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250811.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 Monday, August 11, 2025, Vol. 26, No. 159 Headlines A R G E N T I N A ARGENTINA: Milei Vetoes Pension Increases in Bid for Balance B R A Z I L AZUL SA: Secures $650 Million Investment Commitment BRAZIL: Demands Fair Play on Tariffs BRF SA: S&P Upgrades ICR to 'BB+', Outlook Stable C O L O M B I A COLOMBIA: Economy Navigating Complex Landscape, IMF Says D O M I N I C A N R E P U B L I C AEROPUERTOS DOMINICANOS: Moody's Ups Rating on Secured Notes to Ba1 BANCO DE RESERVAS: Moody's Ups Long Term Deposit Ratings to Ba2 J A M A I C A JAMAICA: Raises $7.5 Billion Through Auction of Treasury Bills M E X I C O LEISURE INVESTMENTS: Seeks to Extend Plan Exclusivity to Oct. 27 P U E R T O R I C O GRUPO HIMA: Court Amends Order on Nova Infusion Asset Sale - - - - - ================= A R G E N T I N A ================= ARGENTINA: Milei Vetoes Pension Increases in Bid for Balance ------------------------------------------------------------ Buenos Aires Times reports that President Javier Milei vetoed a law approved by Congress to increase pensions for the elderly and the disabled, arguing it undermined his attempts to balance Argentina's budget. It was the second time since August 2024 that Milei -- a self-declared "anarcho-capitalist" -- has prevented a pension increase, according to Buenos Aires Times. In a notice published in the government's Official Gazette, Milei also scrapped a provision that had temporarily allowed pensions for people who had not contributed to the system for the required 30 years, the report notes. More than 40 percent of work in Argentina is in the informal sector, meaning many people are excluded from the state pension, the report notes. Milei took office in December 2023, having wielded a live chainsaw during his successful election campaign to symbolize his project to dramatically cut state spending, the report discloses. He has suspended public works projects, laid off tens of thousands of civil servants, gutted state agencies and reduced aid, the report relays. The crisis-hit economy registered its first budget surplus in 14 years in 2024, and annual inflation fell to 39.4 percent in June -- down from 211 percent at the end of 2023 and 118 percent last year, the report says. But the measures were blamed for tipping millions more people into poverty in the first half of 2024, and brought tens of thousands onto the streets in protest, the report notes. Researchers say pensioners are the hardest hit by Milei's austerity measures, the report relays. Retirees have been protesting weekly outside Congress for months, often met with repression by the security forces, the report says. Benefits for those who qualify are enough to cover only a third of the basket of basic goods, around US$275, per month at the official exchange rate and more than 70 percent of retirees live below the poverty line, the report discloses. Milei's government has argued that the retirement and disability pension increases were "irresponsible" as they "jeopardize" efforts to achieve fiscal balance, the report notes. The increases would have cost the government an additional US$5 million this year, and US$12 million in 2026, it said, the report relates. Argentina's Congress, where Milei does not have a majority, can technically override the presidential veto with two-thirds of lawmakers in agreement, according to the report. Milei's latest vetoes come a week after a presidential decree that lowered taxes on grain and meat exports, the report relays. The President had already vetoed a funding increase for universities, which keep their revenues tied to the 2023 budget, the report recalls. He also vetoed a law declaring an emergency in the care of people with disabilities in order to regularize the back payments of health benefits and guarantee them until December 2027, the report notes. According to estimates by the Congressional Budget Office, the Disability Emergency Law had a fiscal impact of between 0.22 percent and 0.42 percent of GDP, the report 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. Moody's Ratings on July 17, 2025, upgraded Argentina's long-term foreign currency and local currency issuer ratings to Caa1 from Caa3 and changed the outlook to stable from positive. The upgrade reflects Moody's views that the extensive liberalization of exchange and (to a lesser extent) capital controls, alongside a new International Monetary Fund (IMF) program, support the availability of hard currency liquidity and ease pressure on external finances. This reduces the likelihood of a credit event. In January 2025, Moody's raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. 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+'. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. =========== B R A Z I L =========== AZUL SA: Secures $650 Million Investment Commitment --------------------------------------------------- Reuters reports that Brazilian airline Azul said it signed an agreement with certain stakeholders for a $650 million investment in a future capitalization deal, according to a securities filing. The airline's so-called "backstop commitment agreement" must be approved by the U.S. court overseeing its bankruptcy proceedings, the filing said, notes the report. In May, Azul filed for chapter 11 bankruptcy protection in the United States after months of trying to restructure mostly pandemic-era debt, recalls Reuters. About Azul S.A. Azul S.A. (B3: AZUL4, NYSE: AZUL), the largest airline in Brazil by number of flight departures and cities served, offers 900 daily flights to over 150 destinations. With an operating fleet of over 200 aircrafts and more than 15,000 Crewmembers, the Company has a network of 300 non-stop routes. Azul was named by Cirium (leading aviation data analysis company) as the most on-time airline in the world in 2023. In 2020, Azul was awarded best airline in the world by TripAdvisor, the first time a Brazilian flag carrier earned the number one ranking in the Traveler's Choice Awards. On the Web: http://www.voeazul.com.br/imprensa On May 28, 2025, Azul S.A. and 19 affiliated debtors filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 25-11176). The cases are pending before Judge Sean H. Lane. The Company is supported by Davis Polk & Wardwell LLP, White & Case LLP, and Pinheiro Neto Advogados as legal counsel; FTI Consultingas financial advisor; Guggenheim Securities, LLC as investment banker; SkyWorks Capital LLC as fleet advisor; and FTI Consulting, C Street Advisory Group, and MassMedia as strategic communications advisors. Stretto is the claims agent. The Participating Lenders are supported by Cleary Gottlieb Steen & Hamilton LLP and Mattos Filho as legal counsel and PJT Partners as investment banker. United Airlines is supported by Hughes Hubbard & Reed LLP and Sidley Austin LLP as legal counsel and Barclays Investment Bank as investment banker. American Airlines is supported by Latham & Watkins LLP as legal counsel. AerCap is supported by Pillsbury Winthrop Shaw Pittman LLP as legal Counsel. The U.S. Trustee for Region 2 appointed an official committee to represent unsecured creditors in the Chapter 11 cases of Azul S.A. and its affiliates. BRAZIL: Demands Fair Play on Tariffs ------------------------------------ Iolanda Fonseca at Rio Times Online reports that Brazilian President Luiz Inacio Lula da Silva made it clear: Brazil will not seek a fight with the United States, but refuses humiliation as new U.S. tariffs penalize key Brazilian exports. Starting August 6, 2025, the U.S. will charge a 50% tariff on a large share of Brazilian goods, directly impacting over one third of Brazil's exports to America, according to Rio Times Online. This move mainly targets Brazil's agricultural powerhouse, including beef, coffee, and fruit, but some sectors such as aircraft and minerals remain partly exempt, the report notes. Lula stated that while Brazil won't retaliate blindly, it expects to be treated as a partner, not a "minor country," the report relays. He directly rejected any U.S. attempts to pressure Brazil's courts or influence political cases, especially regarding the recent trials of ex-president Jair Bolsonaro, the report discloses. This is not just about taxes, notes the report. It is about how nations treat each other and defend their own interests, the report says. The United States remains Brazil's second-largest trading partner, with $40 billion in U.S. goods exported to Brazil in 2024, the report relays. Still, Brazil has diversified more than ever, expanding ties with many other countries, especially through the BRICS economic group, the report notes. Brazil's government signaled that it can and will respond if needed, using tariffs or other measures, the report discloses. At the same time, officials stress that Brazil wants negotiations and fair treatment, not an escalating trade war, the report says. Behind the headlines, this growing trade dispute reflects a larger global trend: countries like Brazil are seeking more independence in how they trade and pay, according to Rio Times Online. Brazil is working with China, Russia, and others in BRICS to rely less on the U.S. dollar for global business, the report relays. In daily life, over 76% of Brazilians already use fast digital payments, showing how Brazil's economy is modernizing. These new tariffs risk hurting both sides, the report discloses. Brazilian companies face higher costs and the threat of job losses; U.S. buyers could end up paying more for Brazilian goods, the report says. Lula's government says it will support businesses and workers hit hardest and keep the door open to talks with Washington, the report adds. About Brazil Brazil is the fifth largest country in the world and third largest in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian general election. He was sworn in on January 1, 2023, as the 39th president of Brazil, succeeding Jair Bolsonaro. In October 2024, Moody's Ratings upgraded the Government of Brazil's long-term issuer and senior unsecured bond ratings to Ba1 from Ba2, the senior unsecured shelf rating to (P)Ba1 from (P)Ba2; and maintained the positive outlook. S&P Global Ratings raised on Dec. 19, 2023, its long-term global scale ratings on Brazil to 'BB' from 'BB-'. Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. DBRS' credit rating for Brazil was last reported at BB with stable outlook at July 2023. BRF SA: S&P Upgrades ICR to 'BB+', Outlook Stable ------------------------------------------------- S&P Global Ratings removed its issuer credit ratings on BRF S.A. from CreditWatch with positive implications and raised the ratings to 'BB+' from 'BB'. S&P also raised its issue ratings on the senior unsecured notes issued by BRF GmbH to 'BB+' from 'BB' and affirmed the recovery rating of '3' (65%). BRF's stand-alone credit profile (SACP) remains 'bb'. At the same time, S&P affirmed its 'brAAA' national scale rating on BRF. The stable outlook now reflects the one on Marfrig. S&P expects BRF to sustain leverage below 2.0x in the next two years despite higher dividends and capital expenditures, maintaining adequate cushion to face potentially weaker industry conditions. The upgrade follows the change in S&P's view of BRF's group status for Marfrig. On Aug. 5, 2025, BRF S.A. and Marfrig Global Foods S.A. (global scale: BB+/Stable/--; national scale: brAAA/Stable/--) announced both of their shareholder assemblies had approved Marfrig's full incorporation of BRF. The upcoming full incorporation and ownership, coupled with the key role BRF has had for the consolidated group in terms of strategy and results, led us to reassess the subsidiary's group status as core (versus S&P's previous view of strategically important). S&P now views BRF's credit quality as aligned with Marfrig's. Marfrig has been increasing its stake in BRF since it acquired a minority stake in 2021. It currently holds a 58.87% stake. S&P said, "We believe the proposed full incorporation of BRF by Marfrig just approved by both companies' shareholders shows the key role of BRF for the group's overall strategy. In 2024, BRF represented more than 70% of Marfrig's EBITDA, and we expect this to remain at the same level for 2025." S&P said, "Furthermore, we believe the potential merger will strengthen BRF's overall credit quality as it will benefit from the broader geographic and portfolio diversification, bearing the same credit risk as the combined group. BRF will eventually be absorbed by MBRF once the merger is concluded, but for now, we view its group status as core." The final incorporation still depends on the conclusion of additional steps. Those include the final approval by the Brazilian antitrust authority and the conclusion of the period related to the withdrawal right for minority shareholders that did not vote in favor of the merger. Still, S&P believes the risks of the merger not happening are currently minimal. The incorporation will happen through a share swap where BRF's minority shareholders will swap one share in BRF for a 0.8521 share in Marfrig, and eventually the combined company MBRF. The deal involves additional dividend payments for shareholders that accept the swap: Brazilian real (R$) 3.5 billion from BRF and R$2.5 billion from Marfrig to be paid in the fourth quarter of 2025, but that could change depending on the number of shareholders that choose the withdrawal right. S&P said, "Our rating on Marfrig already incorporates its full consolidation of BRF, given the former's control of the latter. Therefore, we expect the future combined company MBRF Global Foods S.A. will carry the same risk as Marfrig does currently. "Once fully incorporated, we expect the owner of Marfrig, MMS S.A. (not rated), will likely control MBRF, and the terms and conditions for the debts at BRF and Marfrig will likely converge in terms of guarantees, covenants, and costs." Still solid profitability will sustain cash flows and low leverage at BRF. Although Brazil has been declared free of bird flu for commercial purposes, some countries, like China, continue imposing restrictions on Brazilian poultry exports, which has weakened prices since mid-May. Still, strong performance in the processed food division, both domestically and in the external markets, and declining corn and soybean costs should allow BRF to keep margins around 15% and nominal EBITDA around R$10 billion in 2025. With prudent working capital management, despite the potential for higher inventories amid the export restrictions, we forecast EBITDA to translate to solid cash flows. S&P said, "We expect EBITDA to be more than enough to support interest expenses (at around R$2.7 billion), capex (R$3.5 billion), and higher dividends from the transaction (R$ 3.5 billion). We also expect BRF to be able to maintain low leverage, measured as adjusted debt to EBITDA, comfortably below 2.0x in 2025." S&P said, "We don't anticipate any material impact to BRF from the expected 50% tariffs from the U.S. government on protein in general. However, how trade flows adapt could eventually have indirect impacts on prices and costs. Still, we consider BRF has good cushion in its margins and metrics to support potentially weaker market conditions. "The stable outlook reflects that on Marfrig, as we now view BRF as a core subsidiary, with both entities bearing the same default risk. It also reflects our expectation that BRF's recent efficiency measures and debt reduction, coupled with a prudent approach toward investments and dividends, will allow the company to maintain EBITDA margins consistently above 12% and debt to EBITDA below 2.0x in the next 12-18 months. These metrics indicate an adequate cushion to profitability and leverage, limiting potential downside if industry conditions deteriorate. "We would downgrade BRF if we took the same action on Marfrig. We could revise downward BRF's SACP if we see weakening industry conditions, with players' increasing processing capacity resulting in excess supply or much higher input costs creating distorted and volatile margins, despite the company's efficiency initiatives. Such conditions, coupled with a more aggressive approach to capex and dividends, would cause leverage to approach or exceed 3x, while funds from operations (FFO) to debt would remain below 30% and free operating cash flow (FOCF) would be pressured or even negative. "An upgrade of BRF would depend on the same action on Marfrig. We could revise up BRF's SACP in the next 12-18 months if the company maintains more stable margins, in line with our base-case scenario. In such a scenario, we would expect BRF to manage dividends and capex to maintain debt to EBITDA below 2.0x, as measured by a three-year moving average over the normal course of the industry cycle." =============== C O L O M B I A =============== COLOMBIA: Economy Navigating Complex Landscape, IMF Says -------------------------------------------------------- An International Monetary Fund staff team concluded its visit to Bogota following a series of constructive discussions with the Colombian authorities on recent economic developments, outlook, risks, and policy priorities. This engagement follows visits earlier in the year and our ongoing discussions with the authorities. According to the IMF, the Colombian economy is navigating a complex landscape, marked by both progress and growing challenges. While growth has strengthened and inflation has declined, fiscal challenges persist and private investment remains subdued. External headwinds also cloud the outlook. The economy, after expanding by 1.7 percent in 2024, grew by 2.7 percent in Q1:2025, driven by private consumption amid a robust labor market and a strong services sector. Headline inflation declined to 4.8 percent (yoy) in June, supported by appropriately tight monetary policy, while underlying inflation pressures persist. The current account deficit narrowed to 1.7 percent of GDP last year, driven by strong remittances but also sharply lower dividend payments and lagging investment. International reserves have been further strengthened and remain adequate. The financial system remains sound and resilient. Meanwhile, the central government overall fiscal deficit rose to 6.7 percent of GDP in 2024, up from 4.2 percent of GDP in 2023. As a result, gross public debt has risen to 61.2 percent of GDP by end-2024, underscoring the need for sustained efforts over the medium-term as envisaged in the most recent Medium Term Fiscal Framework (MTFF), where the authorities also made use of the escape clause of the fiscal rule to recalibrate the fiscal path for 2025-27. The draft budget for 2026 targets an overall deficit of 6.2 percent of GDP, in line with the MTFF, and a primary deficit of 2 percent of GDP (up from 1.4 percent of GDP in the MTFF), to be financed mostly by a tax reform proposal. Regarding the outlook, real GDP growth is projected to reach around 2½ percent this year, supported in part by some easing of fiscal policy, before converging to potential over the medium term. Inflation is expected to continue declining and reach the 3 percent target by early 2027, contingent on the continued implementation of prudent monetary policy. The current account deficit is projected to widen somewhat this year (to about 2½ percent of GDP), due in part to weaker terms of trade and higher fiscal deficits, which is now expected to reach 7.1 percent of GDP by end-2025 before declining, assuming the steady implementation of policies consistent with the authorities' budget and medium-term fiscal plan. Risks to this outlook remain tilted to the downside. Heightened global uncertainty and geopolitical tensions could weigh on growth, through both real and financial channels, while stricter immigration policies in host countries could negatively impact remittances. Domestically, uncertainty around implementation of policies and reforms could further hold back investment. The team thanks the Colombian authorities for their warm hospitality and the productive discussions. The IMF Executive Board's consideration of the Article IV Consultation will take place in due course. As reported in the Troubled Company Reporter on Aug. 7, 2024, Fitch Ratings has affirmed Colombia's Long-Term Foreign Currency Issuer Default Rating (IDR) at 'BB+' with a Stable Rating Outlook. =================================== D O M I N I C A N R E P U B L I C =================================== AEROPUERTOS DOMINICANOS: Moody's Ups Rating on Secured Notes to Ba1 ------------------------------------------------------------------- Moody's Ratings has upgraded Aeropuertos Dominicanos Siglo XXI, S.A.'s ("AERODOM") senior secured notes to Ba1 from Ba2. The outlook has been changed to stable from positive. The rating action follows the ratings upgrade of the Government of Dominican Republic (Ba2 stable). RATINGS RATIONALE The upgrade of AERODOM's senior secured notes to Ba1 reflects the improvement in credit quality of the Government of Dominican Republic, as AERODOM's six airports are located within the country and operate under a regulated public concession. In particular, the recent improvements to the government's institutional quality and governance strength are credit positive developments for AERODOM, as it enhances the predictability and sustainability of its operating environment. This rating action also acknowledges AERODOM's robust financial metrics, projecting an average 3.0x FFO/interest coverage and 15.2% FFO/debt leverage over the next three years. These projections remain solid even under Moody's revised base case scenario that account for lower-than-anticipated passenger traffic in 2025 and lower growth forecast. The current one notch rating uplift from the sovereign credit rating reflects AERODOM's track record of strengthening credit metrics, a limited reliance on domestic funding sources, a limited exposure to foreign exchange risk given that regulated tariffs are US dollar denominated, and a significant diversification of cash flow that stems from international passengers, and which airlines collect and transfer to offshore accounts. It also consider the liquidity provisions through the six-month debt service reserve accounts. Supporting AERODOM's Ba1 rating is the 30-year concession agreement which allow for continued and automatic tariff adjustments indexed to US CPI, along with an advantageous demographic and passenger profile mix composed predominantly by origin and destination passengers that leads to relatively stable traffic. Further contributing to the cash flow's quality is a diverse carrier base, although some non-recurring events associated with airlines' strategic decisions regarding routes and aircraft sizes have caused deviations from the management's initial traffic forecast for 2025-2027. The credit linkages with the Government of Dominican Republic continue to constrain the rating. Moody's also considers AERODOM's relatively small market share of air travel in the region and its exposure to environmental risks. Due to the airports' location in the Caribbean and the potential operational disruption that could derive from hurricanes, Moody's recognize a high exposure to physical climate events. RATING OUTLOOK The rating outlook is stable mirroring the outlook on the sovereign rating in the Government of Dominican Republic. It is also reflecting Moody's expectations of a traffic performance in 2025 that is roughly 15% lower than in 2024, but fully recovering in 2026, sustaining projected financial metrics within rating action triggers in the next 12-18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING The rating would be upgraded if the credit rating of the Government of Dominican Republic and its institutional and governance strength are upgraded, while quantitatively FFO/Debt and (FFO + interest expense / interest expense) metrics remain strongly positioned above 11% and 3.5x respectively, on a sustained basis. The rating would be downgraded if the rating of Dominican Republic is downgraded. The rating would also face negative pressure if the company faces substantial passenger traffic volatility that reverts the expected traffic growth rate. Quantitatively, if FFO/Debt and (FFO + interest expense / interest expense) metrics are positioned on a sustained basis below 7% and 2.0x respectively, the rating could face negative pressure. PROFILE AERODOM, owned by the experienced concessionaire Vinci S.A. (A3 stable), is the operator of six airports in the Dominican Republic through a long-term concession granted by the government with and extended expiration due 2060. The airport portfolio is composed by Las Americas International Airport in Santo Domingo, the Gregorio Luperón International Airport in Puerto Plata, El Catey International Airport in Samaná, the María Montez International Airport in Barahona, the Arroyo Barril Domestic Aerodrome in Samaná and La Isabela International Airport in Santo Domingo. The principal methodology used in this rating was Privately Managed Airports and Related Issuers published in November 2023. The net effect of any adjustments applied to rating factor scores or scorecard outputs under the primary methodology(ies), if any, was not material to the ratings addressed in this announcement. The difference between the scorecard-indicated outcome of Baa2 and the actual rating assigned of Ba1 is two notches, reflecting the company's credit links with the Government of Dominican Republic and its exposure to the local operating environment and regulatory framework. BANCO DE RESERVAS: Moody's Ups Long Term Deposit Ratings to Ba2 --------------------------------------------------------------- Moody's Ratings has upgraded Banco de Reservas de la Republica Dominicana's (Banreservas) local and foreign currency long-term deposit ratings to Ba2 from Ba3, and its baseline credit assessment (BCA) and adjusted BCA to ba2, from ba3. The bank's long-term counterparty risk ratings and counterparty risk assessment were also upgraded to Ba1 and Ba1(cr), from Ba2 and Ba2(cr) respectively. At the same time, the short-term deposit ratings and counterparty risk ratings were affirmed at Not Prime and the short-term counterparty risk assessment was affirmed at Not Prime(cr). The outlook on the bank's long-term deposit ratings was changed to stable, from positive, following the change in the outlook for the Government of Dominican Republic (DR) to stable. For details about the sovereign rating action, please refer to Moody's press release "Moody's Ratings upgrades Dominican Republic's ratings to Ba2, changes outlook to stable", dated August 01, 2025. RATINGS RATIONALE The upgrade of Banreservas' BCA to ba2 reflects the bank's consistent performance over the past five years, marked by its track record of solid asset quality, strong recurring profitability, and a stable liquidity profile. As the largest bank in the system, Banreservas benefits from a well-established franchise that ensures consistent access to core deposits—not only from households and the private sector, but also from the government and affiliated entities. With a market share of nearly 40% of total system deposits in March 2025, Banreservas reports a consistently growing deposit base, which reduces its needs to seek for higher-cost market-based resources. The bank's prudent underwriting standards, diversified business model, and the Dominican Republic's robust economic performance have all contributed to maintaining good asset quality, even amid rapid credit expansion since 2022. As of March 2025, credit grew by 10% year-over-year, while problem loans stood below 1% since 2022, well below the system average of 1.2% as of March 2025. Moreover, the bank maintains robust loan loss reserves that covered nonperforming loans by 4.9 times in March 2025. Despite the strong economic dynamism and solid macroeconomic fundamentals, asset quality will face pressure in the coming quarters, as a result of a continued credit deepening in the country and high rates. This is further exacerbated by a higher share of deteriorated restructured loans and the risks stemming from correlated sector exposures within the loan portfolio. Banreservas' ba2 BCA also reflects only modest improvement in its capital position since 2023, as measured by out tangible common equity to risk-weighted assets ratio, which rose to 11.9% in March 2025, up from 10.8% a year earlier, resulted from earnings retention. Profitability remains above the 2017–2019 average, although it is gradually normalizing toward historical levels. In March 2025, net income to tangible assets declined to 1.8%, down from 2.3% in March 2024, primarily due to persistently high funding costs and increased credit costs associated with its strong loan growth, particularly in higher-risk consumer lending segments. As a bank 100% owned by the government, Moody's assesses Banreservas as government-backed institution. As such, the bank's Ba2 deposit ratings as well as its BCA of ba2, are aligned with the Government of Dominican Republic's Ba2 sovereign bond rating. This alignment reflects the strong financial and operational ties between the bank and the government, as well as Banreservas' significant role in the country's deposit and lending markets. Consequently, the bank's deposit ratings carry the same stable outlook as the Government of Dominican Republic. MACRO PROFILE OF DOMINICAN REPUBLIC CHANGED TO MODERATE, FROM MODERATE- The upgrade of the Dominican Republic's Macro Profile to Moderate, from Moderate-, reflects the country's sustained high economic growth in the past 15 years, which has significantly enhanced its scale, wealth, and economic diversification. This progress has been further supported by gradual enhancements in institutional strength and governance, resulting in a marked improvement in policy effectiveness and institutional quality. These advancements are evident in the strengthened legal frameworks for banking supervision, which have contributed to better risk management practices and more robust prudential regulations—particularly in areas such as provisioning, capital requirements, and related-party transactions. Additionally, the steady development and increasing sophistication of the financial system in recent years have fostered a more favorable operating environment for the banking sector. Between 2017 and March 2025, credit grew at an average of 1.3 times nominal GDP—equivalent to around 13% annually—yet the Dominican Republic continues to have one of the lowest financial intermediation rates in Latin America, with credit to GDP standing at approximately 31% in 2024. Asset quality remains low systemwide, averaging 1.0% between 2021 and March 2025, helped by the high growth levels, though nonperforming loans (NPLs) are gradually trending back toward pre-pandemic levels of 1.5% in 2019. While commercial lending that accounted for 58% of gross loans in March 2025 is broadly diversified, it includes significant exposures to sectors that are closely interconnected with the higher-risk tourism industry. The loan-to-deposit ratio in US dollars remains below 60%, which helps mitigate risks related to currency mismatches and potential dollar deposit withdrawals. The Dominican Republic's banking system is relatively concentrated, with the three largest banks accounting for 80% of total loans in March 2025, including Banreservas (31%), Popular (30%) and BHD (18%). As the largest bank, Banreservas holds significant market power, which may create competitive imbalances and raise funding costs for private institutions. Nonetheless, the system benefits from a stable core deposit base and ample liquidity buffers, providing strong financial flexibility. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The Ba2 deposit rating assigned to Banreservas is positioned at the same level of the sovereign bond rating, and therefore, upward rating pressures are limited at this point. The bank's rating could be upgraded if the Dominican Republic sovereign bond rating was upgraded, provided that the bank's financial profile remained sound. Factors that could lead to a BCA downgrade include: (1) a substantial and consistent deterioration in asset risk and profitability and/or (2) weakened capitalization, as a result of an acceleration of its loan origination. In addition, a downgrade of the DR's sovereign rating could lower Banreservas' supported ratings, as well as its ba2 BCA. The principal methodology used in these ratings was Banks published in November 2024. Banco de Reservas de la Republica Dominicana "Assigned BCA" score of ba2 is set four notches below the "Financial Profile" initial score of baa1 reflecting several structural challenges. These include the high correlation among economic sectors, which elevates asset risks; a rise in nonperforming and restructured loans in recent quarters; a modest capital base; a moderately concentrated deposit structure; and a heavy reliance on short-term funding, which limits its ability to expand into long-term lending. ============= J A M A I C A ============= JAMAICA: Raises $7.5 Billion Through Auction of Treasury Bills -------------------------------------------------------------- RJR News reports that the Ministry of Finance raised a $7.5 billion from investors through its latest auction of treasury bills, more than three times the $2.2 billion it initially sought. Investors snapped up $2 billion worth of the 91-day bill, $2.9 billion from the 182-day bill and $2.6 billion from the 273-day instrument, according to RJR News. The funds will help support the country's $1.26 trillion budget, the report notes. The average interest rate was 5.2% for the 91-day bill, 5.3% for the 182-day and 6% for the 273-day bill, the report relays. The government currently has about $10.3 billion in outstanding treasury bills, its main tool for short-term borrowing, 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. =========== M E X I C O =========== LEISURE INVESTMENTS: Seeks to Extend Plan Exclusivity to Oct. 27 ---------------------------------------------------------------- Leisure Investments Holdings LLC, and certain of its affiliates asked the U.S. Bankruptcy Court for the District of Delaware to extend their exclusivity periods to file a plan of reorganization and obtain acceptance thereof to October 27 and December 29, 2025, respectively. By this Motion, the Debtors request entry of the Proposed Order extending the Plan Periods and Solicitation Periods by approximately ninety 90 days, as follows: (i) for the Initial Debtors, through and including October 27 and December 29, 2025, respectively; (ii) for Controladora, through and including November 12, 2025 and January 12, 2026, respectively; and (iii) for Embassy, through and including December 1, 2025 and January 29, 2026, respectively, without prejudice to the Debtors' right to seek additional extensions of the Exclusive Periods. This Motion is the Debtors' first request to extend the Exclusive Periods. In the four months since the Commencement Date, the Debtors have addressed critical litigation, case management, and operational issues to maximize the value of the Debtors' estates and sell certain of the Debtors' assets. The complexity of the various issues addressed, and the time, effort, and planning required to obtain the progress made thus far warrant the requested extension of the Exclusive Periods. The Debtors claim that they have made significant and material progress in the Chapter 11 Cases. The progress achieved to date was the result of the extensive efforts of the Debtors, their management, and their professional advisors, in cooperation with various parties in interest in the Chapter 11 Cases, to protect and maximize the value of the Debtors' estates. Accordingly, the Debtors submit that this factor weighs in favor of extending the Exclusive Periods. The Debtors explain that they faced significant challenges in obtaining access to and control over their books and records. The Debtors and their professionals expended substantial time and effort in attempt to obtain such access, which has limited the Debtors' opportunity to formulate and negotiate a chapter 11 plan. Accordingly, the Debtors submit that this factor weighs in favor of extending the Exclusive Periods. The Debtors assert that they have endeavored to establish and maintain cooperative working relationships with their primary creditor constituencies. Importantly, the Debtors are not seeking the extension of the Exclusive Periods to delay administration of the Chapter 11 Cases or to exert pressure on their creditors, but rather to continue the orderly, efficient, and cost-effective chapter 11 process. Thus, this factor also weighs in favor of the requested extension of the Exclusive Periods. The Debtors further assert that termination of the Exclusive Periods would adversely impact the Debtors' efforts to preserve and maximize the value of the estates and the progress of the Chapter 11 Cases. If the Court were to deny the Debtors' request for an extension of the Exclusive Periods, any party in interest would be permitted to propose an alternative chapter 11 plan for the Debtors, which would only foster a chaotic environment and cause opportunistic parties to engage in counterproductive behavior in pursuit of alternatives that are neither value maximizing nor feasible under the circumstances of the Chapter 11 Cases. Counsel to the Debtors: Robert Brady, Esq. Sean T. Greecher, Esq. Allison S. Mielke, Esq. Jared W. Kochenash, Esq. Young Conaway Stargatt & Taylor LLP Rodney Square 100 North King Street Wilmington, DE 19801 Telephone: (302) 571-6600 Facsimile: (302) 571-1253 Email: rbrady@ycst.com sgreecher@ycst.com amielke@ycst.com jkochenash@ycst.com About Leisure Investments Holdings Leisure Investments Holdings LLC and affiliates are operating under the name "The Dolphin Company," manage over 30 attractions, including dolphin habitats, marinas, water parks, and adventure parks, located in eight countries across three continents. Their primary operations are based in Mexico, the United States, and the Caribbean, with locations in Jamaica, the Cayman Islands, the Dominican Republic, and St. Kitts. These attractions are home to approximately 2,400 animals from more than 80 species of marine life, including a variety of marine mammals such as dolphins, sea lions, manatees, and seals, as well as birds and reptiles. As of 2023, the marine mammal population at the Debtors' parks includes roughly 295 dolphins, 51 sea lions, 18 manatees, and 18 seals. Leisure Investments Holdings LLC sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case 25-10606) on March 31, 2025. In its petition, the Debtor reports estimated assets and liabilities between $100 million and $500 million each. Honorable Bankruptcy Judge Laurie Selber Silverstein handles the case. The Debtors tapped Robert S. Brady, Esq., Sean T. Greecher, Esq., Allison S. Mielke, Esq., and Jared W. Kochenash, Esq. as counsels. The Debtors' restructuring advisor is RIVERON MANAGEMENT SERVICES, LLC. The Debtors' Claims & Noticing Agent is KURTZMAN CARSON CONSULTANTS, LLC d/b/a VERITA GLOBAL. ===================== P U E R T O R I C O ===================== GRUPO HIMA: Court Amends Order on Nova Infusion Asset Sale ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Puerto Rico has approved CMT Development LLC and its affiliates, to sell Grupo Hima San Pablo Nova Infusion Asset, free and clear of liens, claims, and encumbrances. The Debtors have requested an order approving the sale of the Hima San Pablo Nova Infusion Assets relative to the sale of certain assets, including equipment, computers, furniture, machinery, vehicles, office furnishing, as well as intellectual property or proprietary rights related to the home infusion business known as Nova Infusion (Nova Infusion Assets). The Court has authorized the Debtors to sell the Assets to Eleva Recovery LLC as set forth in the Asset Purchase Agreement for Successful Bidder for the Nova Infusion Assets, free and clear of any all liens, claims and encumbrances. Notice of the Sale Motion, and the relief requested therein has been afforded to all interest parties and entities, including: (i) the Office of the United States Trustee; (ii) all entities, parties, or persons that, or that are known to, hold or have asserted any interests against or with respect to any of the Debtors or in, or against or with respect to any of the Assets ; (iii) all federal, state, and local regulatory or taxing authorities or recording offices which have a reasonably known interest in the relief requested through the Sale Motion; (iv) Civil Process Clerk, Bankruptcy Unit, Office of the U.S. Attorney for the District of Puerto Rico, Torre Chardón Suite 1201, 350 Carlos E. Chardón Street, San Juan, P.R. 00918; Attorney General of the United States, Department of Justice for the State of Washington, 950 Pennsylvania Avenue, NW, Washington D.C. 20530- 0001; Internal Revenue Service, P.O. Box 7346, Philadelphia, P.A. 19101-7346; Centro de Recaudación de Ingresos Municipales, Legal Division, Att. Carmen P. Figueroa, Esq., P.O. Box 195387, San Juan, P.R. 00919-5387, and via e-mail cfigueroa@crimpr.net and cpfbkcy@gmail.com; Department of Justice, Commonwealth of Puerto Rico, Att. Midga L. Rodríguez Collazo, Esq., P.O. Box 9020192, San Juan, P.R. 00902-0192, and via e-mail bankruptcyjusticia.gobierno.pr@gmail.com and mlrcbankruptcy@gmail.com; and Debtors' 20 largest unsecured creditors. As evidenced by the record of this case, such notice was good, sufficient and appropriate; Upon entry of the order approving the Sale Motion, Debtors shall have full corporate power and authority to consummate the Sale contemplated in the Sale Motion to Eleva Recovery LLC, subject to full compliance with the terms of the Sale Order. The approval of the Sale to Eleva Recover LLC through the Asset Purchase Agreement is considered to be deemed fair and reasonable and in the best interests of Debtors' estates; Pursuant to the Sale Motion, the liens, leases, mortgages, and/or encumbrances encumbering each of the Assets are to be completely, or caused to be cancelled pursuant to the provisions of Sections 363 and 1146 of the Bankruptcy Code and in accordance with the terms of the Sale Order. The transfer of the Assets to Eleva Recovery LLC will constitute a legal, valid, and effective transfer thereof, and shall vest Eleva Recovery LLC with all rights, title, and interest of Debtors and sellers in and to the Assets free and clear of all interests of any kind or nature whatsoever, whether known or unknown. Neither Eleva Recovery LLC nor its designees, successors, assigns or transferees, shall be obligated or liable, either directly or indirectly, as successor, transferee or otherwise, for any liabilities or interests of the Debtors, sellers, or any of theirs affiliates as a result of the Sale of the Assets including, without limitation, any retention agreements entered into by Debtors prepetition or post-petition or assumed post-petition by order of this Court or otherwise. Any monies held in escrow will be held for the benefit of CRIM for the first two years after the closing, including applicable extensions of said term. Nothing contained in any order pertaining to the sale of Debtor assets to Eleva Recovery, LLC, and no event or occurrence in connection therewith, shall conflict with or derogate the provisions of the Sale Order, or affect the Closing of the transactions contemplated herein. About CMT DEVELOPMENT Grupo HIMA San Pablo, Inc. serves as a diversified healthcare services holding company pursuant to a corporate reorganization of several businesses related by common ownership. Through its subsidiaries and affiliates, Grupo HIMA San Pablo primarily owns and operates hospital facilities and other healthcare related businesses. As of August 2023, the HIMA GROUP operates four hospitals, with over 1,200 licensed beds, including an Oncological Hospital, a multi-specialty physician practice management company, Home Care Service (including infusion therapies and wound care), a free-standing ambulatory center and a 16-ambulance service company. Grupo HIMA San Pablo and its affiliates filed Chapter 11 petitions (Bankr. D. P.R. Lead Case No. 23-02510) on Aug. 15, 2023. In the petition signed by its chief executive officer, Armando J. Rodriguez-Benitez, Grupo HIMA San Pablo disclosed $500 million to $1 billion in assets and $100 million to $500 million in liabilities. Judge Enrique S. Lamoutte Inclan oversees the cases. Wigberto Lugo Mender, Esq., at Lugo Mender Group, LLC and Pietrantoni Mendez & Alvarez, LLC serve as the Debtors' bankruptcy counsel and special counsel, respectively. The U.S. Trustee for Region 21 appointed an official committee of unsecured creditors on Sept. 7, 2023. Porzio, Bromberg & Newman, P.C. is the committee's legal counsel. 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