251009.mbx

251009.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, October 9, 2025, Vol. 26, No. 202 Headlines A R G E N T I N A ARGENTINA: Bessent Says U.S. 'Not Putting Money', Touts Swap ARGENTINA: Locals Fuel Bond Swings as Bessent Stokes Chaos GENERACION MEDITTERRANEA: Fitch Affirms 'RD' Issuer Default Ratings B R A Z I L BRAZIL: IDB OKs $50 Million Loan to Support Digital Transformation CEMIG: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable JBS SA: Returns to Paraguay with $70 Million Investment LOCALIZA RENT: Fitch Affirms 'BB+' LongTerm IDRs, Outlook Stable WALKER EDISON: Hires Gibson Dunn & Crutcher as Litigation Counsel C A Y M A N I S L A N D S OMNIYAT SUKUK 1: Fitch Rates USD400-Mil. Drawdown 'BB-' D O M I N I C A N R E P U B L I C [] DOMINICAN REPUBLIC: Abinader Points to Tourism as Job Generator P A N A M A CREDICORP BANK: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable P U E R T O R I C O CIUDAD DEPORTIVA: Case Summary & 12 Unsecured Creditors - - - - - ================= A R G E N T I N A ================= ARGENTINA: Bessent Says U.S. 'Not Putting Money', Touts Swap ------------------------------------------------------------ Nicolle Yapur & Ignacio Olivera Doll, Bloomberg News report that U.S. Treasury Secretary Scott Bessent reiterated support for Argentina, but later warned any aid wouldn't involve outright US investment, triggering steep swings in bond prices. The currency market was more stable, largely because Javier Milei's government sold dollars for a third straight day to defend the peso, according to Bloomberg News. Bessent said on X that the United States would do "what is necessary" to help Argentina, triggering a surge in the bonds, Bloomberg News relays. A little later, he told CNBC that this didn't mean putting money into the country, a caveat that sent the notes back down again, Bloomberg News notes. Later still, a report Milei's top deputies were heading to Washington for talks sent the notes back up, Bloomberg News discloses. Bloomberg News says that the US had previously outlined at least three possible options to help the crisis-prone South American nation, including a US$20-billion swap line, the repurchase of Argentine debt and direct currency purchases. Bessent's latest comments seem to have narrowed it down. "We're giving them a swap line, we're not putting money into Argentina," he said in the CNBC interview. Economy Minister Luis Caputo and Central Bank Governor Santiago Bausili are scheduled to arrive in the US to discuss the swap line, according to local media, Bloomberg News relays. Argentine dollar bonds due in 2035 recovered in afternoon trading, climbing more than a cent on the dollar – the first advance in six days, Bloomberg News discloses. The peso was steady after the government intervened again, closing session at 1,424.5 to the dollar, Bloomberg News relays. The upper limit of a trading band agreed with the International Monetary Fund is currently at 1,481.7, Bloomberg News notes. Milei's government has had to deploy millions of dollars and reintroduce some exchange controls to fend off further depreciation of the peso over the past week, Bloomberg News relays. It sold greenbacks again, according to people familiar with the matter, Bloomberg News discloses. It unloaded around US$180 million, according to one of the people, bringing net sales to about US$650 million, Bloomberg News relays. IMF spokesperson Julie Kozack reiterated the Washington-based lender's backing of Argentina during a press briefing. But she also stressed the need to build "broad political support" for Milei's reform agenda and for the country to rebuild its foreign reserves, Bloomberg News notes. Earlier, dollar notes had fallen from session highs "as investors digested clarifications" that the US aid represents "a swap line rather than a new injection of dollar liquidity," Walter Stoeppelwerth, chief investment officer at local brokerage Grit Capital Group, said in a report to investors, Bloomberg News relays. The drop in the currency has been driven in part by concerns over Milei's faltering political support, Bloomberg News discloses. His party is hoping to increase its representation in Congress in national midterm elections this month, having suffered a crushing defeat in a local vote in Buenos Aires Province in early September, Bloomberg News relays. Bessent's announcement of a lifeline sparked major rallies in both the peso and dollar bonds. But the excitement was short lived, as the currency saw renewed pressure from rising dollar demand and as investors grew skeptical around the timing and form of US help, Bloomberg News notes. "The political backdrop is still central to the case," Stoeppelwerth said. "Risks remain that the administration could overreact in defense of the exchange rate band, even dipping into IMF resources, or that Milei's polarising leadership style could erode middle-class support and weaken governability," Bloomberg News added. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. ARGENTINA: Locals Fuel Bond Swings as Bessent Stokes Chaos ---------------------------------------------------------- Nicolle Yapur & Ignacio Olivera Doll at Bloomberg News report that Argentine bonds have swung on every headline that has peppered trading screens over the past weeks in a frenzy of volatility. Some investors see local traders behind many of the moves as foreigners hold tight, according to Bloomberg News. The country's dollar notes, which saw their biggest rally in three years, came close to erasing all the advance in the next few days before rebounding once again, Bloomberg News relays. The driver was always the same: news on possible US aid for the administration of President Javier Milei, Bloomberg News discloses. No day was the roller coaster more evident than, when the bonds jumped after US Treasury Secretary Scott Bessent reiterated his pledge to help Argentina, then fell as he clarified that the aid didn't involve fresh cash for the country, Bloomberg News relays. The debt flipped again in afternoon trading on news that Economy Minister Luis Caputo and Central Bank Governor Santiago Bausili would travel to Washington to discuss a US$20-billion swap line, Bloomberg News discloses. Locals saw their share of ownership of dollar bonds more than triple after a market crash in August 2019 that was triggered by a landslide election loss for former business-friendly president Mauricio Macri, confirming investor fears of a return of leftist politics, Bloomberg News relays. His successor, Alberto Fernández, began a debt restructuring process the following year, Bloomberg News discloses. Resident holders owned 31 percent of New York law debt by June 2025, compared to just 8.6 percent in September 2020, according to data compiled by brokerage PPI Argentina, Bloomberg News notes. "The volatility is associated with the domestic holder story," said Jared Lou, a portfolio manager at William Blair in New York. "Foreigners got burned, careers were destroyed during Macri." Peso Crisis Bloomberg News relays that volatility soared in the past few weeks as Argentina slipped back toward a currency crisis. A slump in the peso, toward the limit of its trading band, led the government to sell what traders estimate as about US$650 million in the spot market and restore some exchange controls to rein in dollar demand, Bloomberg News discloses. The peso still shed over seven percent in the last five sessions, closing flat, while the government hasn't disclosed any official intervention figures, Bloomberg News relays. Bloomberg News discloses that that drop comes as traders grow increasingly sceptical of Milei's political capital ahead of midterm elections on October 26, particularly after suffering an unexpectedly large defeat in regional elections in Buenos Aires Province in September. A drop in support in Congress could stall the libertarians overhaul of Argentina's economy, Bloomberg News relays. But while local investors may be using this to step out of the bond market, some international firms are making bold calls to buy the dip, Bloomberg News notes. Following a visit to Buenos Aires, Citigroup strategists led by Donato Guarino wrote in a report that current bond valuations offered an "interesting entry point," though volatility is set to remain, Bloomberg News discloses. David Austerweil, emerging-markets deputy portfolio manager at VanEck in New York, went overweight on Argentina after bonds crashed following Milei's defeat in Buenos Aires Province, Bloomberg News discloses. Although he notes the price action hasn't been positive recently, he's confident that US Treasury aid is going to secure bond payments, at least for the shorter end of the curve, Bloomberg News notes. "We think this is good entry point," he said. "Assuming not a total disaster in the midterms." Bloomberg News relays that not all foreign investors have been adding. Some funds were heavily overweight heading into the Buenos Aires Province election and are now being forced to cut their positions, Austerweil said. Now, both local and foreign creditors are focusing on the future of the exchange rate policy, especially as Milei is expected to prioritise currency stability over reserve accumulation ahead of the midterms, Bloomberg News discloses. The government only captured a fraction of a temporary surge in dollar supply driven by a tax break for farm exports that ended, letting the rest be gobbled up by Argentines who access the official market and then turn to sell at the higher parallel rate, Bloomberg News notes. Foreign investors see a scenario of FX rate unification as positive, said Walter Stoeppelwerth, chief investment officer at local brokerage Grit Capital Group, Bloomberg News relays. "The biggest risk everyone sees is that the economic team will squander the few dollars they have" before the elections on October 26, he said. "All of this is part of the superstition surrounding elections. The original sin for a government party is to allow a devaluation that results in inflation," he added. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a 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. GENERACION MEDITTERRANEA: Fitch Affirms 'RD' Issuer Default Ratings ------------------------------------------------------------------- Fitch Ratings has affirmed Generacion Mediterranea S.A.'s (GEMSA) Long-Term Local and Foreign Currency Issuer Default Ratings (IDRs) at 'Restricted Default' (RD)'. Fitch has also affirmed GEMSA's senior secured and unsecured notes co-issued with Central Termica Roca S.A. at 'C', as Fitch expects average recovery prospects. The ratings affirmation reflects GEMSA's ongoing missed service payments on several secured and unsecured notes during 2025. The 'RD' rating indicates an issuer that has experienced an uncured payment default but has not entered bankruptcy filings or ceased operating. Fitch will continue to monitor the company's debt restructuring process and will reassess GEMSA's ratings, reflecting the new capital structure and its underlying business risk. Key Rating Drivers Ongoing Debt Restructuring: GEMSA is preparing to restructure its secured and unsecured notes totaling approximately USD917 million. In August, the company reached a consent solicitation for approximately USD400 million related to its project-finance debt, including extending maturities by 18-36 months and coupon step-ups. As of June 2025, GEMSA's total outstanding debt was approximately USD1.5 billion RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - The IDR could be downgraded to 'D' if the company initiates bankruptcy filings or other formal insolvency procedures. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Fitch will reassess the IDRs upon the completion of a debt restructuring process; the updated IDRs would reflect the new capital structure and credit profile of the issuer. Liquidity and Debt Structure GEMSA is currently in talks with creditors to reorganize their approximately USD950 million in financial obligations. As of June 30, 2025, about USD1.49 billion in debt is classified as current. Issuer Profile Generacion Mediterranea S.A. is a holding company for most of Grupo Albanesi's electricity generation assets. Operating in the sector since 2004, Albanesi owns or participates in five generation companies: Generacion Mediterranea S.A., Central Termica Roca S.A., GM Operaciones S.A., Generacion Litoral S.A., and Solalban Energia S.A. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor 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 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 ----------- ------ ----- Generacion Mediterranea S.A. LT IDR RD Affirmed RD LC LT IDR RD Affirmed RD senior unsecured LT C Affirmed C senior secured LT C Affirmed C Central Termica Roca S.A. senior unsecured LT C Affirmed C senior secured LT C Affirmed C =========== B R A Z I L =========== BRAZIL: IDB OKs $50 Million Loan to Support Digital Transformation ------------------------------------------------------------------ The Inter-American Development Bank (IDB) approved a $50 million loan to support digital transformation in the state of Piauí through the "Piauí Mais Digital" project. The operation aims to expand digital connectivity, increase the supply and use of digital public services, improve public management through digitization, and enhance the digital capabilities of businesses. The project will finance the expansion of the state's data transmission network and modernization of its data center infrastructure, as well as initiatives to strengthen risk management and cybersecurity incident response. Public employees' digital skills will also be strengthened through a certification program in artificial intelligence to ensure optimal use of digitized and automated public services. The project also focuses on inclusion, ensuring that corporate systems and digital platforms are accessible to people with disabilities and that digital solutions are implemented to serve vulnerable populations. Additionally, internet access points will be provided in 13 quilombola communities, and a digital literacy program will be developed for populations in these territories. One component will be dedicated to the digital economy, helping to increase the digital capabilities of local businesses through technical assistance to promote digital technologies in priority sectors and a talent development program for women and more vulnerable populations. The program will also support the strengthening of the institutional capacity of the Secretariat of Artificial Intelligence, Digital Economy, Science, Technology, and Innovation—the first secretariat in Brazil with a mandate for artificial intelligence topics. The expansion of connectivity is expected to directly benefit about 755,000 residents of the 99 municipalities served, and more than 200 companies should be reached by programs related to the digital economy, according to estimates. The project aims to increase the number of public services available online and raise public satisfaction with these services. The digitization process will generate more than R$ 130 million in savings for society and the state's public coffers. This is the 11th operation approved by the IDB Executive Board as part of the Conditional Credit Line for Investment Projects (CCLIP) Brasil Mais Digital, from 2021. The IDB loan for Piauí has a repayment term of 24.5 years, a grace period of 6 years, and an interest rate based on SOFR. The local government's co-financing is $12.5 million. 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. CEMIG: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable ------------------------------------------------------ Fitch Ratings has affirmed Local Currency (LC) and Foreign Currency (FC) Issuer Default Ratings (IDRs) for Companhia Energetica de Minas Gerais' (Cemig) and its subsidiaries Cemig Distribuicao S.A.'s (Cemig D) and Cemig Geracao e Transmissao S.A.'s (Cemig GT) at 'BB'. Fitch has also affirmed the National Scale Ratings for these three entities at 'AAA(bra)'. The Rating Outlook is Stable. Ratings for the Cemig group reflect its diversified asset base, healthy financial profile and favorable operating performance in the Brazilian power sector. Fitch expects the group's ambitious capex program to drive negative FCF throughout the rating horizon and to increase leverage, which should remain aligned with the rating level. The group's leverage is projected to peak in 2027, as it has proven access to funding to support its capex and refinancing needs. Fitch equalizes the IDRs of Cemig and its subsidiaries, which it has strong legal incentives to support. Key Rating Drivers Robust Business Profile: The Cemig group's IDRs are supported by a diversified and resilient asset base and operation across different segments in the power sector, which mitigates business and regulatory risks. The group is one of Brazil's largest integrated electric utilities, distributing electricity to 9.4 million users and operating 4.5GW of generation installed capacity and 5,060km of transmission lines. Cemig's distribution segment should represent about 56% of consolidated EBITDA in 2025, with generation and transmission roughly at 31% and natural gas distribution at about 13%. Positive Performance in Distribution: Cemig D has sustained its strong operating performance despite lower distributed energy volumes driven by rapid growth in distributed generation in Minas Gerais. Fitch's base case incorporates a modest recovery in sales volumes, flat in 2025 and about 1.4% in 2026-2028. EBITDA is projected at BRL3.9 billion in 2025 and BRL4.2 billion in 2026, above regulatory levels. Favorable Generation and Transmission: Cemig GT's performance and highly predictable revenue support Cemig's consolidated credit profile. In generation, Cemig GT is fully contracted through 2027 at an average price of BRL233/MWh, while transmission revenue is linked to asset availability rather transported volumes. Fitch projects an average annual EBITDA of around BRL2.3 billion in 2025-2027. Fitch's base case also factors in the expiration of three generation concessions in 2027, representing 54% of Cemig GT's commercial capacity, with the full cash flow impact reflected in 2028. Leverage to Increase: Cemig's consolidated adjusted gross and net leverage are expected to rise moderately over the next three years, peaking at 3.5x and 3.3x in 2027, respectively, driven by its robust capex program partially financed with debt. Despite this increase, Fitch anticipates leverage will remain consistent with the IDR's 'BB' rating, supported by the conservative leverage levels of 2.3x (gross) and 2.0x (net) for the LTM ended in June 2025. Fitch forecasts adjusted net leverage to increase to 2.5x in 2025, 3.0x in 2026, and 3.3x in 2027, returning to 3.0x and below starting in 2028. Capex Plan to Pressure FCF: Fitch expects Cemig to remain consistently FCF negative over 2025-2028 as it executes an aggressive capex program totaling BRL25.1 billion, including BRL5.6 billion in 2025. Capex is primarily concentrated at Cemig D to strengthen the asset base and will be incorporated into the next tariff review in 2028. Fitch estimates consolidated negative FCF of about BRL4.2 billion in 2025 and BRL5.3 billion in 2026, assuming dividend distributions of 50% of net income. Consolidated EBITDA is forecasted at around BRL7.0 billion in 2025 and 2026, with cash flow from operations (CFO) approximately of BRL3.4 billion, pressured by higher interest rates in Brazil. Ratings Equalization: Under Fitch's Parent and Subsidiary Linkage Rating Criteria, Fitch equalizes the ratings of Cemig, Cemig D, and Cemig GT. This reflects the holding company's strong legal and strategic incentive to support the subsidiaries in a stress scenario, including Cemig's consolidation of the subsidiaries, guarantees on a significant portion of their debt, and cross-default provisions across most debt instruments. Debt financial covenants are measured on a consolidated basis, with centralized strategy and cash management. Fitch also views the subsidiaries as core to Cemig's business profile. Controller Does Not Constrain Ratings: Cemig is assessed on a standalone basis relative to its controlling shareholder, the state of Minas Gerais. The rating does not incorporate a potential federalization of the company, which remains under discussion by the controller and the Federal Government, nor a privatization. While completion is not expected in the near term, any developments will be assessed when and if they are announced. Peer Analysis Compared with Brazilian peers in the power sector, Cemig's Local Currency IDR is weaker than that of CPFL Energia S.A. (CPFL Energia; BBB/Stable), Engie Brasil Energia S.A. (Engie Brasil; BBB-/Stable) and Transmissora Alianca de Energia Eletrica S.A. (Taesa; BB+/Stable). Cemig faces higher business risk due to the concentration of its distribution segment within one concession area and the typically weaker operational performances of state-owned companies. CPFL Energia's IDRs benefit from its controller's moderate strategic and operational incentives to support it. The company's IDRs are based on a combination of its Standalone Credit Profile plus a two-notch uplift. The group has a robust business profile with significant, diversified, and profitable operations in the energy distribution, generation, and transmission segments and a healthy financial profile. Taesa operates in the highly predictable transmission segment, with 14,400km of transmission lines across the country, compared to Cemig's 5,060km. Engie Brasil is the second-largest player in the generation segment, with an installed capacity of 10.6GW, compared with Cemig's 4.5GW. Additionally, Cemig's financial profile presents more negative FCF and expected higher leverage than these two peers. Key Assumptions - Cemig D's energy distribution volume flat in its concession area in 2025 and average annual growth of 1.4% from 2026 to 2028; - Cemig D's non-manageable costs fully passed through tariffs; - Cemig GT's average sales price of BRL226 per MWh from 2025 to 2026, with annual energy sales of 5.1GWh per year; - Concession expiration of Hydro Plants Sa Carvalho, Emborcacao, and Nova Ponte in August 2026, May 2027 and August 2027, respectively; - Average annual consolidated capex of BRL6.3 billion from 2025 to 2028; - Dividend payout of 50% of net income. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade: - Consolidated net adjusted leverage higher than 4.0x on a sustainable basis; - EBITDA-interest coverage below 3.0x on a sustainable basis; - Short-term debt exceeding cash; - Significant operational issues in its main subsidiaries, CEMIG D and CEMIG GT; - Loss or costly renewal of generation concessions, depending on the financial structure. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade: - Neutral to positive FCF; - Consolidated net adjusted leverage below 3.0x on a sustainable basis; - EBITDA interest coverage above 4.5x on a sustainable basis. Liquidity and Debt Structure Cemig Group is expected to retain broad access to funding, mitigating the anticipated maintenance of a modest to moderate cash position throughout the investment cycle through 2028. This year, the group successfully extended its debt maturity profile, lengthening the average tenor to 6.0 years in June 2025 from 3.4 years in June 2024, with BRL3.1 billion coming due by 2026. As of June 30, 2025, consolidated cash and equivalents totaled BRL3.0 billion compared with short-term debt of BRL2.7 billion. Total adjusted debt was BRL18.5 billion, comprising BRL15.2 billion in debentures and BRL3.3 billion in off-balance-sheet debt obligations. Issuer Profile Controlled by the state of Minas Gerais, Cemig holds one of the largest integrated power utility groups in Brazil. Cemig D operates in the distribution segment, Cemig GT primarily operates in generation and transmission, and Gasmig operates in natural gas distribution. Summary of Financial Adjustments Revenues and EBITDA do not incorporate construction revenues and construction costs. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor 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 Companhia Energetica de Minas Gerais (CEMIG) has an ESG Relevance Score of '4' for Governance Structure due to the inherent governance risks that arise with a dominant state shareholder, 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 Prior ----------- ------ ----- Cemig Geracao e Transmissao S.A. LT IDR BB Affirmed BB LC LT IDR BB Affirmed BB Natl LT AAA(bra)Affirmed AAA(bra) senior unsecured Natl LT AAA(bra)Affirmed AAA(bra) Cemig Distribuicao S.A. LT IDR BB Affirmed BB LC LT IDR BB Affirmed BB Natl LT AAA(bra)Affirmed AAA(bra) senior unsecured Natl LT AAA(bra)Affirmed AAA(bra) Companhia Energetica de Minas Gerais (CEMIG) LT IDR BB Affirmed BB LC LT IDR BB Affirmed BB Natl LT AAA(bra)Affirmed AAA(bra) JBS SA: Returns to Paraguay with $70 Million Investment ------------------------------------------------------- Roberto Samora at Reuters that Brazilian meatpacker JBS disclosed investments of $70 million in Paraguay over the next two years, including the acquisition of a chicken processing plant, according to a statement. The acquisition of Paraguayan chicken brand Pollos Amanecer, which owns a poultry plant in the Doctor Juan Eulogio Estigarribia district, from firm Campo 9 represents the first phase of JBS's new investment cycle in Paraguay, the statement noted, according to Reuters. The move, announced during the visit of Paraguayan President Santiago Pena to a plant of JBS in Brazil, marks JBS's return to Paraguay after the company sold cattle slaughterhouses in 2017 to Brazilian rival Minerva, Reuters relays. "We are confident that this operation will be a growth engine for the country," said JBS Chief Executive Officer Gilberto Tomazoni in a statement, adding the move would also accelerate "Paraguay's presence in the global chicken market." "Paraguay offers good conditions for the development of poultry farming, and this investment reinforces our strategy of increasing the company's competitiveness and diversification," the CEO said, the report discloses. After expansion and modernization works, the plant will reach a processing capacity of 100,000 birds per day, said JBS, noting the goal is to keep supplying the domestic market and also kick off exports from the unit, the report notes. The production complex currently has 19 poultry sheds, and the plan is to reach a total of 139 when the expansion is completed, the company said, the report says. The complex will include 28 farms for genetic material, hatcheries, and a feed mill, according to JBS, the report adds. About JBS SA JBS S.A. is a Brazilian company that is a large meat processing enterprise, producing factory processed beef, chicken, salmon, pork, and also selling by-products from the processing of these meats. It is headquartered in Sao Paulo. It was founded in 1953 in Anapolis, Goias. As reported in the Troubled Company Reporter-Latin America in August 2021, S&P Global Ratings revised the global scale outlook on JBS S.A. (JBS) and its fully owned subsidiary JBS USA Lux S.A. (JBS USA) to positive from stable and affirmed its 'BB+' issuer credit rating. The recovery expectations remain unchanged, and S&P affirmed the 'BB+' ratings on the senior unsecured notes and the 'BBB' ratings on the secured term loans. LOCALIZA RENT: Fitch Affirms 'BB+' LongTerm IDRs, Outlook Stable ---------------------------------------------------------------- Fitch Ratings has affirmed Localiza Rent a Car S.A.'s (Localiza) Long-Term Local Currency (LC) and Foreign Currency (FC) Issuer Default Ratings (IDRs) at 'BB+'. Fitch has also affirmed Localiza's and its wholly owned subsidiary Localiza Fleet S.A.'s (Localiza Fleet) Long-Term National Scale Rating at 'AAA(bra)' and their senior unsecured debt instruments at 'AAA(bra)'. The Rating Outlook for the corporate ratings is Stable. Localiza's ratings reflect its consistent leadership in the Brazilian car and fleet rental industry, with large scale and resilient operational performance throughout economic cycles. Localiza benefits from a diversified client base and long-term contracts for a significant part of its revenues. The analysis reflects Localiza's moderate financial leverage, access to unsecured financing, strong liquidity, and a well spread debt amortization schedule. Fitch assigns equal ratings to Localiza and Localiza Fleet reflecting the parent's incentives to support the subsidiary. Key Rating Drivers Solid Leading Market Position: Localiza's large scale, proven operating expertise, national footprint, and strong used car sale operations provides competitive advantage on assets purchase and lower operating costs relative to peers and supports its prominent business position within the car and fleet rental industry in Brazil. As of June 2025, Localiza's total fleet of 632,957 vehicles, consisting of 329,259 in rent-a-car (RaC) and 303,698 in fleet management (GTF), secured a comfortable leadership in both markets. Fitch forecasts Localiza's owned total fleet will remain stable at around 633, 000 vehicles in 2025 and 636, 000 vehicles in 2026. Adequate Operating Performance: Fitch expects consolidated EBITDA to be stable and gradually improve, driven mainly by Localiza's ability to adjust rates and maintain adequate margins. Fitch forecasts net revenue of around BRL41 billion and EBITDA of BRL12 billion in 2025 and BRL44 billion and BRL13 billion in 2026, compared to BRL37 billion and BRL12 billion in 2024. The rating assumes balanced demand and supply dynamics, increasing rental rates, and a marginally improving used car sales market, which should enable a gradual recovery on invested capital (ROIC) spread over the next three years, although still below 2022 levels. Prolonged high interest rates may delay spread normalization. Moderate Leverage: Fitch expects consolidated net leverage (IFRS 16 adjusted), measured as net debt/EBITDA, to be around 2.5x in 2025-2027, compared with the average of 3.0x for 2021-2024 and 2.6x for the LTM ended June 2025. Negative FCF and prolonged high interest rates could hinder Localiza's ability to deleverage. Negative FCF: The capital-intensive nature of the rental industry, which demands sizable and regular investments to grow and renew the fleet, strains Localiza's cash flow. In 2025, FCF should be temporarily positive at around BRL1 billion as the company slows fleet purchases, reflecting a capex of BRL24 billion, lower than the average BRL27 billion in 2023-2024. FCF should turn negative from 2026 onward, on average at BRL2 billion, pressured by annual average total capex between BRL30 billion and BRL35 billion, partly funded by used vehicle sales. Cash flow from operations (CFO) should be BRL7.3 billion and BRL7.9 billion in 2025 and 2026, respectively, pressured by rising interest payments. Parent and Subsidiary Linkage: Localiza Fleet's ratings reflect Localiza's high legal, strategic and operational incentives to support the subsidiary. Fitch's Parent and Subsidiary Rating Linkage Criteria equalizes the ratings of both companies. Localiza guarantees 100% of Localiza Fleet's debt. The subsidiary also operates under a shared brand and forms a unified vehicle rental ecosystem, benefiting from greater bargaining power when buying and selling vehicles, and negotiating with customers. Peer Analysis Compared with Localiza, Simpar S.A. (Simpar; BB-/Stable) has a smaller scale in car and fleet rental businesses, as well as a weaker financial profile with higher leverage and more pressured FCF. Positively, Simpar presents a more diversified business portfolio through operations in logistics and rental of heavy vehicles and machinery. Compared with Unidas Locacoes E Servicos S.A. (Unidas; BB-/Stable), Localiza has a much stronger business profile, higher liquidity, better access to credit market and lower leverage. Key Assumptions - Total fleet to reduce 5.0% in 2025 and increase by 0.4% in 2026; - Average ticket for RaC increasing 8.7% in 2025 and 4.0% in 2026; - Average ticket for GTF increasing 6.7% in 2025 and 5.5% in 2026; - Average capex around BRL26.7 billion in 2025-2026; - Dividend pay-out around 70% throughout the rating horizon. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Failure to preserve liquidity and inability to access adequate debt funding; - Failure to preserve a debt structure consisting overwhelmingly of unsecured debt; - Prolonged decline in demand coupled with company inability to adjust operation, leading to a higher-than-expected decline in operating cash flow; - Increase in total leverage to more than 4.5x and in net leverage to more than 3.5x on a regular basis; - A negative movement on Brazil's Country Ceiling could result in negative rating action for Localiza's FC IDR. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - An upgrade of Localiza's LC IDR and FC IDR would result from an improvement in Brazil's LC Rating and Country Ceiling or if its net debt-to-EBITDA ratio consistently moves toward 2.0x; - Upgrade not applicable to the National Scale ratings. The rating is being withdrawn. Liquidity and Debt Structure Localiza's robust liquidity position, ample access to different sources of funding, and track record of a proactive liability management are key credit considerations, with cash covering its short-term debt by an average over 2.0x during the last four years. The group's expected negative FCF should be financed with a combination of cash and additional debt in the rating scenario. As of June 2025, Localiza had BRL8.2 billion of cash and equivalents and BRL41 billion of total debt, with BRL3.8 billion due in the short term and BRL3.0 billion in 2H26. The group's consolidated debt is mainly comprised of BRL32.2 billion in debentures and BRL10 billion of bank loans. Localiza's financial flexibility is also supported by the group's ability to postpone growth capex to adjust to the economic cycle and the groups considerable number of unencumbered assets, with the market value of the fleet over net debt at around 1.5x. Issuer Profile Localiza is the largest car and fleet rental company in Brazil in terms of fleet size and revenue, operating in the RaC, fleet rental and used car sale segments. Its reference shareholders own 17.04% of the company, with 80.32% free float. Summary of Financial Adjustments - Rental 's interest expenses and amortization are considered operational and impact EBITDA; - Net derivatives impact debt; - Proceeds from sale of decommissioned cars is considered non-operational cash flow, before FCF; - Acquisition of vehicles is considered capex. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor 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 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 ----------- ------ ----- Localiza Fleet S.A. Natl LT AAA(bra) Affirmed AAA(bra) senior unsecured Natl LT AAA(bra) Affirmed AAA(bra) Localiza Rent a Car S.A. LT IDR BB+ Affirmed BB+ LC LT IDR BB+ Affirmed BB+ Natl LT AAA(bra) Affirmed AAA(bra) senior unsecured Natl LT AAA(bra) Affirmed AAA(bra) WALKER EDISON: Hires Gibson Dunn & Crutcher as Litigation Counsel ----------------------------------------------------------------- Walker Edison Holdco LLC seeks approval from the U.S. Bankruptcy Court for the District of Delaware to hire Gibson, Dunn & Crutcher LLP as special litigation counsel. The firm will represent the Debtors in that certain litigation originally styled as Walker Edison Furniture Company, LLC v. Brad Bonham, et al., Civil No. 230902160, in the Third Judicial District Court for the County of Salt Lake, State of Utah and represent the Debtors, as needed, in that certain litigation originally styled as Blue Owl Capital Corporation v. Brad Bonham, et al. Gibson Dunn's current hourly rates are: Partners $1,840 to $3,050+ Associate Attorneys and Of Counsel $905 to $1,725+ Paralegals $350 to $800 Other Timekeepers $370 to $695 Michael Farhang, Esq., a partner at Gibson, Dunn & Crutcher, assured the court that his firm is a "disinterested person" within the meaning of 11 U.S.C. 101(14). The firm can be reached through: Michael Farhang, Esq. Gibson, Dunn & Crutcher LLP 333 South Grand Avenue Los Angeles, CA 90071 Direct: (213) 229-7005 Fax: (213) 229-6005 Email: MFarhang@gibsondunn.com About Walker Edison Holdco Walker Edison, a Delaware corporation headquartered in West Jordan, Utah, designs and distributes affordable, ready-to-assemble home furnishings, operating primarily through e-commerce channels rather than traditional retail stores. Its business is managed by Walker Edison Intermediate, LLC and Walker Edison Holdco, LLC, and it owns EW Furniture, LLC, a Utah-based subsidiary. The company sources most products from suppliers in Asia and Brazil, distributing them through its Ohio and California centers or directly via major e-commerce platforms including Wayfair, Amazon, Walmart, Target, and Home Depot, with gross sales of roughly $124.6 million in 2024. Walker Edison Holdco, LLC and three affiliates filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 25-11602) on August 28, 2025. At the time of the filing, Walker Edison Holdco listed up to $50,000 in assets and between $100 million and $500 million in liabilities. Judge Thomas M. Horan oversees the cases. The Debtors tapped Morris, Nichols, Arsht & Tunnell, LLP as legal counsel; Lincoln International, LLC as investment banker; MACCO Restructuring Group, LLC as transformation advisor. Epiq Corporate Restructuring, LLC is the Debtors' notice, claims and administrative agent. =========================== C A Y M A N I S L A N D S =========================== OMNIYAT SUKUK 1: Fitch Rates USD400-Mil. Drawdown 'BB-' ------------------------------------------------------- Fitch Ratings has assigned Omniyat Holdings Ltd's (BB-/Stable) a rating of 'BB-' to the recent drawdown of USD400 million 7.25% maturing in March 2029 with a Recovery Rating of 'RR4'. Omniyat Sukuk 1 Limited is the trustee and has been incorporated solely for the purpose of issuing the certificates. BNY Mellon Corporate Trustee Services Limited is acting as delegate of the trustee. Omniyat is the obligor, seller, lessee and service agent. The programme allows for the issuance of trust certificates in an aggregate face amount of up to USD2 billion (or equivalent). The proceeds are being used for general corporate purposes and the acquisition of additional land bank. Key Rating Drivers The debt rating is in line with Omniyat's Long-Term Issuer Default Rating (IDR) and senior unsecured rating of 'BB-'. This reflects Fitch's view that a default of these senior unsecured obligations would reflect a default of Omniyat, in accordance with the agency's rating definitions. Fitch has given no consideration to any underlying assets or collateral provided, as the agency believes that the trustee's ability to satisfy payments due on the certificates will ultimately depend on Omniyat meeting its unsecured payment obligations to the trustee under the transaction documents described in the base offering circular and other supplementary documents. Fitch considers Omniyat contractually required to ensure the full and timely repayment of Omniyat Sukuk 1 Limited's obligations, in addition to its propensity to ensure repayment of the trust certificates. This is due to its various roles and obligations under the sukuk structure and documentation, especially but not limited to the following features: - On any dissolution or default event, and following the receipt of a dissolution notice, the certificates of the relevant series are immediately due and payable at the dissolution distribution amount. The trustee will have the right under the purchase undertaking to require the obligor to purchase and accept the transfer on the dissolution event date of all the trustee's rights, title, interests, benefits and entitlements in, to and under the lease assets at the exercise price. - The exercise price payable by Omniyat under the purchase undertaking to the trustee, together with the aggregate amount of the deferred sale price then outstanding, if any, are intended to fund the dissolution amount payable by the trustee under the trust certificates. The dissolution amount should equal the sum of the outstanding face amount of the trust certificate; any due and unpaid periodic distribution amounts for those certificates, or any other amount specified in the applicable pricing supplement. - The rental due on a rental payment date and the murabaha profit instalment will be sufficient to fund the periodic distribution amounts payable by the trustee in respect of the relevant certificates. - The lessor shall agree that the lessee may sub-lease the lease asset to any third party, provided that: any such sub-lease does not in any way affect, impair or reduce the obligations of the lessee; and any use of the lease assets under that sub-lease does not and will not contravene the principles of shari'a. If the lessee failed to comply, this would constitute a dissolution event. - The lessee (Omniyat) shall permit the lessor and any person authorised by the lessor at all reasonable times to inspect and examine the condition of the lease assets of each series. If the lessee failed to comply, it would constitute a dissolution event. - In addition, if the lessee failed to maintain the lease assets in suitable condition (other than fair wear and tear), the lessor shall be entitled, but not obliged, to take possession of the lease assets and carry out all necessary remedial actions (at the cost and expense of the lessee) to ensure the lease assets are in suitable condition for their current or intended use. - In a loss event (unless the lease assets are replaced), if there is a shortfall from the insurance proceeds, the servicing agent (Omniyat) must pay the loss shortfall amount directly into the transaction account. If the servicing agent fails to comply with the obligation to insure the assets against total loss or partial loss events, it must immediately notify the trustee and the delegate in writing, with the details of non-compliance; this would constitute a dissolution event. - Omniyat shall irrevocably and unconditionally authorise the trustee to, as soon as is practicable, register the lease assets in the name of the trustee or its nominee, agent, delegate or assignee at the Dubai Land Department, if Omniyat has failed to purchase the lease assets and as a result has failed to pay the exercise price, and the trustee is unable to make a claim under the indemnity. This is provided it is possible to register the lease assets under all applicable laws and a total loss event has not occurred and is continuing. - Fitch does not believe this clause is sufficient for it to treat the debt as secured or higher ranking than existing indebtedness, due to uncertainties and complexities related to the legal framework and regulations, Omniyat's willingness and ability to register the lease assets, and the lack of precedents. Its assessment of the effect of future asset-registration clauses will be case by case, and Fitch is monitoring developments in this evolving area. - Fitch could reassess the above assumptions regarding Omniyat's ratings and debt ranking, if warranted by developments. - Omniyat's payment obligations under the transaction documents are direct, unconditional, unsubordinated, and unsecured. Subject to certain negative pledge conditions, they rank at all times at least pari passu with all present and future unsecured and unsubordinated obligations of Omniyat from time to time outstanding. The pari passu ranking does not require Omniyat to make equal or rateable payments on its other unsecured obligations at the same time as, or as a condition of, paying sums due under the transaction documents and vice versa. - The sukuk documentation will include an obligation on Omniyat to ensure that at all times the tangible asset ratio defined as the aggregate value of the lease assets/aggregate value of the lease assets and the deferred sale price outstanding is more than 50%. Failure by Omniyat to comply with this obligation will not constitute an obligor event. If the tangible asset ratio falls below 33% (tangibility event), the certificate holders will have the option to require the redemption of all or any of their trust certificates at the dissolution amount and the trust certificates will be delisted. In this event, there would be implications for the tradability and listing of the trust certificates. - Fitch expects Omniyat to maintain a tangible asset ratio above 50%. The obligor has a small base of unencumbered tangible assets totalling USD345 million, of which USD221 million is allocated to the newly issued sukuk instrument. Omniyat's asset base is therefore sufficiently strong to support the trust certificates. - The terms of the trust certificates include a negative pledge provision, obligor event, change-of-control clause,and restrictive and financial covenants regarding the trustee. The transaction documents are governed by English law and the laws of the Emirate of Dubai and, to the extent applicable in the Emirate of Dubai, the federal laws of the United Arab Emirates. Fitch does not express an opinion on whether the relevant transaction documents are enforceable under any applicable law. However, Fitch's rating on the trust certificates reflects the agency's belief that Omniyat would stand behind its obligations. - Fitch does not express an opinion on the trust certificates' compliance with shari'a principles when assigning ratings to the trust certificates. Peer Analysis The instrument's rating is derived from Omniyat's Long-Term IDR. Key Assumptions The instrument is issued on behalf of Omniyat via the special-purpose vehicle Omniyat Sukuk 1 Limited. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A downgrade of Omniyat's IDR would lead to similar action on the sukuk rating. The sukuk's rating may also be sensitive to adverse changes to the roles and obligations of Omniyat and Omniyat Sukuk 1 Limited under the trust certificates' structure and documents. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - An upgrade of Omniyat's IDR will be mirrored in the sukuk rating. Liquidity and Debt Structure See the Rating Action Commentary "Fitch Assigns Omniyat Holdings First-time 'BB-' IDR" dated 4 April 2025. Issuer Profile Omniyat is a Dubai-based homebuilder focused on the luxury end of the housing market. Date of Relevant Committee 04-Sep-2025 MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor 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 Omniyat has an ESG Relevance Score of '4' for Governance Structure. This reflects significant dependence on the decision-making of the founders, 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 ----------- ------ -------- ----- Omniyat Sukuk 1 Limited senior unsecured LT BB- New Rating RR4 BB-(EXP) =================================== D O M I N I C A N R E P U B L I C =================================== [] DOMINICAN REPUBLIC: Abinader Points to Tourism as Job Generator ------------------------------------------------------------------ Dominican Today reports that President Luis Abinader highlighted tourism as the Dominican Republic's "main industry," supporting hundreds of thousands of jobs. He noted that over 11 million visitors in 2024 are expected to sustain 750,000 direct jobs and more than 870,000 indirect jobs, making tourism one of the region's largest generators of employment opportunities, according to Dominican Today. Abinader also praised the growing participation of women in the tourism sector, free trade zones, and the digital economy, stressing the importance of policies that promote equality, the report notes. However, he warned that informal employment, which accounts for 54% of the workforce, remains a major challenge, along with youth unemployment and the lack of migrant rights, the report discloses. Speaking at the XX American Regional Meeting of the International Labor Organization (ILO) in Punta Cana, the president called for a regional shift toward a model where work ensures dignity, justice, and shared prosperity, the report adds. About Dominican Republic The Dominican Republic is a Caribbean nation that shares the island of Hispaniola with Haiti to the west. Capital city Santo Domingo has Spanish landmarks like the Gothic Catedral Primada de America dating back 5 centuries in its Zona Colonial district. Luis Rodolfo Abinader Corona is the current president of the nation. TCR-LA reported in April 2019 that Juan Del Rosario of the UASD Economic Faculty cited a current economic slowdown for the Dominican Republic and cautioned that if the trend continues, growth would reach only 4% by 2023. Mr. Del Rosario said that if that happens, "we'll face difficulties in meeting international commitments." An ongoing concern in the Dominican Republic is the inability of participants in the electricity sector to establish financial viability for the system. Standard & Poor's credit rating for Dominican Republic was raised to 'BB' in December 2022 with stable outlook. Moody's credit rating for Dominican Republic was last set at Ba3 in August 2023 with the outlook changed to positive. Fitch, in December 2023, affirmed the Dominican Republic's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-' and revised the outlook to positive. =========== P A N A M A =========== CREDICORP BANK: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable ---------------------------------------------------------------- Fitch Ratings has affirmed Credicorp Bank, S.A.'s Long-Term Issuer Default Rating (IDR) at 'BB+', Short-Term IDR at 'B', Viability Rating (VR) at 'bb+' and the Government Support Rating (GSR) at 'No Support' ('ns'). Fitch has also affirmed Credicorp's Long- and Short-Term National Ratings at 'AA(pan)' and 'F1+(pan)', respectively. The Rating Outlook for the Long-Term IDR and Long-Term National Ratings is Stable. Key Rating Drivers Operating Environment with Moderate Influence: Panama's sovereign rating (BB+/Stable) and broader operating environment moderately influence Credicorp's VR, with the sovereign rating continuing to cap the Operating Environment (OE) score despite fundamentals that point to a 'bbb' category. While GDP growth has slowed and interest rates remain high, system credit growth, asset quality, and profitability are outperforming Fitch's expectations. Fitch projects GDP per capita and Operational Risk Index (ORI) to remain stable and continue to preserve operating conditions for banks. Consistent Business Profile with High Capitalization: Credicorp's international and national scale ratings are driven by its 'bb+' VR. Fitch views Credicorp's business profile as strong, supported by conservative risk management, which has led to good asset quality and resilient profitability. Credicorp's capital strength significantly influences Fitch's decision to rate the bank at the same level as the Panamanian sovereign and mitigates the risks inherent in its business model. Consolidated Business Model: Fitch's 'bb-' score for Credicorp's business profile exceeds the implied level of 'b'. Credicorp's consistent business model, marked by a lower-risk, atomized customer base and proven earnings generation, offsets its lower levels of total operating income (TOI) compared to regional peers. From 2022 to 2025, the bank's average TOI was USD74 million. Credicorp's market position is moderate, with a market share of 1.5% by assets in the banking system. The bank's strategy focuses on strengthening its local franchise through consumer lending and enhancing operational and commercial efficiencies via medium-term digital transformation. Well-Managed Risks: Fitch views Credicorp's underwriting standards and risk controls as sound, demonstrated by controlled loan deterioration over the economic cycle, resulting in lower credit costs than direct peers. As of June 2025, its loan impairment charges-to-average gross loans ratio was 0.3%, below other mid-sized banks. Fitch's assessment is also supported by the bank's reasonable collateral levels, prudent investment policies and conservative balance sheet growth. Good Asset Quality: Credicorp has maintained good asset-quality metrics that compare favorably with most local peers by metrics and concentration. As of June 2025, stage 3 loans comprised 2.0% of the portfolio. Loan loss allowance coverage of stage 3 loans was a reasonable 74.9%. Good levels of collaterals also support this assessment Fitch expects asset quality ratios to remain stable, with a forecasted stage 3 ratio of 2.1% for 2026 and 2027. As of June 2025, Credicorp's collaterals represented 81.2% to the total loan portfolio, while the top 20 borrowers represented 0.64x of the common equity Tier 1 (CET1) ratio. Fitch expects the bank to keep loan delinquencies at manageable levels by focusing on sectors and products where it has extensive expertise. Consistent Profitability Supported by Associates: Credicorp has demonstrated good profitability and resilience. As of June 2025, the operating profit-to-risk-weighted assets (RWA) ratio was 2.4%, above the 2022-2025 average of 2.0%. Stable asset performance and recurrent profits from investments in associated companies have bolstered profitability. The net interest income from the loan book continues to compose nearly 68.8% of TOI. However, Credicorp's operating profits are substantially supported by the profits generated by associates, which as of June 2025 made up 50.6% of the bank's operating profit (average 2022-2025: 41.1%). Fitch expects Credicorp's profitability to remain strong, supported by its growth targets and benefits from its associates. Fitch forecasts an operating profit to RWA ratio of 2.2% for 2026 and 2027. Capitalization a Rating Strength: Credicorp's capitalization and leverage ratios are stronger versus similarly rated peers, and Fitch deems them a rating strength. As of June 2025, the bank's regulatory CET1-to-RWA ratio was 21.9%, far exceeding the 10.5% total regulatory minimum. When including the regulatory countercyclical buffer (CCyB), the CET1 ratio reaches 23.6%. Fitch expects the bank's capitalization ratios to remain strong in the foreseeable future, supported by reasonable credit growth, consistent earnings generation, and moderate dividend payments. Fitch forecasts a CET1 ratio (including dynamic provision) of approximately 24% for 2026 and 2027. Stable Deposit Base: Credicorp's financing is supported by a growing deposit base that has historically maintained the loan-to-deposit ratio below 100%, ahead of its closest peers. As of June 2025, the ratio was 91.5%, influenced by moderate loan growth. Although its funding is concentrated, with customer deposits representing 92.8% of total funding, Credicorp complements its funding structure with medium-term wholesale sources that support asset-liability management. As of June 2025, the balance of the 20 largest depositors represented 27.8% of total deposits, a proportion that has decreased in recent years, in line with the bank's funding deconcentration strategy (June 2022: 36.8%). Fitch expects funding and liquidity metrics to remain stable in the medium term, with a likely loans to deposits ratio of 91.8% for both 2026 and 2027. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Downward revision of Fitch's OE score; - Consistently deteriorating financial performance due to worsening asset quality that results in the CET1-to-RWA ratio, including the CCyB, reaching levels consistently below 21%; - Materially lower TOI due to traditional banking business deterioration and lower profits from investments in associated companies. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - There is limited upside potential for Credicorp's VRs, IDRs and National Scale ratings in the short and medium terms, as Fitch does not expect to rate a bank with Credicorp's franchise and competitive position higher than the sovereign rating due to its business and risk concentrations. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS National Scale Senior Unsecured Debt: Credicorp's senior unsecured debt is rated at the same level as the bank's Long-Term National Rating as, in Fitch's view, the likelihood of default on the debt is the same as that for Credicorp. National Scale Subordinated Debt (Tier 2): The notes are rated three notches below the bank's 'AA(pan)' National Scale Rating, which is the anchor rating. There is a two-notch adjustment to reflect loss severity risk and an additional one notch for non-performance risk. The loss severity risk reflects the issue's subordinated preferred debt status and expected poor recovery prospects in a liquidation event relative to the bank's senior debt. The non-performance risk considers the bank's option to defer or cancel interest payments on a noncumulative basis if the bank breaches regulatory minimum capital ratios or if other events with the potential to impact the bank's capital adequacy should occur. GSR: The GSR of 'ns' reflects Fitch's view that support from the central authorities cannot be relied upon given the banking system's large size regarding economy and weak support stance due to Panama's lack of a lender of last resort. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES National Scale Senior Unsecured Debt: The Long-Term National Scale debt ratings would be downgraded or upgraded based upon changes to Credicorp's Long-Term National Scale Rating. National Scale Subordinated Debt: The rating of the Tier 2 subordinated notes would be downgraded or upgraded based upon changes to Credicorp's Long-Term National Scale Rating, at all times maintaining a three-notch differential from the bank's Long-Term National Scale Rating. GSR: - There is no downside potential for the GSR. - As Panama is a dollarized country with no lender of last resort, an upgrade of the GSR is unlikely. VR ADJUSTMENTS The OE Score of 'bb+' has been assigned below the 'bbb' category implied score due to the following adjustment reason: Sovereign Rating (negative). The Business Profile score of 'bb-' has been assigned above the 'b' category implied score due to the following adjustment reason: Business Model (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 ----------- ------ ----- Credicorp Bank, S.A. LT IDR BB+ Affirmed BB+ ST IDR B Affirmed B Natl LT AA(pan) Affirmed AA(pan) Natl ST F1+(pan) Affirmed F1+(pan) Viability bb+ Affirmed bb+ Government Support ns Affirmed ns senior unsecured Natl LT AA(pan) Affirmed AA(pan) subordinated Natl LT A(pan) Affirmed A(pan) ===================== P U E R T O R I C O ===================== CIUDAD DEPORTIVA: Case Summary & 12 Unsecured Creditors ------------------------------------------------------- Debtor: Ciudad Deportiva Roberto Clemente, Inc. 15 Las Mansiones Avenue Las Mansiones de San Martin San Juan, PR 00924 Business Description: Ciudad Deportiva Roberto Clemente, Inc. operates in the sports and recreation industry from its base in Carolina, Puerto Rico, where it was established to develop and manage athletic and educational facilities for youth and the community. The nonprofit entity was created to oversee a large-scale sports complex known as Sports City, intended to provide baseball fields, courts, swimming pools, and training areas. It reports business activity under the classification of "Other Amusement and Recreation Industries" and maintains limited operations tied to sports, education, and recreational services. Chapter 11 Petition Date: September 27, 2025 Court: United States Bankruptcy Court District of Puerto Rico Case No.: 25-04345 Judge: Hon. Enrique S Lamoutte Inclan Debtor's Counsel: Hector Eduardo Pedrosa Luna, Esq. THE LAW OFFICES OF HECTOR EDUARDO PEDROSA LUNA P.O. Box 9023963 San Juan PR 00902-3963 Tel: 787-920-7983 Email: hectorpedrosa@gmail.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Luis Roberto Clemente-Zabala as president. A full-text copy of the petition, which includes a list of the Debtor's 12 unsecured creditors, is available for free on PacerMonitor at: https://www.pacermonitor.com/view/3NS3SQY/CIUDAD_DEPORTIVA_ROBERTO_CLEMENTE__prbke-25-04345__0001.0.pdf?mcid=tGE4TAMA ********* 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. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. . * * * End of Transmission * * *