the report says. The two divisions that recorded the lowest variations were food and non-alcoholic beverages (0.5 percent) and transport (0.4 percent), the report relays. Core inflation stood at 2.2 percent last month, with seasonal prices decreasing 2.7 percent and regulated costs rising 1.3 percent, the report notes. The 1.5-percent rate was the lowest since May 2020. Excluding the specific impact on the consumer price index in the early months of the pandemic, monthly inflation was the lowest since November 2017, the report recalls. Private consultancy firms had forecast a rate of around two percent or lower. The most recent Central Bank survey of market expectations forecasts annual inflation of 28.6 percent in 2025, the report relays. Last year, Argentina recorded its first budget surplus in a decade, but the collateral damage was a loss of purchasing power, jobs, and consumer spending, the report relays. In April, Argentina received an initial US$12 billion from a new US$20-billion loan agreed by the International Monetary Fund (IMF) to support a "comprehensive economic program," the report discloses. When the loan deal was announced, the IMF said it was built on "the authorities' impressive early progress in stabilising the economy, underpinned by a strong fiscal anchor, that is delivering rapid disinflation and a recovery in activity and social indicators," the report relays. Success in curbing prices is the result of an austerity programme that entailed firing tens of thousands of public sector workers, halving the number of government ministries and vetoing inflation-aligned pension increases, the report notes. The report discloses that Milei's government celebrated INDEC's update, which it attributed to the economic team's "successful orthodox stabilisation plan." We "carried out a historic 15-point adjustment of the (Gross Domestic Product) GDP, ended money-printing and eliminated the cepo," Presidential Spokesperson Manuel Adorni wrote on his WhatsApp channel to journalists, referring to strict exchange controls that had been in place since 2019 and were partially eliminated this year, the report relays. The positive numbers will do little to quell the anger of Argentines over their loss in purchasing power, with wages having remained stagnant over many months of high inflation, the report notes. Cristian Rodriguez, a 45-year-old logistics employee, said the rising cost of living is outpacing wage hikes, affecting his family's standard of living, the report relays. "Prices are not dropping; they are rising," said Rodríguez. "Everything edible is going up," he added. "Just as inflation has reportedly dropped, salaries have also been paralysed. We haven't had a raise for a year," he explained. 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. GAUCHO GROUP: Emerges from Ch. 11, Eyes Argentina Growth -------------------------------------------------------- Gaucho Group Holdings, Inc., a company that includes a growing collection of ecommerce platforms with a concentration on fine wines, luxury real estate, and leather goods and accessories, announced on June 16, 2025, that it has successfully emerged from Chapter 11 bankruptcy proceedings. With this significant milestone behind it, the Company has returned its full focus to executing its portfolio strategy in Argentina -- returning to operations unencumbered and with its core assets intact. Argentina's macroeconomic landscape is exhibiting notable improvement, creating a more conducive environment for long-term investment. Inflation has fallen to its lowest monthly level in over five years, and broader economic stabilization measures are gaining traction. Over the past several months, Argentines have begun to access long-term mortgage financing once again, which is freeing them from cash-only home purchases. That shift is unlocking renewed demand for housing, stimulating development across the country, and generating jobs not only in construction, but also in the materials, home-goods retail, and financial services sectors. Additionally, a healthier mortgage system supports capital formation, as banks and investors now have access to stable mortgage revenues, helping to mature Argentina's financial markets and reduce reliance on cyclical, short-term funding. This economic runway has been further bolstered by strengthened defense cooperation with the United States. In a marked shift from past alignments, Argentina has deepened its military coordination with U.S. leadership. Meetings between Argentina's President and U.S. defense officials, alongside joint maritime exercises in Argentine waters, reflect a clear realignment of strategic partnerships. These developments underscore Argentina's departure from closer ties with former allies and signal its intent to embrace renewed alignment with Western institutions. "Emerging from Chapter 11 positions Gaucho Holdings to re-engage fully in Argentina," states Scott Mathis, CEO and Founder of Gaucho Holdings. "With inflation at its lowest level in years, access to mortgage finance restored, and clear signals of institutional realignment - especially through enhanced U.S. military and economic ties - we are seeing the environment we've long anticipated. Our deepest gratitude to our legal team, stockholders, and every employee whose dedication and resilience made this possible. This marks the start of an exciting new chapter. Our existing assets are well--placed to participate in this evolving landscape, and we are energized to move forward together." Maria Echevarria, Chief Financial Officer of Gaucho Holdings, commented: "After seven transformative months, we're proud to announce that we have emerged from Chapter 11. This was a challenging journey, and while the decision to restructure was difficult, it was necessary - and it worked. Thanks to the extraordinary support, dedication, and resilience of our legal team, stockholders, and every employee. We've safeguarded the Company's assets and laid the groundwork for a stronger, more focused future. This moment marks the beginning of a new chapter. We move forward with renewed clarity, purpose, and confidence in what we're building together." The Company notes that, while the economic and structural reforms in Argentina are advancing, the foreign investment opportunity window remains in its early stages. Gaucho Holdings, having preserved its asset base and local infrastructure, believes it is positioned ahead of the curve to engage strategically with the country's renewed momentum. About Gaucho Group Holdings, Inc. Gaucho Group Holdings, Inc. is a Delaware holding company headquartered in Miami, Fla., which owns certain subsidiaries including operating companies that own a winery, boutique hotel and real property in Argentina. Gaucho filed Chapter 11 petition (Bankr. S.D. Fla. Case No. 24-21852) on November 12, 2024, with $10 million to $50 million in both assets and liabilities. Nathan G. Mancuso, Esq., at Mancuso Law, P.A. is the Debtor's legal counsel. =========== B R A Z I L =========== FS LUXEMBOURG: Moody's Rates New $500MM Unsecured Notes 'Ba3' ------------------------------------------------------------- Moody's Ratings assigned a Ba3 rating to the proposed up to $500 million backed senior unsecured notes to be issued by FS Luxembourg S.a r.l. and unconditionally and irrevocably guaranteed by FS Industria de Biocombustiveis Ltda (FS, Ba3 stable) and FS I Industria de Etanol S.A. The company's existing ratings are unchanged. The outlook remains stable. FS' proposed issuance is aimed mainly at liability management, including the partial tender offer of FS notes due 2031, and will not result in a material increase in the company's leverage. The rating of the proposed notes assumes that the final transaction documents will not be materially different from draft legal documentation reviewed by us to date and assume that these agreements are legally valid, binding, and enforceable. RATINGS RATIONALE FS ratings are supported by the company's adequate liquidity and business model, which will allow the company to maintain adequate credits metrics, benefiting from its increased crushing capacity, sustained demand for ethanol and abundant availability of corn as feedstock. In 2024-2025, Moody's-adjusted EBITDA reached BRL2.8 billion, up from BRL1.2 billion in 2023-2024, favored by higher ethanol prices and a sharp decline in corn costs to BRL44/bag from BRL56/bag in the previous harvest. This EBITDA generation drove gross leverage to 3.6x times by harvest end, March 2025, compared to 5.6x in the last twelve months ended December 2024, in-line with Moody's expectations of 3.5x – 4.0x gross leverage. Despite volatile spreads, Moody's expects FS to maintain adequate credit metrics for the Ba3 rating level. While leverage could increase during periods of weak spreads, Moody's expects the company to generate positive free cash flow even during adverse market conditions. The proposed bond issuance will allow FS to lengthen its debt schedule, further alleviating refinancing needs in the next two harvests. FS rating incorporates the company's adequate leverage and liquidity, and large scale among ethanol producers in Brazil (the company is one of the largest producers that use corn as feedstock). FS is a low-cost producer with favorable access to corn feedstock and is located in a region with high demand for animal feed, a co-product of the ethanol production process. The company has a low carbon footprint, benefiting from the sustained growth in demand for biofuels. Additionally, the company has a strong track record of growing organically. FS' rating is constrained by its high exposure to the dynamics of the ethanol and corn markets; and the consequent susceptibility to sharp price volatility, event risks, weather imbalances and global trade flow, which can cause momentary leverage spikes. The exposure to corn prices is partially offset by its animal nutrition business, given that the price of dried distillers grains is directly correlated to that of corn and soybean meal. Few mills and concentration in a single commodity in a single region exacerbate FS' commodity risks. Liquidity is adequate with BRL2.5 billion in cash and BRL0.95 billion in short-term debt, mainly working capital lines. Moody's believes FS will maintain an active liability management to avoid a concentration of maturities in the short-term. RATING OUTLOOK The stable rating outlook incorporates Moody's expectations that FS will maintain sustained EBITDA generation with gross leverage below 4.0x, even as it advances in increasing capacity. The outlook also incorporates prudent shareholder distributions, which should not jeopardize liquidity and leverage. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING FS' ratings are constrained by the concentration and single-line commodity exposure of its business (corn ethanol and related co-products). An upgrade would require further business diversification that reduces geographic and commodity risk exposure, coupled with a robust financial position, consistent positive free cash flow, low leverage and adequate liquidity. Quantitatively, an upgrade would require the following: Debt/EBITDA below 3.0x; Retained cash flow (RCF)/debt above 20%; EBITDA/interest expense above 5.0x; all on a sustained basis. A downgrade could result from a consistent increase in leverage or a deterioration in liquidity. Large shareholder distributions or the deployment of large investments that compromise short-term credit metrics and liquidity could trigger a downgrade. Quantitatively, a downgrade would require the following: Debt/EBITDA above 4.0x; RCF/debt below 10%; EBITDA/interest expense below 2.5x; all on a sustained basis. FS is headquartered in Lucas do Rio Verde, Mato Grosso, Brazil. The company produces ethanol from corn feedstock. It also commercializes the co-products generated in the production process, including dried distillers grains, wetcake, corn oil for livestock feed, and electricity and steam. FS is a limited liability company controlled by US-based Summit Agricultural Group (Summit) (with a 70.7% stake), and other shareholders (including Marino J. Ferraz, Amerra Chapada LLC, Miguel V. Ribeiro, and Paulo S. Franz). In the 2023-24 harvest, FS generated net revenue of BRL8.0 billion ($1.64 billion, converted using the average rate for the period), with a Moody's-adjusted EBITDA margin of 14.7%. The principal methodology used in this rating was Chemicals published in October 2023. NEW FORTRESS: Fitch Lowers LongTerm IDR to 'CCC' ------------------------------------------------ Fitch Ratings has downgraded New Fortress Energy Inc.'s (NFE) Long-Term Issuer Default Rating (IDR) to 'CCC' from 'B-'. The rating has been removed from Rating Watch Negative (RWN). Fitch has also downgraded NFE's $2.7 billion 12% senior secured notes due 2029 issued by NFE Financing LLC and term loan B to 'CCC' with a Recovery Rating of 'RR4' from 'B-'/'RR4'. In addition, Fitch has downgraded both the 6.50% senior secured notes due September 2026 and the 8.75% senior secured notes due March 2029 to 'CCC-'/'RR5' from 'CCC+'/'RR5'. The downgrade reflects Fitch's view that NFE has elevated execution risk in achieving a 2025 EBITDA figure which would be supportive, along with other liquidity resources, of refinancing debt maturing in 2026 and 2027. The downgrade also reflects a concern regarding the delay in filing of the 10-Q. Key Rating Drivers Refinancing and Liquidity Risk: High-interest expenses, averaging around $900 million in each of the next three years, constrain financial flexibility. Fitch calculates EBITDA interest coverage as below 1.0x over the next three years. NFE stated it was able to retain around $400 million in cash from the Jamaica asset sale which Fitch views favorably. Pursuant to an amendment to the credit facility entered into as a consequence of the asset sale, covenants limit the amount of cash the company can use to repurchase the 2026 notes, other than payments to avoid springing maturities. If the approximately $500 million 6.5% senior secured notes due September 2026 are not paid by July 31, 2026, 60 days before their maturity, it would trigger around $2.2 billion of additional springing maturities. Under Fitch's rating case, there would be a cash shortfall in 2026, partly due to high costs of the recent financings. Fitch's assumptions are more conservative than management's, embedding considerably lower cash flows in Puerto Rico and slower development in Brazil, though Fitch believes some capex can deferred, particularly payments for the FLNG2 construction. Elevated Execution Risk: NFE's recent results have been weaker than Fitch's previous expectations. The company's 1Q2025 EBITDA was over 20% lower than Fitch's estimates for the quarter. Given first an amendment to a Puerto Rico contract regarding a re-contracting window, and, subsequently, given NFE being left off the short list for the temporary power auction, there is greater uncertainty now than previously that the company will achieve its 2025 projections. The lack of a 10-Q for the period ending March 31, 2025 also adds to the uncertainty in Fitch's estimation. These developments follow weaker than expected YE2024 results under Fitch's calculations, which removes excess gas sales. Two primary assets in Brazil, CELBA2 and the Portocem power plants, are still under construction. Under Fitch's assumptions Brazil accounts for around 30% of NFE's EBITDA in 2025-2027 and FCF is negative over the next three years. Start-up risk associated with smaller projects remains.. Recontracting Challenges in Puerto Rico: An inability to secure constructive contracts in Puerto Rico is a key risk for NFE. Puerto Rico is NFE's largest market, expected to contribute over 50% of total EBITDA in the forecast period under Fitch's forecast. The island-wide gas supply contract in Puerto Rico will come due in June 2025. While NFE benefits as an incumbent operator in the power gas supply sector, Fitch estimates the company is in a weaker position to win a substantial bid, given it was not selected for the short list in the the temporary power auction. Untenable Capital Structure: Under its updated assumptions, Fitch expects NFE's leverage will be above 10.0x in 2025-2027. Leverage remains high pro forma for the Jamaica asset sale due to debt-funded capex for the development of the FLNG2 liquefaction unit and completion of the projects in Brazil. Absent further asset sales, any significant deleveraging would require favorable contracts in Puerto Rico. Fitch views receipt of FEMA proceeds, which could be a significant source of cash, as increasingly uncertain at this time. In Fitch's view, weaker cash flow expectations along with the above factors leaves a shorter runway for NFE to right-size its capital structure. Counterparty and Country Ceiling Exposure: NFE's IDR is not capped by a country ceiling at its current rating level. Fitch estimates that through 2027, a majority of NFE's cash flows will originate in Puerto Rico (N/R; no transfer and convertibility cap) and Brazil (BB/Stable), with the remaining expected to be derived in Mexico (BBB-/Stable) and Nicaragua (B/Stable). The counterparty credit profile is weak with over two-thirds of the revenues derived from customers that are not rated or rated below the BB category. ESG - Financial Reporting: Fitch believes NFE's delay in reporting timelines and governance structure including ownership concentration have a negative impact on the credit profile. The 1Q25 10-Q has been delayed beyond the allowable filing period and the company is not in compliance with NASDAQ requirements. Fitch believes these practices could impact NFE's ability to access future funding. Peer Analysis NFE is closest in operations and geographical focus to LNG producer Venture Global LNG, Inc. (VGLNG; B+/Stable). NFE's cash flows are supported by the sale of LNG and power to utilities, power generators and industrial customers. VGLNG's operations are more specialized as an LNG producer. Fitch views NFE's operations in Latin America and South America as having greater operating risk compared to VGLNG's somewhat more proven natural gas liquefaction operations. Both entities have considerable exposure to commodity prices, though VGLNG's projects are anchored by long-term contracts to largely creditworthy customers. NFE's contracts are shorter in term, have a lower portion of take-or-pay features and their counterparty credit quality is lower. VGLNG faces greater construction and development risk with three large projects in various stages of completion compared to the FLNG2 unit as the largest near-term project under construction, though Fitch expects the company to develop additional infrastructure, especially in Brazil. Fitch views the liquidity at NFE to be constrained despite the recent refinancing and asset sale. The majority of NFE's subsidiaries are encumbered but the company has limited asset level debt at its terminals. VGLNG's two operating projects have substantial leverage, which could limit cash flows at the parent if merchant prices were weaker. NFE's leverage under the Fitch rating case is expected to be weak in 2025-2027, averaging over 10.0x compared to around 6.0x for VGLNG over the same period. NFE's weaker operating profile, higher leverage, lower interest coverage, and constrained liquidity account for its lower ratings. Key Assumptions - LNG market spreads informed by Fitch's price deck: $5.00/mcf in 2026 and $4.25/mcf in 2027; - Natural gas at Henry Hub (HH) as per Fitch's price deck: $3.00/mcf in 2026 and $2.75/mcf in 2027; - Net proceeds from the sale of the Jamaican assets applied as stated by management; - Significantly lower cash flows from Puerto Rico, given NFE was left-off the recent emergency power auction; - In Brazil, Fitch conservatively assumes the CELBA2 project will be completed by end of 2025 and Portocem by end of 2026; - Construction for FLNG2 completed per Fitch's current budget estimate; - Timing and quantum of cash flows in Mexico and Nicaragua in line with company's estimates; - Proceeds of approximately $400 million (total) from the FEMA claim received partially in 2025 and partially in 2026; - No dividends; - Interest expense reflecting a base rate as per Fitch's "Global Economic Outlook" for 2025 and kept constant thereafter; - Additional growth capital spending largely funded with retained cash and debt. Recovery Analysis For Recovery Ratings, Fitch assumes default could occur during construction of the Brazilian power plants and the FLNG2 asset, and the reorganization would be impacted by the diverse locations of the terminals. Fitch estimates the company's liquidation value is greater than its going concern value. The assets are in different jurisdictions and are functionally diverse as well. In a bankruptcy scenario, it is more likely that the assets would be sold to various parties with the requisite expertise. In addition, each asset is pledged as collateral across different debt classes. For all these reasons Fitch is using a liquidation value approach instead of the going concern approach. Terminal assets were valued based on haircuts to third-party valuations provided by the company. FLNG assets were valued based on their production capability (1.4 mtpa), the cost of building similar assets and the percentage of completion. The estimated liquidation value was around $3.6 billion, pro forma for the sale of the Jamaica assets. The liquidation value was about 20% higher than the going concern value, calculated with a 5.0x EBITDA multiple. There have been limited bankruptcies in the midstream sector. Two recent gathering and processing bankruptcies indicate an EBITDA multiple between 5.0x and 7.0x, as per Fitch estimates. Fitch's October 2024 bankruptcy case study report, "Energy, Power and Commodities Bankruptcy Enterprise Values and Creditor Recoveries," found a median enterprise valuation exit multiple of 5.3x across 51 energy cases (sufficient data to estimate was 5.3x), with a wide range observed. Fitch calculated administrative claims to be 10%, which is the standard assumption. The outcome is a 'CCC'/'RR4' rating for term loan B and the new 12% notes maturing in 2029. The legacy 6.5% notes maturing in September 2026 and 8.75% notes maturing in March 2029 have lower collateral coverage and receive a 'CCC-'/'RR5' rating, after applying the country-specific considerations. On a normalized run-rate basis, Fitch believes almost all the revenues will come from outside the U.S., from countries where Fitch does not assign an uplift to the debt based on the recovery profile. Per Fitch's "Corporates Recovery Ratings and Instrument Ratings Criteria," secured debt can be notched up to 'RR1'/'+3' from the IDR; however, the instrument ratings have been capped at 'RR4' due to Fitch's "Country-Specific Treatment of Recovery Rating Criteria." RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Failure to proactively address the 2026 maturity and revolver payments; - A debt restructuring that is considered as a distressed debt exchange; - Unfavorable result in the Puerto Rico contract negotiations or weak execution on new projects, such as a delay in completion of CELBA2 beyond 2025 or Portocem power plant beyond 2026, or cost overruns at FLNG2; - An inability to maintain sufficient cash levels to operate over the next 12 months; - Liability management activities that diminish recovery prospects for existing noteholders; - Negative FCF generation on a sustained basis. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Expectation of EBITDA interest coverage above 1.2x and Fitch calculated EBITDA leverage below 7.0x on a sustained basis; - Constraints to liquidity removed from 2026 onward; - Successful re-contracting efforts in key markets and timely completion of ongoing construction projects within budget. Liquidity and Debt Structure According to NFE's 8-K dated May 21, 2025, NFE held about $1.1 billion in cash and cash equivalents including around $400 million retained from the proceeds of the Jamaica asset sale, and $379.5 million in restricted cash. The allocation of sales proceeds was done pursuant to an amendment to the term loan A credit agreement (among others), paying off $270 million on the revolver borrowing due in 2025 and $55 million of the term loan A from proceeds of the sale. Per the 8-K, the $730 million revolving credit facility was fully drawn, with $100 million maturing in April 2026 and the remaining $630 million due in October 2027. The revolving credit facility, along with term loan B ($1.3 billion) and term loan A ($295 million), must be fully repaid 60 days before the maturity of the 2026 notes if those notes are outstanding as of that time. The 2026 senior notes (September maturity) notes have an outstanding balance of approximately $500 million. Issuer Profile New Fortress Energy LLC is a gas-to-power energy infrastructure company that spans the production and delivery chain from natural gas procurement and LNG production to logistics, shipping, terminals and conversion or development of natural gas-fired generation. Summary of Financial Adjustments Consolidated leverage for NFE includes asset level debt and the Energos Formation Transaction obligations. Under Fitch's "Corporate Criteria," the Energos lease obligations are considered long-term obligations, and the reported lease liability is treated as debt. Fitch uses cash interest paid in its calculation for EBITDA interest coverage. Capitalized interest is added back as cash. The preferred stock at GMLP is given a 50% equity credit due to its perpetuality and cumulative nature of the dividends and interest. NFE's recently issued series A convertible preferred stock is treated as 100% debt as its dividend rate increases by 2% until the company pays of all previously accrued but unpaid dividends. Fitch's EBITDA is calculated by removing non-recurring items such as contract novations and asset sales. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations New Fortress Energy Inc. has an ESG Relevance Score of '5' for Financial Transparency due to the delay in filing its 10-Q and the level of detail and transparency in its financial disclosure that is weaker than other industry peers, which has a negative impact on the credit profile and is highly relevant to the rating, resulting in an implicitly lower rating. New Fortress Energy Inc. has an ESG Relevance Score of '4' for Governance Structure due to its concentrated ownership, which has a negative impact on the credit profile and is relevant to the ratings in conjunction with other factors. New Fortress Energy Inc. has an ESG Relevance Score of '4' for Exposure to Environmental Impacts due to potential operational challenges related to extreme weather events in its operating regions, which has a negative impact on the credit profile and is relevant to the ratings in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- New Fortress Energy Inc. LT IDR CCC Downgrade B- senior secured LT CCC- Downgrade RR5 CCC+ senior secured LT CCC Downgrade RR4 B- NFE Financing LLC senior secured LT CCC Downgrade RR4 B- ============= E C U A D O R ============= ECUADOR: Moody's Affirms 'Caa3' Foreign Currency Issuer Rating -------------------------------------------------------------- Moody's Ratings has affirmed the Caa3 long-term foreign currency issuer rating of the Government of Ecuador. The outlook remains stable. The affirmation of Ecuador's Caa3 rating reflects a balance between an improving fiscal trajectory and lower financing needs under the IMF program, and the sovereign's poor debt repayment record and persistent financing constraints, which signal material risks to meeting upcoming debt obligations. Despite outperforming IMF fiscal targets and securing multilateral funding likely sufficient to cover 2025 needs, the market issuance assumed under the IMF program needed to honor debt service in 2026-27 is unlikely to materialize. To cover financing gaps, the government may resort to transactions that, in Moody's views, could constitute additional distressed exchanges. The Caa3 rating captures the risk of a new default due to limited financing options. The stable outlook reflects a balance of risks. Policy continuity and fiscal outperformance could help anchor investor confidence, gradually enabling the sovereign to regain market access and eventually meet upcoming external debt obligations. However, downside risks to fiscal performance—stemming from sustained low hydrocarbon prices, weak economic growth, or declining political support for fiscal reforms—could increase financing needs and exacerbate funding pressures. Ecuador's foreign-currency country ceiling remains at Caa2, maintaining the existing one-notch gap between the sovereign rating. The foreign-currency country ceiling reflects weak policy effectiveness and the government's relatively large share in the country's total external debt. Moody's do not assign a local currency country ceiling for Ecuador because the country is fully dollarized. RATINGS RATIONALE RATIONALE FOR THE AFFIRMATION OF THE Caa3 RATING RISK OF FINANCING SHORTFALLS REMAIN HIGH Moody's estimates that central government financing needs will decline to $9.0 billion (7% of GDP) in 2025 from $9.3 billion (7.5% of GDP) in 2024, based on Moody's expectations of a lower fiscal deficit. However, external repayments will increase in 2026 and 2027, mainly to the IMF. A more challenging amortization profile that will result in external repayments increasing to 3.3% of GDP by 2027 from 1.8% in 2024 and declining disbursements from the IMF and other multilaterals in 2026-28 imply the need to regain access to a wider range of financing sources, increasing the risk of a new default due to limited financing options, a main driver underpinning the Caa3 rating. The IMF program contemplates external market issuance of $1.5 billion in 2025 and $2 billion each year in 2026-28 as a key funding source for completing Ecuador's financing needs, a prospect that Moody's believes is unlikely to materialize, based on Ecuador's elevated sovereign spread levels. The authorities recently requested additional funding from the IMF. The $1 billion (0.8% of GDP) in new funding could cover a portion of the financing gap if fiscal targets are met but would be insufficient to offset lack of external market issuance. The IMF expects market issuance to reach $5.5 billion (4.3% of GDP) in 2025-27. However, Ecuador has not regained market access, and external bond issuance in the second half of this year remains unlikely. As such, and given that alternative financing sources appear limited, the authorities may resort to additional distressed buyback operations, including debt-for-nature swaps, to continue bringing down the outstanding stock of external bonds and curbing financing needs. Such transactions could constitute distressed exchange events, which are defaults under Moody's definitions. IMPROVING FISCAL TRAJECTORY, ALTHOUGH RISKS TO FISCAL TARGETS REMAIN Improved fiscal performance in 2024 was driven by stronger revenues and lower expenditure. The central government deficit narrowed to 2.8% of GDP, lower than Moody's 3% forecast. Non-oil revenue was boosted by a three-percentage point increase in the value-added tax (VAT) rate to 15% from 12%, of which one percentage point is a permanent increase and two percentage points are temporary until 2026. Additionally, one-off measures, such as taxing the profits and net assets of banks and corporations, were implemented. Oil revenues also improved due to supportive export prices and the increase in domestic low-octane gasoline prices. On the expenditure side, budget execution was stunted by delays in multilateral financing. The current four-year IMF extended fund facility (EFF) program is ambitious, anchored around a 5.5% of GDP improvement in the non-oil primary balance, including fuel subsidies by 2028 when the program ends. Revenue measures are expected to account for two-thirds of the fiscal improvement, with expenditure efforts contributing the remaining one-third. Moody's baseline assumes a continued, albeit more gradual, consolidation of the central government deficit to 2.3% of GDP this year, 1.8% in 2026 and 1.6% in 2027. However, the central government deficit would remain unchanged at around 3% of GDP in 2025-27 if the expiration of temporary measures is not compensated by new or extended tax measures, leading to financing gaps. RATIONALE FOR THE STABLE OUTLOOK The stable outlook reflects Moody's views that upside and downside risks to Ecuador's credit profile remain balanced. Policy continuity and overperformance on fiscal consolidation targets could gradually help anchor investor confidence, enabling the sovereign to regain market access and thereby reduce risks from forthcoming external debt service obligations. The government is preparing measures to boost offshore oil and gas production and plans to reopen the mining registry that was closed since 2018, measures that would support non-tax revenues and buffer the planned fiscal trajectory. The government's other economic policy priorities include increasing private investment and addressing electricity sector challenges that contributed to the contraction of economic activity in 2024, anchoring the economic recovery that will help increase tax revenues. However, accessing market finance at very high interest rates could lead to a reemergence of liquidity pressures that have led to past debt restructurings. Already in Moody's baseline, interest payments on external market debt will more than double in 2025 compared to 2021, as the step-up coupon from the previous restructuring feeds through a higher cost of debt overall. Lower oil revenues could complicate fiscal consolidation prospects if subdued hydrocarbon prices persist. Additionally, weak economic growth or a decline in political support for the government's fiscal reform agenda could result in higher financing needs and exacerbate funding pressures. ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS Ecuador's ESG Credit Impact Score is CIS-5, reflecting the severe governance challenges in the country that have resulted in multiple defaults, and a high exposure to environmental and social risks. Ecuador's E-5 environmental issuer profile score reflects the country's exposure to carbon transition risks from dependence of exports and government revenue on hydrocarbons. Ecuador is also exposed to physical climate risk. The economy (particularly primary sector activity) has been subject to droughts and floods from the El Niño weather shock that happens at irregular intervals. Ecuador's exposure to social risks (S-4 issuer profile score) reflects the fact that social considerations have played a role in increasing political risk in the country. As illustrated in October 2019, violent protests broke out against government measures to eliminate fuel subsidies, forcing the government to backtrack on the subsidy removal and devise complementary measures in support of fiscal consolidation under an IMF program. A similar pushback occurred in 2022 despite less extensive subsidy reductions. The risk of social unrest constrains the sovereign's ability to adopt policies that address long-standing distortions that inhibit economic growth in the country. Moreover, an abrupt deterioration in security in the country from a marked increase in violence has added new challenges to governability and for economic activity. The influence of governance on Ecuador's credit profile (G-5 issuer profile score) reflects a very weak rule of law, high levels of corruption and the sovereign's default track record. Long-standing concerns about public financial and fiscal management, willingness to repay (which in the past had a hand in defaults), and the overall clarity and predictability of policymaking constrain Ecuador's credit profile. GDP per capita (PPP basis, US$): 15,996 (2024) (also known as Per Capita Income) Real GDP growth (% change): -2% (2024) (also known as GDP Growth) Inflation Rate (CPI, % change Dec/Dec): 0.5% (2024) Gen. Gov. Financial Balance/GDP: -2.8% (2024) (also known as Fiscal Balance) Current Account Balance/GDP: 5.7% (2024) (also known as External Balance) External debt/GDP: 46.8% (2024) Economic resiliency: b2 Default history: At least one default event (on bonds and/or loans) has been recorded since 1983. On June 10, 2025, a rating committee was called to discuss the rating of the Ecuador, Government of. The main points raised during the discussion were: The issuer's economic fundamentals, including its economic strength, have not materially changed. The issuer's institutions and governance strength, have not materially changed. The issuer's fiscal or financial strength, including its debt profile, has not materially changed. The issuer's susceptibility to event risks has not materially changed. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING WHAT COULD CHANGE THE RATINGS UP Continued fiscal consolidation that reduces financing needs, or a substantial increase in available financing –whether through regaining external market access or other means –that allows the sovereign to avoid payment stress, would lower the likelihood of a credit event involving elevated losses to bondholders, supporting a higher rating. WHAT COULD CHANGE THE RATINGS DOWN The reemergence of liquidity pressures, whether due to a material widening of the fiscal deficit or to insufficient financing sources amid a challenging debt maturity schedule, would increase the likelihood of credit events associated with losses that exceed those consistent with a Caa3 rating and lead to a downgrade. The principal methodology used in this rating was Sovereigns published in November 2022. The weighting of all rating factors is described in the methodology used in this credit rating action, if applicable. Ecuador's "ba3" economic strength score is set below the initial score of "ba1" to reflect continued economic concentration and hydrocarbon dependence in addition to competitiveness challenges brought about by dollarization. Ecuador's "caa2" institutions and governance strength score is below the "b2" initial score to reflect the sovereign's track record of default. The "ba1" fiscal strength score is below the "baa3" initial score to reflect the expected deterioration in debt affordability as a result of the step-up coupon rates on external market debt. This leads to a final scorecard-indicated outcome of B3-Caa2, compared to an initial scorecard-indicated outcome of B1-B3. The assigned rating is below the final scorecard-indicated outcome to capture high financing risk that is not fully accounted for in the scorecard. ================= G U A T E M A L A ================= CENTRAL AMERICA BOTTLING: Fitch Affirms 'BB' LongTerm IDRs ---------------------------------------------------------- Fitch Ratings has affirmed The Central America Bottling Corporation's (CBC) Long-Term Foreign and Local Currency Issuer Default Ratings (IDR) and senior unsecured notes at 'BB'. The Rating Outlook is Stable. The affirmation reflects CBC's business position as an anchor bottler of the PepsiCo system, with operations in Central America, the Caribbean, Ecuador, Peru and Argentina. The company has a diversified product portfolio of PepsiCo and proprietary brands across its franchised territories, combined with a good distribution network in key markets. The Stable Outlook incorporates the likelihood that CBC will gradually deleverage int the next 12 to 18 months amid a more challenging consumption environment across some of its territories. Fitch also anticipates the company will refinance its short-term debt and improve its debt maturity profile. Key Rating Drivers Deleverage Expected: Fitch expects CBC's EBITDA leverage to trend towards 3.8x during the next 12 to 18 months. The deleveraging will primarily result from EBITDA growth, stable debt levels, and cash inflows from an intercompany loan of USD682.4 million that CBC provided to its holding company Grupo Mariposa Holding Corp. (MGHC). In 2024, CBC's net debt increased after a corporate reorganization that included a consent solicitation to modify the indenture of its senior notes due in 2029 and MGHC acquisition of a food company named BIA. Stable Operating Performance: Fitch expects CBC to face a weak economic environment for revenue growth in 2025 combined with relatively favorable prices for commodities and raw materials. Fitch estimates revenue will increase to nearly 1% in 2025 and then stabilize at about 5% in 2026-2027, assuming a balanced combination of sales volume growth and pricing initiatives. Fitch anticipates an EBITDA margin (pre-IFRS 16) of around 14% in 2025-2027, given current commodities prices, revenue management strategies, and operating efficiencies from its Atlas project. Neutral to Negative FCF: Fitch forecasts CBC's FCF to be neutral to negative across the rating horizon, mainly due to its capex plans and dividend payments. Capex investments are mainly oriented to strength production capabilities and distribution network, including returnable bottles and coolers at the point of sale. Fitch expects annual cash flow from operations (CFO) for 2025 and 2026 of around USD200 million, with capex of approximately USD135 million and dividends of USD87 million. Solid Position in Core Markets: CBC's ratings reflect its stable market share positions across its operations that result in predictable cash flow generation. The company's carbonated soft drink (CSD) category represents around 52% of total sales volume. CBC is the CSD market leader in Jamaica and has significant positions in other core markets, such as Guatemala, Ecuador and Puerto Rico. In addition, the company has a leading position in juices and nectars in El Salvador, Puerto Rico and Jamaica, as well as in water in Ecuador. Diversified Brand and Product Portfolio: CBC has a portfolio of globally known brands such as PepsiCo and Ambev that are complemented by several proprietary brands grouped under its Beliv business unit. PepsiCo brands contribute about 67% to total sales volume, followed by proprietary brands and beer sales of 28% and 5%, respectively. The product portfolio is among the best balanced among peers in the region, with CSD and non-CSD products representing about 41% each of total sales volume. This product diversification benefits CBC's credit profile, as the company can adapt more easily to changes in consumer preferences. Exposure to Guatemala's Operating Environment: Fitch assigns significant weight to Guatemala's operating environment when assessing CBC's ratings, given the country's importance to the company's consolidated revenue, EBITDA, and total assets. In Fitch's view, CBC's operating performance is closely tied to Guatemala's economic stability and development prospects. While CBC's operations in countries with more favorable operating environments, such as Peru and Puerto Rico, help to mitigate risks, these are largely offset by similarly sized operations in countries with more challenging environments, including El Salvador and Ecuador. Peer Analysis CBC's ratings are lower than those of beverage peers in the region, such as Arca Continental, S.A.B. de C.V. (A/Stable), Coca-Cola FEMSA, S.A.B. de C.V. (A/Negative) and Embotelladora Andina S.A. (BBB+/Stable). This is due to its smaller scale and the weaker recognition of the PepsiCo and proprietary beverage brands compared with the stronger brand equity of Coca-Cola products. CBC's ratings also reflect a narrower profitability margin and higher leverage than the three peers, while its cash flow generation comes mainly from countries with weaker operating environments and higher political risks. However, Fitch believes CBC has a more balanced product portfolio, with lower concentration in CSD. CBC's EBITDA margin of about 14%, is lower than that of Arca, KOF and Andina, which are between 17% to 20%. Also, CBC's consolidated EBITDA net leverage is projected to be below 4.0x, while Andina is at 1.5x, and Arca Continental and KOF, at around 1.0x. Key Assumptions - Revenue growth of 1% in 2025 and 5% on average 2026-2027; - EBITDA margin of approximately 14% on average during 2025-2027; - Annual capex of around USD120 million in 2025 and USD170 million on average during 2026-2027; - Dividend distributions of approximately USD87 million on average in 2025-2027; - Cash inflows from the intercompany loan to MHGC. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - EBITDA margin sustained above 13% on a sustained basis; - A neutral to positive FCF margin on a sustained basis; - Net debt/EBITDA below 3.0x on a sustained basis; - Fitch's perception of more conservative financial policies; - Higher cash flow generation from investment-grade markets and operating environments, such as Peru and Puerto Rico; - Improved economic environments in Guatemala, Honduras, Nicaragua, El Salvador and Ecuador. Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Persistent declines in volume and revenue; - An EBITDA margin sustained below 10%; - Consistent negative FCF that weakens CBC's liquidity position and financial profile; - Net debt/EBITDA above 4.0x on a sustained basis; - Multiple downgrades of Guatemala's Country Ceiling (BBB-) or sovereign ratings. Liquidity and Debt Structure As of March 31, 2025, CBC's liquidity was manageable, given its cash position and investments of USD213 million and USD579 million of short-term debt. The company is in the process of refinancing its short-term debt with a syndicated loan of USD450 million that will improve its debt maturity profile and provide financial flexibility. Issuer Profile CBC produces and distributes CSDs and beverages in Central America, the Caribbean, Ecuador, Peru and Argentina. It has a longstanding relationship with PepsiCo and partners with Ambev to distribute beer in Central America and some countries in the Caribbean. Summary of Financial Adjustments Fitch excludes USD117.1 million in back-to-back loans that the company implemented for its operations in Central America from total debt. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The Central America Bottling Corporation has an ESG Relevance Score of '4' for Management Strategy due to a less conservative approach about its financial position following the intercompany loan transaction, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. The Central America Bottling Corporation has an ESG Relevance Score of '4' for Financial Transparency due to below average financial reporting disclosure practices to investors, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- The Central America Bottling Corporation LT IDR BB Affirmed BB LC LT IDR BB Affirmed BB senior unsecured LT BB Affirmed BB ======= P E R U ======= BANCO INTERAMERICANO: Fitch Affirms 'BB+' IDRs, Outlook Stable -------------------------------------------------------------- Fitch Ratings has affirmed Banco Interamericano de Finanzas S.A.'s (BanBif) Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at 'BB+', and its Viability Rating (VR) at 'bb+'. The Rating Outlook for the Long-Term IDRs is Stable. Fitch has also affirmed Banbif's Local Currency and Foreign Currency Short-Term IDRs at 'B' and Government Support Rating (GSR) at 'bb-'. Key Rating Drivers IDRs Driven by the VR: BanBif's IDR are driven by its 'bb+' VR, which considers the bank's moderate market position and a business model with consistent earnings, lower profitability and tighter capital metrics than regional peers. Moderate Franchise: BanBif's business profile features a mid-size franchise (fifth largest in Peru) with a concentration on commercial loans. This focus contributes to controlled non-performance loss NPL ratios (loans 90+ days past due) but leads to high per-debtor concentrations and comparatively weak revenue generation. In 2024, the bank's total operating income (TOI) stood at USD 207 million, markedly lower than that of Peru's largest banking institutions, underpinning its 'bb+'/stable assessment on this factor. Challenged Asset Quality: BanBif's past-due loans ratio over 90 days increased in 2024 to 3.6% from 3.3% in 2023 due to a weakening retail loan sector affected by higher interest rates and inflation, following a sector-wide trend. The bank faces high concentration risk with its top 20 clients' exposure at 1.4x its common equity Tier 1 (CET1), although, loan loss reserve remained adequate at 151.3% in 2024. Fitch expects BanBif's NPL ratio to reach 3.5%-3.8% in the short term. Profitability in Improved Trend: In 2024, BanBif's profitability level improved for past years. The operating profit-to-risk weighted asset (RWA) ratio at December 2024 was 1.6% from the average of 1.3% between 2021 and 2024. Profits are bolstered by an increasing net interest margin, higher fees and increased interest income from its investment portfolio. In addition, efficiency efforts measured as non-interest expense over gross revenues has improved to 45.2% in 2024 (from 51.4% in 2023). Fitch forecasts the operating profit-to-RWA ratio will stay between 1.5%-1.7% for the next couple of years, consistent with an'bb+'/positive rating. Tight CET1 Ratio: BanBif's CET1 ratio to RWA slightly improved to 10.2% as of December 2024 (9.7% as of December 2023), although Fitch believes is still the bank's main credit weakness, especially when compared to other rated peers in LatAm region. Fitch expects that BanBif will sustain a CET1 capital ratio slightly above the 10% threshold. This stems from the bank's anticipated modest growth trajectory coupled with its restrained capacity for internal capital formation. Nonetheless, the bank's regulatory capital ratio remains well-positioned above the regulatory minimum, a status bolstered by the inclusion of subordinate debt instruments within its capital structure. In its assessment, Fitch considerer the conservative risk-weight calculation for banks in the country. Funding Profile in line with Business Model: BanBif's funding relies heavily on customer deposits. By December 2024, the bank improved its loan-to-deposit ratio to 93.3%, down from 100.1%, due to the rise in deposits and lower loan growth. BanBif also has access to bilateral loans, subordinated debt, and domestic debt issuances. Efforts to shift from institutional to retail deposits continue, despite strong competition from larger banks. The bank possesses a good proportion of highly liquid assets that supports its liquidity management. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - BanBif's IDRs and VR are sensitive to a material deterioration in the local operating environment (OE) or a negative sovereign rating action; - The IDRs and VR could be downgraded if the CET1 to RWA ratio falls consistently below 9% and an increased and sustained NPL ratio over 4%. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - The VR could be upgraded if the bank manages to steadily improve its TOI levels and sustain its operating profit to RWA ratio over 1.5% and CET1 to RWA ratio over 11%. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS GSR The bank's 'bb-' GSR reflects its midsize franchise and lower systemic importance in the context of the investment-grade Peruvian OE. As BanBif is the sixth largest Peruvian bank, Fitch believes the probability of support from the government would be moderate, if required. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES - The GSR would be affected if Fitch negatively changes its assessment of the government's ability and/or willingness to support the bank. - The GSR could also be downgraded if BanBif loses material market share in terms of loans and customer deposits. - Upside potential for the GSR is limited and can only occur over time with material growth of the bank's systemic importance. VR ADJUSTMENTS The OE score has been assigned above the implied score due to the following adjustment reasons: Sovereign rating (positive). ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Banco Interamericano de Finanzas S.A. LT IDR BB+ Affirmed BB+ ST IDR B Affirmed B LC LT IDR BB+ Affirmed BB+ LC ST IDR B Affirmed B Viability bb+ Affirmed bb+ Government Support bb- Affirmed bb- ===================== P U E R T O R I C O ===================== DELTA X1: Seeks to Hire Juan C. Bigas Valedon as Legal Counsel -------------------------------------------------------------- Delta X1, LLC seeks approval from the U.S. Bankruptcy Court for the District of Puerto Rico to employ Juan C. Bigas Valedon Law Office to handle its Chapter 11 case. Juan Bigas Valedon, Esq., the primary attorney in this representation, will be billed at his hourly rate of $350, plus expenses. The firm received a retainer of $10,000 from the Debtor. Mr. Bigas Valedon disclosed in a court filing that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Juan C. Bigas Valedon, Esq. Juan C. Bigas Valedon Law Office P.O. Box 7011 Ponce, PR 00732 Telephone: (259)-1000 Facsimile: (842)-4090 About Delta X1 Delta X1, LLC sought relief under Subchapter V of Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No. 25-02413) on May 29, 2025. In its petition, the Debtor disclosed up to $1 million in estimated assets and up to $50,000 in estimated liabilities. Honorable Bankruptcy Judge Mildred Caban Flores handles the case. Juan C. Bigas Valedon Law Office serves as the Debtor's counsel. NEOLPHARMA INC: Seeks to Extend Plan Exclusivity to July 1 ---------------------------------------------------------- Neolpharma, Inc. asked the U.S. Bankruptcy Court for the District of Puerto Rico to extend its exclusivity periods to file a plan of reorganization and disclosure statement to July 1, 2025. The Debtor explains that post-petition, it has engaged in negotiations with its creditors to resolve several pending matters and is now in the process of reconciling claims. The Debtor is also reviewing its potential new sources of funding to be able to fund its reorganization process. The Debtor claims that it needs more time to conclude these negotiations and/or reconciliation of claims which, if successful, will further the reorganization process without additional litigation. The Debtor asserts that its request to extend the exclusivity period until July 1, 2025, is made in good faith and with no intent to delay the proceedings. On the contrary, if the Debtor is successful in its negotiation with creditors, it will be able to propose a Plan and avoid unnecessary litigation. This is in the benefit of creditors. This forty-day extension does not cause harm to creditors, on the contrary they will be benefitted by the same and litigation may be avoided. The Debtor further asserts that given the nature of the case, the stage of the proceedings, the fact that the Debtor is in full compliance with its duties under the Bankruptcy Code and the Guidelines of the US Trustee, as well as the fact that this time will also allow the Debtor to conclude other negotiations with counterparties to executory contracts that will assist the operations of the Debtor, "cause" for the extension requested exists. Neolpharma Inc. is represented by: Carmen D. Conde Torres, Esq. C. Conde & Assoc. 254 De San Jose Street, Suite 5 Old San Juan, PR 00901 Telephone: (787) 729-2900 Facsimile: (787) 729-2203 Email: condecarmen@condelaw.com About Neolpharma Inc. Neolpharma Inc. is a privately-held company that specializes in the manufacturing of pharmaceutical products. Neolpharma Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No.: 25-00188) on January 22, 2025. In its petition, the Debtor reports total assets of $29,049,165 and total liabilities of $21,068,886. The Debtor tapped Carmen D. Conde Torres, Esq., at C. Conde & Assoc. as counsel and RSM Puerto Rico as accountant. ===================================== T R I N I D A D A N D T O B A G O ===================================== TRINIDAD & TOBAGO: Energy Consumption Culture Unsustainable ----------------------------------------------------------- Andrew Gioannetti at Trinidad and Tobago Newsday reports that Trinidad and Tobago's entrenched culture of excessive energy consumption – fuelled by artificially low electricity prices and decades of policy inertia – remains one of the country's biggest obstacles to achieving meaningful energy efficiency. That was the frank assessment of energy policy and industry leaders speaking at the Caribbean Sustainable Energy Conference on June 3 at the Hilton Trinidad and Conference Centre, St Ann's, according to Trinidad and Tobago Newsday. The session, dedicated to strategies for reducing consumption and improving efficiency, made clear that while bright spots exist, the country remains far behind regional peers and global benchmarks, the report notes. Dr Mohammad Rafik Nagdee, executive director of the Caribbean Centre for Renewable Energy and Energy Efficiency (CCREEE), outlined the fundamental issue, the report relays. "Because the energy affordability is so significant, it is so low,” he said, noting a habit some have of leaving multiple air-conditioning units on at home throughout the day even when they aren't needed, the report discloses. There's little incentive to conserve, he suggested, adding that it has consequences for the entire region's decarbonisation ambitions, the report notes. He cited that TT's highly subsidised domestic power rates are among the lowest in the hemisphere, a fact that discourages conservation and efficiency upgrades, the report relays. "We're not saying raise prices, but this is where energy efficiency really matters,” he added. Ten out of 17 Caricom states have adopted minimum energy efficiency regulations, yet TT lags behind on several indicators, Nagdee noted, the report relays. Additionally, he flagged the tourism sector as an overlooked opportunity for demand management, advocating for the use of artificial intelligence to optimise hotel energy consumption, the report says. Nagdee stressed that simple behavioural changes – such as moderating air-conditioning use – could significantly ease the country's energy burden and assist in meeting its Paris Agreement commitments, the report notes. Eugene Tiah, president of the Caribbean Energy Chamber, delivered a stark technical assessment of TT's power system, detailing inefficiencies from generation to end-user, the report relays. "Nearly all our electricity is generated from natural gas, and despite years of discussion around energy efficiency, gas consumption for power generation has steadily increased,” Tiah said. He attributed a temporary dip in 2020 to the pandemic but noted that overall demand continues to rise, particularly in the residential sector, the report discloses. Between 2010 and 2024, industrial consumption as a share of total demand fell from nearly 60 per cent to around 40 per cent due to the closure of large facilities like the steel plant, while residential consumption surged, the report relays. "And that has been growing particularly (because of) air-conditioning loads,” Tiah explained. On the supply side, Tiah highlighted the inefficiency of the generation fleet, the report relays. Trinidad Generation Unlimited's (TGU) combined-cycle plant operates at an efficient heat rate of around 8,800 BTU per kilowatt-hour, the report notes. In contrast, other plants in the national mix have heat rates as high as 17,000, more than double the gas input for the same output, the report says. The report relays that he said if we could bring all generation to TGU's efficiency level, "we could certainly reduce the amount of energy that it takes to produce a kilowatt hour of power.” Transmission and distribution losses also remain a concern. Tiah noted that while benchmark countries like the United States have achieved five per cent system losses, TT's losses remain higher; precise national figures are difficult to obtain, he admitted, owing to fragmented reporting. Jamaica also experiences far greater losses, mostly attributed to theft, the report discloses. A business Case for Efficiency Beyond environmental arguments, the speakers stressed the economic rationale for improving efficiency, the report relays. Tiah presented a business model showing that a ten per cent reduction in national electricity demand would free up natural gas currently priced to T&TEC at US$1.70 per MMBtu, the report notes. If that gas were instead sold to petrochemical producers at a higher price, the country could capture up to US$85 million in net economic gains, assuming favourable commodity market conditions, the report relays. "There is some economics in terms of driving more efficiency. So if you're not getting on board because, you know, you're concerned about the environment, surely pure economics should be a driver for you to want to do something,” the report discloses Both speakers pointed to existing tools and strategies, the report says. Nagdee spoke about policy reform, stronger regulation and public education campaigns, the report discloses. He also urged TT to align with regional data-sharing initiatives and complete overdue energy reporting updates, the report notes. Tiah advocated for accelerating the formal establishment of energy service companies (ESCOs) to implement performance-based efficiency projects, noting that certification criteria for ESCOs had already been drafted, the report relays. He also flagged the need for standardised performance contracts and tailored financing products from local banks, the report discloses. "If you all don't get onto this playing field … very likely we'll just be continuing to have these conversations. We would all be complicit if we see this as someone else's problem. This is our problem. This is our issue. We have to own it.” The conference's clear consensus: TT's energy consumption patterns are unsustainable, the report notes. But with straightforward policy adjustments, behavioural interventions, and system upgrades, significant efficiency gains are within reach, the report says. The choice now is whether the country will act decisively, or continue – in Nagdee's words – to be "the elephant in the room," the report adds. TRINIDAD & TOBAGO: Rising Import Costs Outpace Export Earnings -------------------------------------------------------------- Joel Julien at Trinidad Express reports that Trinidad and Tobago is expected to run a balance of payments (BOP) deficit in 2025, as money flowing out of the country due to rising import costs and overseas investments outpaces earnings from exports, the Central Bank has stated. "Trinidad and Tobago's overall BOP is anticipated to record a deficit in 2025. This performance will stem from a surplus on the current account, owing to a healthy goods balance, coupled with a net outflow on the financial account, driven by increased portfolio and other investments, according to Trinidad Express . "Notwithstanding, the varying tariffs implemented by the US can add upward pressure to import prices. The Central Bank will continue to closely examine developments and stands ready to take appropriate actions to safeguard internal and external stability,” the Central Bank's Monetary Policy report for May 2025 has stated, the report relays. According to the Central Bank, this country's goods trade balance deteriorated as imports gained momentum, the report relates. "Over the fourth quarter of 2024, the goods balance decreased by 37.5% (year-on-year) to US$417.5 million, when compared to the similar quarter of 2023. Despite a minor improvement in exports, it was not sufficient to temper the growth in imports. Total export earnings increased by 3.5% to US$2,430.7 million in the fourth quarter of 2024," it stated, the report notes. "The slightly higher outturn stemmed from an improvement in non-energy exports, which expanded by US$116.7 million or 30.4% (year-on-year) to US$500.1 million. Somewhat dampening the overall increase in export earnings, energy exports recorded a minor falloff of 1.7% (year-on-year) to US$1,930.5 million in the fourth quarter of 2024, compared to the same period in 2023,” the Central Bank stated, the report relays. The Central Bank stated that the reduction in energy exports was attributable to a sizeable 35.4% decline in the gas sub-category on account of lower international gas prices and export volumes, the report notes. "Notwithstanding, exports of petroleum, crude and refined products and petrochemicals, grew by 19.3 and 15.1% (year-on-year), respectively, reflecting higher international prices for methanol, coupled with increased export volumes of ammonia, urea, and petroleum products," it stated, the report discloses. Over the fourth quarter of 2024, methanol, ammonia and urea prices averaged US$590.7 per tonne, US$524.0 per tonne and US$320.9 per tonne, respectively, the report relates. The Central Bank stated that this country's total imports increased by US$333.5 million to US$2,013.2 million during the fourth quarter of 2024, the report recalls. Non-fuel imports picked up by US$219.7 million or 16% (year-on-year) to US$1,592.6 million. Notably, this outturn was driven by an increase in imports of manufactured goods and capital imports. Fuel imports increased by 37.1% (year-on-year) to US$420.6 million, which was due to an "uptick in imports of refined products for the purpose of exporting to regional markets,” it stated. The Central Bank stated that portfolio investment accounts registered a net outflow in the fourth quarter of 2024, the report recalls. Portfolio investment recorded a net outflow of US$28.8 million, driven primarily by increased holdings of portfolio assets abroad (US$30.3 million) in the fourth quarter of 2024, it stated, the report notes. "In particular, there was a rise in short-term debt securities held by domestic banks during the period. Compounding this was a moderate increase in foreign equity securities held by the Heritage and Stabilisation Fund (HSF) and pension funds. Portfolio investment liabilities increased marginally over the reference period (US$1.5 million) as non-residents increased their holdings, mainly of long-term domestic debt securities,” it stated, the report says. "Meanwhile, the net outflow of US$284.7 million recorded in the direct investment category stemmed largely from a reduction of US$229.9 million in direct investment liabilities (direct investment in Trinidad and Tobago by foreign investors). This outturn reflected a decline in equity capital by energy sector companies. Compounding this flow was the simultaneous rise in direct investment assets (US$54.8 million) due to an uptick in intercompany lending among associated enterprises in the energy sector," the Central Bank stated, the report adds. =============== X X X X X X X X =============== LATAM: New Brazil-Caribbean Deal Aim to Revitalize Commerce ----------------------------------------------------------- Iolanda Fonsec at Rio Times Online reports that Brazil hosted the Brazil-Caribbean Summit in June 2025 in Brasília, aiming to revitalize its relationship with Caribbean nations through a series of cooperation agreements. Official sources confirm that leaders from CARICOM, Cuba, the Dominican Republic, and key regional organizations attended, focusing on food security, climate action, energy, disaster management, and connectivity, according to Rio Times Online. Brazil and the Caribbean have seen their trade drop from $6 billion in 2010 to $4 billion in 2024, the report notes. Most of this commerce centers on Guyana, the Dominican Republic, and Trinidad and Tobago, the report relays. The summit addressed this decline by prioritizing projects that reduce trade barriers and improve logistics, the report discloses. Brazil's Ministry of Ports and Airports is targeting $35.4 billion in foreign investments by 2026 to modernize ports and airports, with 90% of funding expected from private sources, the report says. The plan includes 60 port and airport auctions, a $1 billion subaquatic tunnel at Santos, and $850 million for Northern Arc waterways, the report discloses. These upgrades aim to streamline the 97% of Brazilian trade that moves through ports and position Brazil as a key trade gateway for the hemisphere, the report relates. The summit also pushed for better regional connectivity. Leaders discussed new air, sea, and land routes to cut transport costs and boost commerce, the report says. These efforts align with Brazil's infrastructure push, which has already seen a 15% rise in container throughput since 2023, the report recalls. Security cooperation took center stage, especially regarding Haiti. Brazil committed to training 400 Haitian police officers to help address the country's security crisis, the report notes. The Brazilian Cooperation Agency and the Federal Police will lead this initiative, focusing on building local capacity rather than deploying troops, the report relays. Human rights groups have called for careful vetting of trainers, and Brazil has emphasized respect for local authority. The summit further strengthened technical cooperation, the report relays. Brazil signed a Basic Agreement with the Association of Caribbean States to support joint projects in climate change, disaster risk reduction, and food security, the report notes. Both sides see these partnerships as essential for regional resilience, the report adds. ********* 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. The TCR Latin America subscription rate is US$775 per half-year, delivered via e-mail. 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