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T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, November 26, 2025, Vol. 26, No. 236
Headlines
A R G E N T I N A
ARGENTINA: Signs Deal w/ Chubut to Scrap Export Duties on Crude Oil
ARGENTINA: U.S. Banks Shelve $20 Billion Bailout Plan
B R A Z I L
BRAZIL: Lula Stares Down Trump and Scores Tariff Victory
CENTRAIS ELETRICAS: Fitch Affirms 'BB-' IDR, Alters Outlook to Pos.
ELDORADO BRASIL: Fitch Assigns 'BB' Rating to Sr. Unsecured Notes
ERO COPPER: Moody's Affirms 'B1' CFR, Outlook Remains Stable
C O L O M B I A
BANCO DAVIVIENDA: Fitch Affirms BB+ Long-Term IDR, Outlook Negative
BANCO DE BOGOTA: Fitch Corrects Outlook on 'BB+' LT IDR to Negative
BANCO DE OCCIDENTE: Fitch Affirms 'BB+' Long-Term IDR, Outlook Neg.
BANCOLOMBIA S.A: Fitch Affirms 'BB+' Long-Term IDR, Outlook Neg.
CORPORACION FINANCIERA: Fitch Affirms 'BB+' LT IDR, Outlook Neg.
E L S A L V A D O R
EL SALVADOR: IDB OKs $195MM-Loan to Modernize Int'l Airport
J A M A I C A
MEDICAL DISPOSABLES: Shrinks Net Loss to $28.5 Million in Q2
M E X I C O
BRASKEM IDESA: Fitch Lowers Local & Foreign Currency IDRs to 'CC'
P U E R T O R I C O
PET HOTELS: Files Amendment to Disclosure Statement
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A R G E N T I N A
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ARGENTINA: Signs Deal w/ Chubut to Scrap Export Duties on Crude Oil
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Buenos Aires Times reports that President Javier Milei's government
disclosed the elimination of duties on crude oil exports.
Government officials inked a memorandum of understanding with
Chubut Province to advance in the elimination of export duties on
conventionally produced oil, part of a strategy designed to
encourage investment and preserve jobs, according to Buenos Aires
Times.
Cabinet Chief Manuel Adorni, Economy Minister Luis Caputo and
Interior Minister Diego Santilli joined Chubut Province Governor
Ignacio Torres at the Economy Ministry to sign a memorandum of
understanding between the Nation and the Patagonian province with
the aim of "preserving activity in the mature oil fields, giving
predictability to investments and looking after jobs," the report
notes.
The meeting was also attended by Energy & Mining Secretary Daniel
Gonzalez and Carlos Ormachea, the head of the CEPH (Camara de
Exploracion y Produccion de Hidrocarburos) chamber from the sector,
the report notes.
"This agreement to share efforts beginning with Chubut and
extending progressively to the remaining oil-producing provinces
was signed," the Economy Ministry indicated in a statement obtained
by the news agency, says the report.
With the understanding, the national state has committed itself to
adjusting the existing export duties regime, advancing their
removal from conventionally produced crude, the report says. In
turn, the province "ratifies and deepens its policies of
accompaniment view, revision of royalties and the companies pledge
themselves to maintaining production and the investment plans
necessary to guarantee the continuity of activity," the report
notes.
According to the Economy Ministry, "investments within this
framework give priority to projects destined to increase the
production of conventional fossil fuels, reactivating plants and
wells in mature fields, increasing the operational efficiency and
sustaining the levels of direct and indirect employment associated
with the industry," the report relays.
Governor Torres described the elimination of export duties as "a
historic step which we firmly defend from the Agreement on
Competitiveness on which we have been working together with the
companies and trade unions of the sector," the report says.
"It represents the third most important investment in the Gulf of
San Jorge basin with an estimated impact of US$370 million which
will be directly reinvested into the industry," he added, notes
Buenos Aires Times.
The understanding establishes a scheme of efforts shared between
three players:
– The National State: Commits itself to adjusting its export
duties regime with the focus on removing export duties from
conventionally produced crude oil.
– Chubut Province: Will accompany with a revision of royalties.
– Companies: Will have to maintain production and the investment
plans to guarantee the continuity of activity.
The measures seek to encourage projects which reactivate plant and
wells in mature oil fields, increase production and maintain
employment levels, the report discloses.
The government has pointed out that this policy will be
progressively extended to the remaining oil-producing provinces in
line with the decision to reduce the tax burden and promote new
investments, 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.
ARGENTINA: U.S. Banks Shelve $20 Billion Bailout Plan
-----------------------------------------------------
The Wall Street Journal reports that a planned $20 billion bailout
to Argentina from JPMorgan Chase, Bank of America and Citigroup has
been shelved as bankers pivot instead to a smaller, short-term loan
package to support the financially distressed government.
Treasury Secretary Scott Bessent and the Trump administration had
been seeking to bolster Argentine President Javier Milei's
pro-reform party when they announced a pair of financial lifelines
this fall, notes the report. The package included a $20 billion
currency swap with the U.S. Treasury Department and plans for a
separate $20 billion bank-led debt facility.
The private-sector loan didn't get off the ground as banks awaited
guidance from the Treasury Department on what collateral and
guarantees they could use to shield them from losses, The Wall
Street Journal previously reported. Now, bankers are saying it is
no longer under serious consideration, according to people familiar
with the conversations.
Instead, banks are focused on plans to lend Argentina around $5
billion through a short-term repurchase, or "repo" facility, where
Argentina would exchange a portfolio of investments for dollars
from the banks, the people said, notes WSJ.
Argentina would be expected to use the dollars to make a coming
debt payment of around $4 billion in January, the people said, adds
the report.
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.
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B R A Z I L
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BRAZIL: Lula Stares Down Trump and Scores Tariff Victory
--------------------------------------------------------
Bloomberg News reports that in an executive order, Trump exempted
dozens of Brazilian food products, including coffee, beef, cocoa
and fruits, from the 40% increased tariffs he imposed in an
ill-fated attempt to help former President Jair Bolsonaro dodge a
coup attempt trial.
Together with prior exemptions, the move will leave many of the
nation's major exports free from heightened US duties, a victory
for an agricultural powerhouse that ranks as the world's largest
beef and coffee producer and counts the US as its No. 2 trade
partner, according to Bloomberg News.
The move also follows a similar order by the administration to
remove tariffs on several agricultural products from other
countries as the White House makes a U-turn on some tariffs that
have increased the cost of food in the United States, notes Reuters
in a separate report.
The changes are retroactive to Nov. 13, says Bloomberg.
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.
As reported by the Troubled Company Reporter - Latin America on
November 18, 2025, Fitch Ratings has assigned a 'BB' rating to
Brazil's USD1.5 billion notes maturing on Feb. 4, 2033. The
rating is in line with Brazil's Long-Term (LT) Foreign
Currency (FC) Issuer Default Rating (IDR). On June 25, 2025,
Fitch affirmed Brazil's LT FC IDR at 'BB' with a Stable Rating
Outlook.
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-'. DBRS' credit rating for Brazil was last reported
at BB with stable outlook at July 2023.
CENTRAIS ELETRICAS: Fitch Affirms 'BB-' IDR, Alters Outlook to Pos.
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Fitch Ratings has affirmed Centrais Eletricas Brasileiras S.A.'s
(Eletrobras, now Axia Energia) Long-Term Foreign and Local Currency
Issuer Default Ratings (IDRs) and senior unsecured bonds at 'BB-'.
Fitch has also affirmed the National Scale ratings for Axia Energia
and its subsidiary Companhia Hidro Eletrica do Sao Francisco S.A.
(Chesf), including Chesf's debenture issuance, at 'AA(bra)'. The
Rating Outlook was revised to Positive from Stable.
The Positive Outlook reflects Fitch's expectation of an improvement
on Axia Energia's cash generation and credit metrics due to the
combination of the announced assets sales and Fitch's more
favorable assumptions for the group's energy sales prices.
Axia Energia's ratings reflect its significant and diversified
asset base, which dilutes operational and regulatory risks. The
group benefits from strong liquidity and financial flexibility to
meet debt obligations and higher capex plans. Chesf's rating is
equal to Axia Energia's rating due to medium-to-high incentives of
support from the parent.
Key Rating Drivers
Quick Deleveraging: Asset sales and stronger EBITDA performance
should allow Axia Energia to improve its credit metrics. Net
adjusted financial leverage, including off-balance guarantees, is
expected to range 3.0x-3.5x from 2026 to 2028, with 3.5x in 2026,
with average gross leverage around 4.0x for the period - 4.0x in
2026. Conclusion of the sale of Eletronuclear S.A. and Empresa
Metropolitana de Aguas e Energia S.A's (EMAE) shares sale should
represent an adjusted net debt reduction of BRL9.5 billion,
partially offset by an expected additional BRL4.3 billion in
extraordinary dividends. These ratios were 3.4x and 4.9x,
respectively, in the last 12 months ended September 2025.
Advances in DeRisking: Eletronuclear's sale will represent a
significant de-risk initiative for Axia Energia's credit profile.
The subsidiary has a large capex program over the next years
associate with the construction of the nuclear thermal plant Angra
III (1.4GW, under construction). Besides the operational risk
reduction, the transaction will have a meaningful positive
financial impact of BRL8.8 billion to Axia Energia, from a
combination of off-balance debt release (BRL5.9 billion), cash
support avoidance (BRL2.4 billion) and cash inflow for the equity
sale (BRL535 million), which will strengthen its financial
profile.
The company has been successful in selling non-core assets. In
October 2025, it completed the sale of 100% of its thermal power
plant portfolio—comprising 13 plants with 2.1 GW of installed
capacity—in a transaction that brought in BRL 3.6 billion in
cash. Additionally, in the same month, Axia Energia announced the
sale of its 38.81% minority stake in the generation company EMAE.
This transaction is expected to close in the coming months and will
generate BRL476 million in cash inflow for Axia Energia.
Better Trends for Merchant Position: Axia Energia's large
uncontracted capacity exposes the group to energy price risk.
Positively, Fitch expects energy leaving the quotas regime to sell
at better prices than current levels and prior assumptions. Fitch
estimates available energy of 4.1GW in 2026, 7.6GW in 2027 and
8.0GW in 2028, implying uncontracted positions of 23%, 43% and 45%.
The new base case assumes BRL252/MWh in 2026, BRL212/MWh in 2027
and BRL187/MWh in 2028, versus around BRL90/MWh for ending quotas
contracts and about 17% above the prior assumptions.
Capex Pressures FCF: EBITDA is expected to improve driven by higher
energy prices, transmission revenues from new assets, and
efficiency gains—rising from BRL19.2 billion in 2025 to BRL23.2
billion in 2026 and BRL24.9 billion in 2027. FCF should be negative
BRL7.5 billion in 2025 due to heavy capex (BRL8.9 billion) and
dividends (BRL8.3 billion), buffered by strong liquidity, with the
dividend payout ratio reverting to 25% from 2026. Base case
scenario for the rating incorporates BRL25.0 billion in capex for
2026-2028, with the negative FCF in 2026 (BRL898 million) turning
positive and averaging roughly BRL1.0 billion in 2027-2028.
Strong Business Profile: Axia Energia is Brazil's largest
generation and transmission company, with 44 GW of installed
generation capacity, fully from renewable sources, and 74,769 km of
transmission lines, or 22% and 37% of respective national market
share. The business diversification in segments and assets reduces
operational and regulatory risks for the group. Around 60% of
consolidated revenues have contracts in the regulated market, 40%
from the transmission segment and 20% for generation. These
revenues are adjusted annually by inflation rates, which provides
some visibility on cash generation.
Subsidiary's Rating Equalized: Fitch equalizes the National Scale
ratings of Chesf and Axia Energia due to the medium to high set of
legal, operational and strategic incentives for the controlling
shareholder to support the subsidiary, if needed. Axia Energia
holds a 100% stake of Chesf and this subsidiary is included in
cross default clauses of the parent's Eurobonds and local
debentures. The operating and strategic incentives are mainly based
on the importance of Chesf's assets for Axia Energia group and the
centralized operational and financial decisions.
Peer Analysis
Axia Energia' IDRs reflect its geographic concentration in Brazil,
compared with its peers operating in higher rated countries in the
region, such as Chile (A-/Stable) and Colombia (BB+/Negative),
where Enel Americas S.A. (BBB+/Stable) and Interconexion Electrica
S.A. E.S.P. (BBB/Negative) are respectively located. Locally,
Eletrobras' 'BB-' rating is two to three notches below the LC IDR
of other Brazilian generation and transmission groups, due to its
higher uncontracted position and weaker financial profile, despite
its larger size and asset diversification.
In generation, Engie Brasil Energia S.A. (Engie Brasil) and Auren
Energia S.A. (Auren) both have FC IDRs of 'BB+'/Stable and LC IDRs
of 'BBB-'/Stable. Axia Energia has an installed capacity of
approximately 44.2GW, which compares favorably with Engie Brasil
(9.3GW) and Auren (8.8 GW). Axia Energia is also the largest power
transmission company in Brazil, with 74,769 km of transmission
lines in operation, compared to 11.943 km for Transmissora Alianca
de Energia Eletrica S.A. (Taesa, FC and LC IDRs BB+/Stable) and
7,139 km for Alupar Investimento S.A. (Alupar, FC IDR BB+/Stable,
LC IDR BBB-/Stable).
Axia Energia has higher gross and net leverage than most of its
higher rated peers. The company's expected gross and net leverage
for 2025, 4.7x and 3.3x, respectively, compares to gross and net
leverage of 3.7x and 3.2x for Engie Brasil, 4.2x and 3.7x for Taesa
and 4.0x and 3.0x for Alupar. Alupar and Taesa also have a lower
business risk profile due to their concentration in the electricity
transmission segment, which has lower volatility than generation.
Key Assumptions
Fitch's Key Assumptions within the Rating Case for the Issuer
Include
- Annual energy sales of 16.5 GW on average during 2025-2028;
- Average sales price for the uncontracted capacity of BRL174/MWh
in 2025, BRL252/MWh in 2026 and BRL212/MWh in 2027;
- Selling, general and administrative expenses adjusted by
inflation;
- Dividends of 25% of net income from 2026 on;
- Capex of BRL25.0 billion in 2025-2028;
- No cash outflows associated with outstanding guarantees to
nonconsolidated subsidiaries;
- Conclusion of the sale of Eletronuclear and EMAE in 2026.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Total adjusted leverage above 6.0x or net adjusted leverage above
5.0x on a sustainable basis;
- Higher pressure on expected FCF;
- Deterioration of debt and liquidity profiles;
- Continuity of a high uncontracted energy position;
- Increasing risk relative to off-balance-sheet guarantees.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Better than expected FCF trends;
- Eletrobras' uncontracted energy position declines, allowing
greater cash flow visibility;
- Total adjusted leverage below 5.5x and net adjusted leverage
below 4.0x on a sustainable basis;
- Closing of Eletronuclear's and EMAE shares sales as announced.
Liquidity and Debt Structure
Axia Energia' strong liquidity and ample access to funding are key
rating considerations as they improve its financial flexibility to
manage its debt maturity schedule. The group's consolidated cash
and marketable securities of BRL28.3 billion on Sept. 30, 2025
compare with BRL26.1 billion debt due until 2028, including
short-term debt of BRL12.8 billion.
Axia Energia' adjusted consolidated debt of BRL94.1 billion was
mainly concentrated in debentures (48%) and BNDES (20%). Foreign
currency debt is manageable and hedged to BRL, representing around
18% of the group's debt. Off balance sheet debt of BRL22.1 billion
mainly consisted of corporate guarantees of loans to UHE Belo Monte
(BRL13.6 billion) and Angra 3 (BRL5.9 billion).
Issuer Profile
Eletrobras (now Axia Energia) is the largest electric energy group
in Brazil, being responsible for 22% of the installed generation
capacity and 37% of the transmission lines in the country. The
company does not have a controlling shareholder.
Summary of Financial Adjustments
Adjustments include net revenues and EBITDA net of construction
revenues and cost.
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
----------- ------ -----
Centrais Eletricas
Brasileiras S.A.
(Eletrobras) LT IDR BB- Affirmed BB-
LC LT IDR BB- Affirmed BB-
Natl LT AA(bra) Affirmed AA(bra)
senior unsecured LT BB- Affirmed BB-
Companhia Hidro
Eletrica do Sao
Francisco S.A. Natl LT AA(bra) Affirmed AA(bra)
senior secured Natl LT AA(bra) Affirmed AA(bra)
ELDORADO BRASIL: Fitch Assigns 'BB' Rating to Sr. Unsecured Notes
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Fitch Ratings has assigned a 'BB' rating to the proposed
benchmark-size senior unsecured notes due 2032, to be issued by
Eldorado Intl. Finance GmbH and guaranteed by Eldorado Brasil
Celulose S.A. (Eldorado) and Cellulose Eldorado Austria GmbH.
Proceeds from the notes will be used to repay certain existing
indebtedness. Fitch currently rates Eldorado's Long-Term Foreign
Currency and Local Currency Issuer Default Ratings (IDRs)
'BB'/Stable.
The ratings reflect Eldorado's solid operating performance, its
above-average business profile characterized by a competitive cost
structure, and its limited diversification, with a single pulp
mill. Robust cash flow generation and deleveraging in recent years
have allowed the company to absorb higher indebtedness. Eldorado
faces the important challenge of continuing to extend the debt
maturity profile, which remains concentrated in 2026-2028.
The Stable Outlook reflects Fitch's expectation that Eldorado's net
leverage will increase to about 4x in 2025 before decreasing to
nearly 3x by 2027.
Key Rating Drivers
Above-Average Business Profile: Eldorado has only one pulp mill,
which is in Brazil and has an annual production capacity of 1.8
million tons of bleached eucalyptus kraft pulp (BEKP). Like other
Latin American pulp companies, Eldorado has a competitive cost
structure, with cash cost of production of approximately USD159 per
ton in 3Q2025, placing it firmly in the lowest quartile of the cost
curve. Eldorado has been able to consistently operate above its
nominal annual capacity.
Temporary Leverage Increase: Eldorado's past deleveraging strategy
allows the company to handle higher debt levels. Fitch expects net
debt to EBITDA to increase to about 4x in 2025, from 0.3x in 2024,
reducing to about 3.5x in 2026 and 3x in 2027. Fitch projects net
debt of about BRL11 billion at year end 2025, from BRL966 million
in December 2024, with a gradual reduction as the company uses FCF
and proceeds from the sale of forestry assets to pay down debt.
If pulp prices remain low for longer than expected, deleveraging
trend will be postponed. Its base case scenario excludes a new
investment cycle, at least until the company reduces net leverage
to the lower end of its 2.5x-3.5x financial policy target.
High Debt Maturities in 2026-2028: Recent issuances in the local
market and the proposed senior unsecured notes will help reduce
refinancing pressures in 2026. However, Eldorado still has high
debt maturities in 2027 and 2028, of approximately BRL10.6 billion,
and faces the important challenge of continuing to access suitable
credit lines, in either local or international markets, to extend
the debt maturity profile and reduce refinancing risk.
Positive FCF: Fitch expects Eldorado to generate about BRL2.7
billion of EBITDA and BRL2.7 billion in CFFO in 2025, and BRL3.1
billion and BRL2.0 billion, respectively, in 2026. These numbers
compare with BRL2.9 billion and BRL2.5 billion in 2024. As a
low-cost producer, the company maintains strong operating margins
throughout the pulp price cycle. Fitch forecasts positive FCF from
2026 on. Base case projections consider the sale and swap of
forestry assets of about BRL5.8 billion and annual investments
between BRL1.5 billion and BRL1.9 billion over the next three
years. Its base case projections do not include the pulp expansion
project.
Robust Forestry Assets: Eldorado's competitiveness is also related
to its modern production facility and the productivity of its
forestry assets. The forest assets further enhance its financial
flexibility, as the accounting value of the biological assets of
its forest plantations was BRL5.7 billion as of September 2025.
Pulp Price Volatility: Fitch expects BEKP prices will reach about
USD575 per tonne in 2025 and USD625 per tonne in 2026, down from an
average of USD625 per tonne in 2024. Tariff uncertainties led to
price fluctuations and paper producers delaying purchases. Prices
have fallen to about USD 500/ton, and Fitch expects some recovery
by year-end. A more significant recovery will depend on sustained
demand growth, which is unlikely until there is greater visibility
into tariff policies and global economic conditions. Sector
fundamentals remain solid, and Fitch does not expect any new
capacity to enter the market until 2028, supporting upward price
trends despite slower demand growth.
Peer Analysis
Like other Latin American pulp producers, Eldorado's pulp
production cash costs are among the lowest in the world, ensuring
its long-term competitiveness. This places the company's business
risk profile in line with Latin America pulp companies like Suzano
S.A. (BBB-/Positive), Empresas CMPC S.A. (BBB/Negative) and
Celulosa Arauco y Constitución S.A. (BBB/Negative).
Eldorado has only one mill located in Brazil, which makes it
comparable to LD Celulose S.A. (BB-/Positive), while other Latin
American peers have higher scale of operations and geographic
diversification. Eldorado is also concentrated only in BEKP pulp
and is therefore more exposed to the cyclicality of pulp prices
compared with companies with higher product diversification like
Klabin S.A. (BB+/Stable), Arauco and CMPC, which are leaders in the
packaging, wood products segment and tissue markets, respectively.
Key Assumptions
Fitch's Key Assumptions Within the Rating Case for the Issuer:
- Pulp sales volume of 1.75 million tons in 2025 and 2026;
- Average net hardwood pulp prices of USD575 per ton in 2025 and
USD625 per ton in 2026;
- Capex for a total of BRL5.0 billion between 2025 and 2027;
- Sale of forestry assets for about BRL5.8 billion in 2025;
- Base case does not incorporate investments in the new pulp mill.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Inability to extend debt maturity profile;
- Average net debt/EBITDA ratios of 4.0x or higher throughout the
pulp price cycle;
- Approval for the expansion project, pressuring Eldorado's
leverage;
- Change in the dividend distribution strategy and/or related party
transactions.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Improve business diversification;
- Average net debt/EBITDA ratios of 3.0x or below throughout the
pulp price cycle.
Liquidity and Debt Structure
Eldorado had cash and marketable securities of BRL5.9 billion as of
Sept. 30, 2025 and total debt of BRL16.8 billion, of which about
BRL4.1 billion is due by YE2026. Eldorado still has high debt
maturities of approximately BRL10.6 billion in 2027 and 2028.
Eldorado's BRL1.5 billion debentures in the local market concluded
in October 2025 and the proposed senior unsecured notes should
contribute to extend the company's debt maturity profile and Fitch
expects Eldorado to preserve a more conservative debt maturity
profile. Positive FCF and proceeds from the sale of forestry assets
should be mainly used to reduce debt.
Issuer Profile
Eldorado started operations in December 2012 and has one pulp mill
located in Mato Grosso do Sul State in Brazil. Its pulp mill has an
annual production capacity of 1.8 million tons of BEKP.
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
Eldorado Brasil Celulose S.A. has an ESG Relevance Score of '4[+]'
for Energy Management as the company sells excess energy to the
grid from cogeneration based upon a renewable resource, which has a
positive impact on the credit profile, and is relevant to the
ratings in conjunction with other factors.
Eldorado Brasil Celulose S.A. has an ESG Relevance Score of '4' for
Governance Structure due to ownership concentration and related
party transactions, 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
----------- ------
Eldorado Intl.
Finance GmbH
senior unsecured LT BB New Rating
ERO COPPER: Moody's Affirms 'B1' CFR, Outlook Remains Stable
------------------------------------------------------------
Moody's Ratings has affirmed Ero Copper Corp.'s ("Ero Copper or
Ero") B1 corporate family rating, B1-PD probability of default
rating, and B1 senior unsecured notes rating. Ero's Speculative
Grade Liquidity Rating ("SGL") was upgraded to SGL-1 from SGL-2.
The outlook remains stable.
The affirmation of the ratings is based on the Tucuma mine's
(located in the Carajas Mineral Province, Para State, Brazil)
transition to full commercial production and the expectation that
the company will generate substantial free cash flow in 2026, while
maintaining financial leverage below 2x. Ero Copper's operating
cash flow and liquidity are expected to be meaningfully bolstered
over the near term by the commencement of gold concentrate sales
from stockpiled material at its Xavantina mine. Ero Copper recently
announced the commencement of gold concentrate sales from
stockpiled material at its Xavantina mine. Sampling of this
stockpile indicates an inferred resource of about 29,000 ounces of
gold contained and the stockpiles will be monetized over the next
12-18 months.
RATINGS RATIONALE
Ero Copper benefits from: 1) the high grade and subsequent
competitive cost profile of its copper operations (C1 cash cost of
US$2.07/lb for the nine months ending September 2025); 2) expected
strong positive free cash generation as the Tucuma has now begun
commercial production; 3) the long mine life of its Caraiba
(located in the Curaca Valley, Bahia State, Brazil) operations
(about 18 years) and Tucuma (12 years); and 4) conservative
financial policies. Constraints include its: 1) small scale with
Moody's expectations of about 70,000 tonnes of copper at the
Caraiba and Tucuma operations and about 50,000 ounces of gold at
the Xavantina (in Mato Grosso State, Brazil) operations in 2026; 2)
mine concentration with a reliance on the Caraiba and Tucuma
operations (both located in Brazil) for most its operating cash
flow and 3) a concentration of cash flow largely from one metal
(copper).
Ero Copper has excellent liquidity to the end of 2026, with sources
totaling about $560 million compared to uses of about $40 million.
Sources include cash and short term investments of $68 million at
September 2025, $45 million available on its $200 million credit
facility (expiring December 2028) and Moody's expectations of about
$450 million in free cash flow generation through the end of 2026.
Uses are approximately $40 million in lease and borrowing
repayments to the end of 2026. Ero Copper has financial covenants
within its credit facility including a maximum leverage and minimum
interest coverage tests. Moody's expects the company will remain
well in compliance with its financial covenants.
The stable outlook reflects Moody's expectations that Ero Copper
will have stable operating performance at its mines, and will
prioritize de-levering with free cash flow.
Ero's senior unsecured notes due 2030 are rated B1, the same rating
level as the CFR, because it comprises the preponderance of the
company's funded debt.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The CFR could be upgraded if Ero Copper is able to achieve
increased scale and mine diversity and the company demonstrates a
track record of generating sustained positive free cash flow. It
would also require that financial leverage is sustained below 2.5x
and liquidity remains good.
Negative rating pressure could develop if the company experiences
material operational issues at its producing mines that results in
lower production and higher costs. Quantitatively, Moody's would
consider a downgrade if financial leverage is expected to increase
and be sustained above 3.5x.
Headquartered in Vancouver, Canada, Ero Copper is a public copper
and gold producer. The company's operations include the Caraiba
Mining Complex (copper), Tucuma Operations (copper) and the
Xavantina Operations (gold), all in Brazil. The company has ten
operating mines in Canada, Australia, Finland and Mexico and a
pipeline of exploration and development projects.
The principal methodology used in these ratings was Mining
published in April 2025.
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.
===============
C O L O M B I A
===============
BANCO DAVIVIENDA: Fitch Affirms BB+ Long-Term IDR, Outlook Negative
-------------------------------------------------------------------
Fitch Ratings has affirmed Banco Davivienda S.A.'s (Davivienda)
Long-and Short-Term Local and Foreign Currency Issuer Default
Ratings (IDRs) at 'BB+' and 'B', respectively. The Outlook for the
Long-Term IDR is Negative, aligned with the Colombia sovereign
rating. Fitch also affirmed Davivienda's Viability Rating (VR) at
'bb+' and National Long-and Short‑Term Ratings at 'AAA(col)' and
'F1+(col)'. Fitch also affirmed Grupo Bolivar S.A.'s (GB) National
Long- and Short-Term Ratings at 'AAA(col)' and 'F1+(col)',
respectively. The Outlook for Davivienda's and GB's National
Long-Term Rating is Stable.
Key Rating Drivers
Viability Rating Drives IDRs: Davivienda's IDRs are driven by its
VR, which is one notch above the 'bb' implied VR and reflects the
bank's strong business profile. This has a positive impact on
Davivienda's credit profile due to its leading market position in
Colombia as the second largest bank and adequate franchise in
Central America. The assessment also considers its sound risk
management and financial performance recovery amid the recent
challenging operating environment (OE), as well as its good capital
position and large, stable deposit base.
Gradual Operating Environment Recovery: Fitch expects the operating
environment (OE) for Colombian banks to remain stable, with
recovering credit growth despite macroeconomic challenges from
political uncertainty and government reforms. Although the
sovereign rating carries a Negative Outlook, driven by
deteriorating fiscal and public‑debt dynamics, Fitch expects
Davivienda to continue generating business volumes at acceptable
risk levels, given expectations that the Operational Risk Index
(ORI) and GDP per capita will remain broadly stable.
Strong Business Profile: Davivienda's business profile is
underpinned by its stable total operating income (TOI), strong
market position in Colombia and leading franchise in Central
America. Davivienda has a diversified business model, serving more
than 25 million customers and offering a full suite of retail and
commercial banking, as well as wealth management and capital market
services.
The four-year average TOI, at USD 2,575 million, is supported by
business and geographic diversification and has remained resilient,
underpinning overall financial performance while containing risk.
The recent announcement to integrate operations with Bank of Nova
Scotia (BNS) in Colombia, Costa Rica, and Panama aims to strengthen
Davivienda's market position in those target markets and capitalize
on synergies between Davivienda and BNS. The transaction remains
subject to regulatory approvals.
Asset Quality On Recovery Path: The consumer portfolio continued to
normalize in 3Q25, supporting a modest improvement in asset
quality. Backed by stricter risk controls, intensified collections,
and a shift toward higher-quality borrowers, 90+ day past-due loans
(PDL) fell by 1%. However, a 0.6% contraction in gross loans versus
YE 2024 weighed on delinquency metrics. As of September, 2025, the
90+ day PDL remained stable at 4.4% (Dec 2024: 4.4%), but compares
unfavorably with peers.
As higher-quality vintages gain weight in the portfolio and gross
loan growth recovers toward 6%, Fitch expects Davivienda's asset
quality metrics to continue improving, with 90+ day PDLs
stabilizing around 3.5% by YE 2025. Fitch expects meeting the
3.5%-4% target for PDL at end‑2025 remains a challenge, but it is
achievable if the bank maintains disciplined lending standards and
growth, supporting a continued decline in credit risk to below 3%.
Recovery in Profitability: Davivienda's profitability rose sharply
in 1H25, with operating profit to risk‑weighted assets rising to
1.5% at June 2025 from 0.1% at YE 2024, above the four‑year
average of 0.64%. The improvement was driven by a resilient net
interest margin, lower credit risk from improved asset quality, and
disciplined cost control. Margin expansion has continued, supported
by low‑cost funding and actions to neutralize interest‑rate
movements.
Davivienda's Earnings and Profitability score was upgraded to 'bb-'
from 'b+' with stable outlook, after operating profit to
risk-weighted assets reached the 1.25% threshold consistent with
the 'bb' category. The upgrade also reflects Fitch's expectation
this ratio will stabilize around 2% over the next two years,
supported by stabilizing loan impairment charges, a sustained
structural improvement in the net interest margin, and a recovery
in gross loan's growth.
Adequate Capital Metrics: As of September 2025, Davivienda's Common
Equity Tier 1 (CET1) ratio rose to 11.8% (from 11.0% in 2024),
reflecting the recovery in internal capital generation. The bank's
capital position is further supported by non-core loss-absorbing
instruments, including hybrid capital securities, which lift the
Tier 1 capital ratio to 13.4%.
Fitch expects capitalization to remain around 11.0% over the next
two years, consistent with a capitalization score of 'bb-' and
aligned with the bank's planned growth and earnings recovery. Sound
risk management, high collateral requirements, and resilient asset
quality also support the bank's capitalization profile.
Diversified and Stable Funding: Davivienda's funding and liquidity
assessment is enhanced by its good market position in deposits,
supported by ample banking infrastructure and digital
transformation. Its loans-to-deposits ratio was 108.2% as of
September 2025, below its four-year average of 116.7%, but still
above the peer average, as the bank utilizes longer-tenor funding
that helps to better match its assets and liabilities.
Following a temporary increase in term deposits, the bank is now
prioritizing growth in low-cost deposits to align with its strategy
of maintaining a cost-efficiency and flexible funding structure..
Conservative liquidity policies and a consolidated market position
will allow the bank to fulfill regulatory liquidity ratios above
100%.
Grupo Bolivar National Ratings and Senior Debt
Grupo Bolivar's (GB) National ratings reflect the creditworthiness
of its main subsidiary, Davivienda. GB's ratings are aligned with
Davivienda's due to its low double leverage (June 2025: 103%),
supported by a high level of earnings retention and strong cash
flow metrics that sufficiently meet its debt service requirements.
Additionally, GB's prudent liquidity management, as well as the
flexibility of its investment and contingency plans, ensures a
projected cash flow that sufficiently covers the debt service for
the next several years.
RATING SENSITIVITIES
- GB's National ratings will mirror any action taken on
Davivienda's National ratings;
- Additionally, a substantial increase of GB's leverage (double
leverage above 120%) or a sustained decline in the dividend flows
from the operating companies that result in a deterioration of its
debt coverage ratios could pressure GB's ratings;
- GB's national scale ratings are at the highest level on the
national scale; therefore, they cannot be upgraded.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
VR, IDRs and National Ratings
- The ratings could be downgraded if asset quality deterioration is
not controlled below levels of 4% and the profitability ratio
(operating profit-to-RWA) consistently deviates below the 1.25%
expected by Fitch in the next 12 to 24 months, resulting in an
erosion of CET1 consistently below 10%.
- A weakening of Fitch's assessment of the business or risk
profiles could trigger a downgrade.
- Davivienda's national scale ratings will reflect any change in
local relativities.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
VR, IDRs and National Ratings
- Given the OE limitations, a ratings upgrade is unlikely in the
medium term.
- Over the longer term, the ratings could be upgraded by a
confluence of OE improvement and in the bank's financial profile.
- Davivienda's national ratings have no upside potential because
they are at the highest level in the national rating scale.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
- Davivienda's AT1 notes are rated four notches below its VR. The
notching reflects the notes' higher loss severity in light of their
deep subordination, along with additional nonperformance risk
relative to the VR, given the high write-down trigger of CET1 at
5.125% and full discretion to cancel coupons. As such, the debt has
been affirmed due to the affirmation of Davivienda's VR.
- Davivienda's Tier 2 subordinated notes rating is two notches
below Davivienda's 'bb+' VR to reflect loss severity only. Fitch
did not apply notching for non-performance risk, as the notes do
not have additional loss-absorption features. The notes only
provide limited loss-absorption capacity due to their relatively
low trigger for principal write-off, which is a regulatory common
equity Tier 1 (CET1) ratio at or below 4.5%. Fitch believes the
trigger would not activate early enough to prevent a non-viability
event for the bank.
- Davivienda's local subordinated debt is rated two notches below
its National Long-Term Rating, encompassing two notches for loss
severity (-2) and zero notches for nonperformance risk (0), given
the issuance terms (plain vanilla subordinated debt).
- Davivienda's local senior unsecured bonds are rated at the same
level as the bank's National Long-Term Rating, considering the
absence of credit enhancement or any subordination feature.
The bank's Government Support rating of 'bb' reflects Davivienda's
size, systemic importance and the country's historical support
policy. Fitch believes there is a high probability of sovereign
support. Colombia's ability to provide such support is reflected in
the sovereign's Long-Term IDR (BB+/Negative).
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
- Davivienda's subordinated and junior subordinated debt ratings
will mirror any action on the bank's VR.
- Davivienda's local senior debt rating and subordinated debt
rating would move in line with its National Long-Term rating.
- Davivienda's GS are potentially sensitive to any change in
assumptions as to the propensity or ability of Colombia to provide
timely support to the bank.
VR ADJUSTMENTS
The VR is one notch above the 'bb' implied rating due to the
following adjustment reason: Business Profile (positive).
The Business Profile score has been assigned above the implied
score due to the following adjustment reason: Business Model
(positive).
The Earnings & Profitability score has been assigned above the
implied score due to the following adjustment reason: Historical
and Future Metrics (positive).
Public Ratings with Credit Linkage to other ratings
Grupo Bolivar's ratings are driven by the rating of its main
subsidiary, Banco Davivienda.
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
----------- ------ -----
Grupo Bolivar S.A. Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
senior unsecured Natl LT AAA(col) Affirmed AAA(col)
Banco Davivienda
S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Viability bb+ Affirmed bb+
Government Support bb Affirmed bb
subordinated LT BB- Affirmed BB-
junior
subordinated LT B Affirmed B
senior unsecured Natl LT AAA(col) Affirmed AAA(col)
subordinated Natl LT AA(col) Affirmed AA(col)
BANCO DE BOGOTA: Fitch Corrects Outlook on 'BB+' LT IDR to Negative
-------------------------------------------------------------------
This is a correction of a press release published Nov. 18, 2025. It
clarifies that the Rating Outlooks for Banco de Bogota S.A.'s
Long-Term Issuer Default Ratings is Negative rather than Stable as
stated in the original release.
Fitch Ratings has affirmed the international ratings of Banco de
Bogota S.A. (Bogota) and its holding company, Grupo Aval Acciones y
Valores S.A. (Grupo Aval). Fitch has affirmed Bogota's Viability
Rating (VR) and Long-Term Foreign and Local Currency Issuer Default
Ratings (IDRs) at 'bb+' and 'BB+', respectively. The Rating Outlook
for the Long-Term IDRs is Negative, reflecting the Colombian
sovereign rating. In addition, Fitch has affirmed the National
Scale Ratings of Aval Fiduciaria S.A. at 'AAA(col)', Outlook
Stable, and 'F1+(col)'.
Key Rating Drivers
VR Drives Bank Ratings: Bogota's Viability Rating (VR) is
influenced by its business profile, which is underpinned by its
leading franchise. The VR is one notch above the 'bb' implied VR
and reflects the bank's strong business profile. The ratings
reflect Bogota's consistent financial performance, reasonable
credit and risk policies, ample, diversified funding base and
improving capitalization, which is above that of local peers.
Gradual Recovery in the Operating Environment: Fitch expects the
operating environment (OE) for Colombian banks to remain stable,
with credit growth continuing to recover despite ongoing
macroeconomic challenges stemming from political uncertainty and
government reforms. Although the sovereign rating carries a
Negative Outlook, primarily driven by deteriorating fiscal and
public debt dynamics, Fitch expects Bogota to generate business
volumes at acceptable risk levels due to its expectations that the
Operational Risk Index (ORI) and GDP per capita metrics will remain
broadly stable.
Leading Franchise: Bogota is Colombia's third-largest bank in terms
of assets (12.8%), deposits (12.7%), net income (8.8%) and loans
(12.5%) as of June 2025, and is a systemically important financial
institution in that country. In 2020, Bogota integrated Multibank,
a Panamanian subsidiary. As of 2Q25, Multibank held market shares
of 3.6% in assets, 4.2% in loans and 3.5% in deposits. As of June
2025, 62.8% of Bogota's gross loans were corporate, with 84.1% of
consolidated loans booked in Colombia.
Fitch will closely follow developments arising from the recent
announcement that BAC International Corporation (BIC), the holding
company of BIB, will convene a shareholder meeting to discuss
acquiring from Bogota via Multi Financial Holding a majority stake
in Multi Financial Group Inc. (MFG) and its subsidiaries, including
Multibank. Currently, no immediate impact is expected for Bogota or
Aval.
Asset Quality Improvement: Bogota's loan portfolio quality had
improved as of June 2025 after significant deterioration in 2024.
The 90-day nonperforming loans (NPLs) ratio reached 3.8% (YE24:
4.4%), with consolidated loan loss reserve coverage of 1.21x, still
below pre-pandemic levels. Asset quality is expected to improve
during the remainder of 2025 due to lower interest rates and higher
loan growth.
Lower Cost of Risks Supports Profitability: Bogota's performance
has benefited from lower loan impairment charges (LICs) amid a
relatively stable net interest margin. As of June 2025, the bank's
operating profit-to-risk-weighted assets (RWAs) ratio was 1.6%,
above that of December 2024 (1.2%). Fitch Ratings expects this
ratio to stabilize at near 2.0% in the medium term, supported by a
reliable operating environment (OE), increased loan growth,
consistent margins and lower LICs.
Improving Capital Ratios: Bogota's capitalization ratios further
improved, even after the November 2023 shareholders' agreement to
transfer control of Corficolombiana from Grupo Aval to Banco
Popular. Bogota's capital is supported by sustained, improving
profitability, moderate dividend policies and controlled growth.
The CET1 ratio stood at 13.3% as of 2Q25 and Fitch expects Bogota's
capital ratios to remain around 13% in the medium term, above local
peers', resulting in the upgrade of the capitalization and leverage
factor score to bb from bb-.
Wide, Stable Funding: Bogota boasts an ample, well-diversified and
low-cost depositor base that fully supports its lending activities.
Fitch believes Bogota's liquidity and liquidity management are
appropriate for the risks the bank faces. Liquidity remains
sufficient and was supported by a gross loans-to-customers deposit
ratio of 99.7% as of June 2025, improving from the 2021-2024
average of 104.1%.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Bogota's VR and Issuer Default Ratings (IDRs) are sensitive to
material deterioration in the local OE or a negative sovereign
rating action.
- The ratings could be downgraded if an extended period of OE
deterioration significantly weakens asset quality and/or
profitability (operating profit to RWA consistently below 1.5%),
resulting in an erosion of capital buffers if the CET1 ratio
remains consistently below 10%.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Bogota's LT IDRs are on Negative Outlook, so an upgrade is not
possible.
- Over the longer term, an improving OE, together with improvement
in asset quality and profitability, could support
creditworthiness.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
Bogota's senior unsecured obligations are rated at the same level
as the bank's IDR. Its subordinated debt is rated two notches below
the bank's VR.
Bogota's Government Support Rating (GSR) of 'bb' reflects Fitch's
assessment of a moderate probability of sovereign support, if
required, given the bank's systemic importance. The ability of the
sovereign to provide support is based on its 'BB+'/Negative
rating.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- Bogota's debt ratings would align with the bank's IDRs and VR.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Bogota's debt ratings would align with the bank's IDRs and VR.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- Bogota's GSRs would be affected if Fitch changes its assessment
of the government's ability or willingness to support the bank.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Bogota's GSRs would be affected if Fitch changes its assessment
of the government's ability or willingness to support the bank.
SUBSIDIARIES & AFFILIATES: KEY RATING DRIVERS
GRUPO AVAL ACCIONES Y VALORES S.A. (GRUPO AVAL)
Strong, Competitive Position: Grupo Aval's ratings are driven by
the business and financial profile of its main operating
subsidiary, Bogota. Moderate double leverage, good cash flow
metrics and a sound competitive position in multiple markets also
support Grupo Aval's ratings. The group profile is also supported
by its noticeable consolidated market share of 24.6% of gross loans
in Colombia
Improving Performance at the Consolidated Level: Grupo Aval's
financial profile improved as of June 2025 amid the challenging OE.
Asset quality has improved in line with the banking system, with
consolidated 90-days NPL ratio of 3.5% as of June 2025 (4.2% at
June 2024). Fitch expects the NPL ratio to slightly improve in
2026, thanks to the Central Bank's expected expansionary monetary
policy and higher expected loan growth, coupled with a clearer
political environment after Colombia's elections.
The holding company's consolidated operating profit-to-estimated
RWAs ratio benefited from improving credit costs during 2025 and
improving margins, totaling 2.3% at June 2025, similar to the
2021-2024 average but above the average of 2023 and 2024 (1.6%).
Fitch expects the consolidated profitability ratio to return to the
2.5%-3% range due to higher loan growth and lower expected risk and
funding costs.
Moderate Double Leverage: On an unconsolidated basis, Grupo Aval's
double leverage is moderate (1.10x at June 2025 or 1.21x when
including subordinated loans to subsidiaries and the AT1
investment). This ratio is expected to remain stable in the short
term. Solid internal capital generation should continue to underpin
Grupo Aval's double leverage and debt coverage ratios.
SENIOR AND SUBORDINATED DEBT
GRUPO AVAL LIMITED
The ratings for Grupo Aval Limited's senior unsecured debt are
aligned with those of Grupo Aval, as this entity guarantees the
senior bonds issued by the former.
AVAL FIDUCIARIA S.A.
Aval Fiduciaria S.A.'s national ratings reflect the potential
support it would receive from its parent, Grupo Aval, should it be
required. In Fitch's view, Aval Fiduciaria is an integral part of
its parent's business model and is core to its strategy. Fitch also
considers in its support view the negative reputational
implications of a potential subsidiary default for the parent.
SUBSIDIARIES AND AFFILIATES: RATING SENSITIVITIES
GRUPO AVAL and GRUPO AVAL LIMITED
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- Grupo Aval's IDR would remain aligned with Bogota's and would
move in tandem with any rating action on its main operating
subsidiary. However, the relative positioning between the two
entities' ratings could also be affected by a material, sustained
increase in Grupo Aval's double-leverage metrics (consistently
above 1.2x), while also considering the holding company's liquidity
position and management quality. A change in dividend flows from
operating subsidiaries or debt levels at the holding company that
weakens debt coverage ratios could also be negative for the
rating;
- The ratings for Grupo Aval Limited's senior unsecured debt would
move in line with Grupo Aval's IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Grupo Aval's IDR would remain aligned with Bogota's and would
move in tandem with any rating actions on its main operating
subsidiary;
The ratings for Grupo Aval Limited's senior unsecured debt would
move in tandem with Grupo Aval's IDRs.
AVAL FIDUCIARIA S.A.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- A downgrade of Grupo Aval's Rating could result in a downgrade of
the fiduciary's rating;
- A deterioration in Grupo Aval's capacity or propensity to provide
support to Aval Fiduciaria could weaken the fiduciary's credit
profile.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- The ratings have no upside potential, as they are already at the
highest level of the National Rating Scale.
VR ADJUSTMENTS
- The VR has been assigned above the implied VR due to the
following adjustment reason: Business profile (positive).
- The Business Profile score has been assigned above the implied
score due to the following adjustment reason: Market position
(positive).
in the Applicable Criteria.
Public Ratings with Credit Linkage to other ratings
The ratings of Grupo Aval Acciones y Valores are driven by support
from its main subsidiary Banco de Bogota S.A.; The rating of Grupo
Aval Limited issuance is linked to the rating of Grupo Aval
Acciones y Valores S.A. The rating of Aval Fiduciaria S.A. is
driven by support from its parent Grupo Aval Acciones y Valores.
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
----------- ------
Aval Fiduciaria S.A. Natl LT AAA(col) Affirmed
Natl ST F1+(col) Affirmed
Banco de Bogota, S.A. LT IDR BB+ Affirmed
ST IDR B Affirmed
LC LT IDR BB+ Affirmed
LC ST IDR B Affirmed
Viability bb+ Affirmed
Government Support bb Affirmed
senior unsecured LT BB+ Affirmed
subordinated LT BB- Affirmed
Grupo Aval Acciones
y Valores S.A. LT IDR BB+ Affirmed
ST IDR B Affirmed
LC LT IDR BB+ Affirmed
LC ST IDR B Affirmed
Grupo Aval Limited
senior unsecured LT BB+ Affirmed
BANCO DE OCCIDENTE: Fitch Affirms 'BB+' Long-Term IDR, Outlook Neg.
-------------------------------------------------------------------
Fitch Ratings has affirmed Banco de Occidente S.A.'s (Occidente)
Foreign and Local Currency Long- and Short-Term Issuer Default
Ratings (IDRs) at 'BB+' and 'B', respectively, and its Viability
Rating (VR) at 'bb+'. In addition, Fitch has affirmed Banco de
Occidente (Panama), S.A.'s (BOP) Long-Term IDR at 'BB+'. The Rating
Outlook on the Long-Term IDRs is Negative.
Fitch has also affirmed Occidente's, BOP's, and Fiduciaria de
Occidente, S.A.'s (Fiduoccidente) National Scale Long- and
Short-Term Ratings at 'AAA(col)' and 'F1+(col)', respectively, and
Occidental Bank (Barbados) Ltd. (OBB) at 'AA+(col)' and 'F1+(col)',
respectively.
The Negative Outlook on Occidente's Long-Term IDR is aligned with
the Colombian Sovereign Negative Outlook as Occidente is rated at
the same level as the sovereign. The bank's ratings are more
sensitive to a potential downgrade of Colombia's ratings as Fitch
very rarely rates banks' IDRs based on their current intrinsic
credit profile above the sovereign rating. Conversely, the Outlook
on the Long-Term National Scale Ratings is Stable.
Key Rating Drivers
Standalone Credit Profile: Occidente's IDRs are driven by its
intrinsic creditworthiness, which is reflected in its 'bb+' VR. The
bank's VR is one notch above its implied 'bb' VR due to the high
influence of the bank's solid business profile on Fitch's
assessment. The agency believes Occidente's consistent business
model and strong market position allows the bank to generate modest
but consistent income over time. The VR also encompasses
Occidente's controlled asset quality, modest profitability metrics
and relatively tight capital ratios, along with its stable deposit
base and funding access.
Gradual Recovery in the Operating Environment: Fitch expects the
operating environment (OE) for Colombian banks to remain stable,
with credit growth continuing to recover despite ongoing
macroeconomic challenges which stem from political uncertainty and
government reforms. Although the sovereign rating carries a
Negative Outlook, primarily driven by deteriorating fiscal and
public debt dynamics, Fitch expects Occidente to continue to
generate business volumes at acceptable risk levels due to its
expectations that the Operational Risk Index (ORI) and GDP per
capita metrics will remain broadly stable.
Steady Business Profile: Occidente has a consolidated business
model with a consistent focus in commercial and corporate segments,
which represent around 70% of its loan book as of 1H25, and
maintains a solid market position as the sixth largest bank in
Colombia. Fitch estimates the bank will continue to exhibit stable
business operations, mirroring its business profile score of 'bb+'
over the foreseeable future.
Asset Quality Continues Reasonable: Occidente maintains stable
asset and credit quality, in alignment with the bank's prudential
risk policies and commensurate to its business orientation. As of
1H25, the 90+ day past due loans to total loans metric was 3.1%,
somewhat similar to its 2021-2024 average of 3.3%. However, these
metrics are relatively higher compared to some similarly rated
peers, supporting its asset quality score of 'bb'. Fitch estimates
Occidente's impairment levels will remain under control from its
effective credit and collection policies, along with consistent
loan growth over the ratings horizon.
Slightly Improved Profitability: Occidente exhibits a slight
improvement in its profitability levels supported by consistent
business and stable albeit narrow net margins, favorable treasury
income, and lightly reduced impairment charges. As of 1H25, the
operating profit to risk weighted assets (RWA) metric was 1.4%
(2021-2024 average: 1.3%) which is aligned with its earnings and
profitability score of 'bb-'. Fitch believes the bank's
profitability will continue at similar levels over the short to
medium term supported by sustained operations growth through its
well-positioned business.
Narrow but Stable Capitalization: Occidente maintains modest
capitalization levels, influenced by business and credit growth
higher than the industry average and consistent but relevant
dividend payments over the last few years. As of 1H25, its CET1 to
RWAS metric was 10.7% (YE24: 10.2%; YE23:10.9%), levels comparable
to and common at the largest Colombian banks. Considering the
bank's moderate growth prospects, Fitch estimates Occidente's
capitalization would continue commensurate with its 'bb-'
capitalization and leverage score over the foreseeable future.
Sound Funding Profile: Occidente's funding structure reflects a
solid demand deposits position, mainly through its institutional
and wholesale base. However, its deposits mix results in relatively
higher funding costs compared to peers with larger deposits
portfolios. As of 1H25, its loan to deposits metric was around 96%
(average 2021-2024: 101.5%). The bank's funding and liquidity score
of 'bb+' also reflects its relatively diversified non-deposit
funding, which supports its liquidity.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Occidente's VRs and IDRs are sensitive to a material
deterioration in the local operating environment or a negative
sovereign rating action;
- Occidente's VR and IDRs could be downgraded by a significant
deterioration of asset quality and profitability ratios that no
longer reflect the bank's good business profile — specifically,
an operating profit to RWAs ratio consistently below 1% and NPL
ratio above 5%.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- An upgrade is unlikely in the foreseeable future given the
constraints of the operating environment.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
Subordinated Debt: Occidente's subordinated debt is rated two
notches below the banks' VR. A two-notch step-down is applied for
loss severity, given the instrument's deep subordination within the
debt structure.
Sound Shareholder Support: Occidente's shareholder support rating
(SSR) of 'bb+' reflects Fitch's view of a high probability of
support from Grupo Aval Acciones y Valores S.A. (GA), if needed.
Fitch's assessment of the ability to provide support is highly
influenced by GA's 'BB+' IDR with a Negative Outlook. In addition,
Fitch's view of GA's propensity to support considers with high
influence Occidente's core role and key contribution to the group's
diversified business strategy and large-scale operations.
The SSR would be affected if Fitch changes its assessment of GA's
willingness and/or ability to provide support.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
Occidente's subordinated debt ratings would move in tandem with the
bank's IDR and VR.
SUBSIDIARIES & AFFILIATES: KEY RATING DRIVERS
Banco de Occidente Panama (BOP)
Support-Driven Ratings: BOP's IDRs are aligned to Occidente's as
they reflect the potential support it would receive from the
Colombian bank, if required. Fitch's view about ability to support
highly weighs Occidente's 'BB+' IDR and Negative Outlook. The
agency's support assessment is also highly influenced by BOP's key
role for Occidente's international strategy, contributing to
expanding the regional presence of its parent. The support
assessment also encompasses the relevant reputational risks and
high operational integration between BOP and Occidente.
Occidental Bank Barbados (OBB)
Shareholder Support Drives Ratings: OBB's national ratings are
driven by the potential support it would receive from Occidente, if
required. Fitch's view about ability to support highly weighs
Occidente's 'BB+' IDR and Negative Outlook. The agency's support
assessment is also highly influenced by OBB's key role for
Occidente's strategy by providing financial services to
international clients, contributing to the regional presence of its
parent. Reputational risks and high operational integration are
also considered. As OBB is domiciled in Barbados, Fitch also highly
weighs the country risks associated with Occidente's ability to
support, which explains the one-notch difference in the national
scale rating.
Fiduciaria de Occidente S.A. (Fiduoccidente)
Shareholder Support: Fiduoccidente's national ratings are support
driven and therefore are aligned to Occidente's ratings. In Fitch's
view, Fiduoccidente is a core subsidiary of Occidente's business
model and strategy, which constitutes a high propensity of either
direct or indirect support. A default from this entity would
constitute a high reputational risk to its parent.
SUBSIDIARIES AND AFFILIATES: RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
For BOP:
- IDRs would change if Fitch's assessment of its parent's ability
and/or willingness to support BOP changes;
- Any negative change in Occidente's IDR would result in a similar
action in BOP.
For OBB:
- National ratings would change if Fitch's assessment of its
parent's ability and/or willingness to support OBB changes;
- Any negative change in Occidente's national ratings would result
in a similar action in OBB.
For Fiduoccidente:
- National ratings would change if Fitch's assessment of its
parent's ability and/or willingness to support Fiduoccidente
changes;
- Any negative change in Occidente's national ratings would result
in a similar action in Fiduoccidente.
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
For BOP:
- IDRs would mirror a positive rating action in Occidente's IDRs.
For OBB:
- An improvement of Barbado's country risk reflected in a sovereign
rating upgrade.
For Fiduoccidente:
- Positive rating factors are not applicable as the national
ratings are already at the highest possible level.
VR ADJUSTMENTS
The VR of 'bb+' has been assigned above the 'bb' implied due to a
positive adjustment driven by the bank's business profile, which is
assessed at 'bb+'.
Public Ratings with Credit Linkage to other ratings
Occidente's SSRs are linked to its ultimate parent GA's ratings.
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
----------- ------ -----
Occidental Bank
(Barbados) Ltd. Natl LT AA+(col) Affirmed AA+(col)
Natl ST F1+(col) Affirmed F1+(col)
Banco de Occidente
(Panama), S. A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Shareholder Support bb+ Affirmed bb+
Fiduciaria de
Occidente S.A. Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Banco de
Occidente S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Viability bb+ Affirmed bb+
Shareholder Support bb+ Affirmed bb+
Subordinated LT BB- Affirmed BB-
BANCOLOMBIA S.A: Fitch Affirms 'BB+' Long-Term IDR, Outlook Neg.
----------------------------------------------------------------
Fitch Ratings has affirmed Bancolombia S.A.'s international and
national ratings, and those of related entities. Fitch affirmed
Bancolombia's Long-Term Foreign and Local Currency Issuer Default
Rating (IDRs) at 'BB+' and Short Term IDRs at 'B', and its
Viability Rating (VR) at 'bb+'. The Outlooks for the IDRs is
Negative. Fitch also affirmed the international and national
ratings for its holding company, Grupo Cibest S.A., other local and
foreign subsidiaries, and a related entity. The Rating Outlook of
the National-Long-Term Rating is Stable.
The Negative Outlook for the bank's IDRs reflects Fitch's March 6,
2025 revision of the Colombian sovereign's Outlook, as the bank is
constrained by the sovereign ratings given its intrinsic credit
profile.
Key Rating Drivers
Viability Rating Drives IDRs: Bancolombia's IDRs are driven by its
standalone creditworthiness, which is reflected in its 'bb+' VR.
The bank's VR considers Bancolombia's robust company profile,
underpinned by its leading market share within the Colombian
market, which results in consistent and ample total operating
income generation and strong financial profile. The recent change
in Bancolombia's corporate structure, which includes
deconsolidating its subsidiaries in Central America, could slightly
impact some financial ratios in the short term, but they will
remain aligned to Bancolombia's current ratings.
Gradual Operating Environment Recovery: Fitch expects the operating
environment (OE) for Colombian banks to remain stable, with
recovering credit growth despite macroeconomic challenges from
political uncertainty and government reforms. Although the
sovereign has a Negative Outlook, driven mainly by deteriorating
fiscal and public-debt dynamics, Fitch expects Bancolombia to
continue generating business volumes at acceptable risk levels,
given expectations that the Operational Risk Index (ORI) and GDP
per capita will remain broadly stable.
Leading Franchise in Colombia: Bancolombia is Colombia's largest
bank, with a strong market share of 27.8% by assets, 24.7% by gross
loas and 26.5% by deposits as of August 2025. Bancolombia's
consistently high total operating income generation, compares
favorably with local peers.
Recent changes to the group structure, including the creation of
Grupo Cibest and the deconsolidation of Central American
subsidiaries, could slightly affect the bank's size and total
operating income, but are unlikely to affect Fitch's current
assessment. Fitch will follow up on trends for the bank and the
group after this process.
Stable Asset Quality: Bancolombia's asset quality is supported by
its ample reserve coverage and relatively low credit costs coupled
with moderate concentration. The bank consolidated 90-days NPLs
remained stable at 3.4% as of June 2025 compared to YE 2024. Fitch
anticipates gradual improvement as the operating environment
becomes more favorable for lending, but headwinds persist as
political uncertainty and high interest rates weigh on investments
and lending. Metrics are expected to remain around 3.0%-3.5% in the
mdi-term.
Solid Profitability: Bancolombia's profitability is resilient and
has improved during 2025, supported by higher loan growth and lower
cost of risk, which offset declining margins. The core metric of
operating profit to risk-weighted assets improved to 3.9% as of
June 2025 from 3.1% at YE 2024, although the ratio was positively
affected by the deconsolidation in 2Q25. The bank's loan-impairment
charges to pre-impairment operating-profit declined to 28.7% at
June 2025, below the 2021-2024 average of 48.2%, reflecting less
credit-cost pressures expected to continue.
Modest Capitalization: Bancolombia's common equity Tier 1
(CET1)-to-RWA ratio declined slightly to 11.4% at June 2025 from
11.9% as of December 2024, but is in line with the 2021-2024
average. Bancolombia capitalization is supported by its strong
internal capital generation and moderate RWA growth. The bank's
ability to sustain this improvement is sensitive to its recurrent
dividend payment policy and loan-growth prospects.
Additionally, loan-loss absorption capacity is bolstered by
adequate reserve coverage. Fitch expects the metric to remain in
the 10.5%-11% range, above the bank's 10% appetite and consistent
with its current score. This ratio could be impacted from
higher-than-expected loan growth in 2026.
Sound Funding and Liquidity: Bancolombia's funding structure is
supported by its large and diversified deposit base, which accounts
for around 93% of its total funding, coupled with its presence in
local and global capital and debt markets. The bank's
loans-to-deposits ratio remains adequate, at 99.3% as of June
2025.
Fitch expects liquidity to remain sound for Bancolombia, reflecting
the benefits from having the largest deposit market share in the
country amid a higher expected loan growth. Fitch anticipates that
the favorable funding structure, specifically its large deposit
share, will continue to support the bank's contained funding costs,
thereby bolstering profitability.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Bancolombia's VRs and IDRs are sensitive to a material
deterioration in the local OE or a negative sovereign rating
action;
- The ratings could be downgraded due to a significant
deterioration in profitability and capital metrics, specifically if
the operating profit to RWA consistently falls below 1% and the
CET1 ratio drops below 10%, which would no longer align with its
strong business profile.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Given the Negative Outlook and the limitations of the OE, a
ratings upgrade is unlikely in the medium term for Bancolombia;
- Over the longer term, an improvement in the OE along with
improving capital metrics and a smooth transition after the
organizational changes could be positive for creditworthiness.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
The senior unsecured debt is rated at the same level as the bank's
national long term rating, as the probability of default is the
same as Bancolombia's.
The Tier II capital subordinated notes are rated two notches below
Bancolombia's VR of 'bb+' and national rating of 'AAA' and reflect
loss severity exclusively. There is no notching due to incremental
non-performance risk. These securities rank pari passu with other
existing subordinated indebtedness and the loss severity notching
is wider on the proposed notes due to a full write-down feature,
which is not contained in other outstanding subordinated debt.
The 'bb' Government Support Rating (GSR) reflects a moderate
probability of sovereign support, if required, given the bank's
systemic importance. The sovereign's ability to provide support is
based on its 'BB+' rating with a Negative Outlook.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
- The senior unsecured debt ratings will mirror any action on the
bank's National Long-Term rating.
- The subordinated debt ratings will mirror any action on the
bank's VR and National Long-Term rating.
- The subordinated debt ratings are sensitive to a change in
Bancolombia's VR or national Long-Term rating. The ratings are also
sensitive to a wider notching from the anchor rating if there is a
change in Fitch's view on the non-performance of these instruments
on a going concern basis, which is not the baseline scenario.
- Bancolombia's GSR would be affected by a positive/negative change
in Colombia's ability or willingness to support the bank.
SUBSIDIARIES & AFFILIATES: KEY RATING DRIVERS
Grupo Cibest S.A.
Creditworthiness of Strong and Diversified Subsidiaries: Cibest is
the Holding Company for Bancolombia and related entities, commonly
known as Grupo Bancolombia. Cibest directly consolidates
Bancolombia (main subsidiary), Banistmo (Panamanian bank),
Bancoagricola (El Salvatorian bank), BAM (Guatemalan bank), and
other non-financial entities. Fitch monitors the process of
incorporation and its evolution but Fitch anticipates that their
respective business profiles will remain unchanged under the new
structure.
Strong Group Profile: Cibest's rating are driven by the business
and financial profile of its main operating subsidiary, Bancolombia
rated 'BB+/Negative'. Bancolombia is the largest bank in Colombia
and possess a strong business and financial profile. The group also
has a footprint, of mostly banking operations, in Panamá,
Guatemala and El Salvador, among others, which further enhances its
profile. Fitch expects Cibest's cash flow to be sufficient and
consistent, coming mostly from Bancolombia in the form of
dividends.
Moderate Double Leverage: On an unconsolidated basis, Cibest's
double leverage ratio is moderate (105% at June 2025). While there
is room to increase double leverage while maintaining rating
equalization, the group does not plan to significantly increase
equity investments in its subsidiaries and Fitch expects this ratio
to remain below 110%. Fitch also expects Cibest's dividend flow
from its subsidiaries to be sufficient to maintain a moderate
double leverage ratio and effective coverage of its obligations.
Risk Profile Linked to Main Subsidiary: Around 70% of total
consolidated assets come from Bancolombia, and therefore their risk
profiles are highly linked. Fitch expects Cibest's liquidity
management to be prudent, relying on Bancolombia's structure and
practices and with a proper use of cash flows.
Bancolombia Panama, Bancolombia Puerto Rico, Compania De
Financiamiento Tuya, Fiduciaria Bancolombia, and Valores
Bancolombia
IDRs, National Ratings, and Senior Debt
The ratings of Bancolombia Panama SA (BP), Bancolombia Puerto Rico
Internacional Inc. (BPR), Compania de Financiamiento Tuya S.A.
(Tuya), Fiduciaria Bancolombia S.A. and Valores Bancolombia S.A.
(VB) reflect the potential support they would receive from
Bancolombia if required. Fitch views these entities as an integral
part of its parent's business model and core to its strategy;
therefore, their ratings mirror those of Bancolombia. Fitch also
incorporates in its support rationale the negative reputational
implications of a potential default of BP, BPR, Fiduciaria
Bancolombia and BV for the parent. In the case of Tuya, Fitch also
considers the support track record of the parent towards the
entity.
Shareholder Support Ratings
The SSR of 'bb+' for BP and BPR reflects moderate probability of
support being forthcoming because of uncertainties about the
ability or propensity of the potential provider of support to do
so. Fitch believes these entities are core to the parent's business
strategy and regional expansion. Bancolombia's ability to support
these entities is reflected in its 'BB+' IDR.
SUBSIDIARIES AND AFFILIATES: RATING SENSITIVITIES
Factors That Could, Individually Or Collectively, Lead To Negative
Rating Action/Downgrade
Grupo Cibest
- Cibest's IDRs could be downgraded if there is a significant and
sustained increase in double leverage above 120%. This would lead
to a rating one notch below Bancolombia's IDRs;
- A downgrade of Bancolombia will result in a similar action for
Cibest because the ratings are equalized.
- Although not an imminent risk, an increased contribution of
assets from subsidiaries with a riskier profile or a significant
deterioration in the current creditworthiness of its subsidiaries
could pose downside risks to Cibest's ratings.
BP, BPR, Tuya, Fiduciaria Bancolombia, and VB
IDRs and Senior Debt
- The IDRs and senior debt of BP and BPR are support-driven and
aligned with its parent's ratings, therefore, these ratings would
mirror any changes in Bancolombia's IDRs.
SSR
- BP and BPR's SSR would be affected if Fitch changes its
assessment of its parents' willingness and/or ability to provide
support.
Factors That Could, Individually Or Collectively, Lead To Positive
Rating Action/Upgrade
Grupo Cibest
- An upgrade of Cibest's IDRs would result from any positive change
in Bancolombia's ratings.
BP, BPR, Tuya, Fiduciaria Bancolombia, and VB
IDRs and Senior Debt
- The IDRs and senior debt of BP and BPR are support-driven and
aligned with its parent's ratings, therefore, these ratings would
mirror any changes in Bancolombia's IDRs.
Shareholder Support Rating (SSR)
- BP and BPR's SSR would be affected if Fitch changes its
assessment of its parents' willingness and/or ability to provide
support.
National Ratings
- The National Scale ratings of Tuya, Fiduciaria Bancolombia, and
VB are at the highest level on the national scale; therefore, they
cannot be upgraded.
Subordinated Debt
- Subordinated debt ratings will mirror any action on the entity's
national long-term rating.
Public Ratings with Credit Linkage to other ratings
Grupo Cibest, Bancolombia Panama, Bancolombia Puerto Rico, Compania
de Financiamiento Tuya, Fiduciaria Bancolombia and Valores
Bancolombia's ratings are driven by Bancolombia's ratings.
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, due to either 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
----------- ------ -----
Bancolombia
(Panama) S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
long-term
deposits LT BB+ Affirmed BB+
short-term
deposits ST B Affirmed B
Valores
Bancolombia S.A. Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Bancolombia S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Viability bb+ Affirmed bb+
Government Support bb Affirmed bb
subordinated LT BB- Affirmed BB-
senior
unsecured Natl LT AAA(col) Affirmed AAA(col)
subordinated Natl LT AA(col) Affirmed AA(col)
Compania de
Financiamiento
Tuya S.A. Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
subordinated Natl LT AA(col) Affirmed AA(col)
Fiduciaria
Bancolombia S.A. Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Grupo Cibest S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Bancolombia
Puerto Rico
Internacional
Inc. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
CORPORACION FINANCIERA: Fitch Affirms 'BB+' LT IDR, Outlook Neg.
----------------------------------------------------------------
Fitch Ratings has affirmed Corporacion Financiera Colombiana S.A.'s
(Corficolombiana) international and national ratings, Viability
Rating (VR) at 'bb+' and Long-Term Foreign- and Local-Currency
Issuer Default Ratings (IDRs) at 'BB+'. The Rating Outlook on the
LT IDRs is Negative.
Fitch also affirmed Corficolombiana's Long- and Short-Term National
Ratings at 'AAA(col)' and 'F1+(col),' respectively, and the
long-term national rating on its senior unsecured debt at
'AAA(col)'. The Rating Outlook on the National Long-Term Rating is
Stable.
Key Rating Drivers
IDRs Driven by VR: Corficolombiana's IDRs are driven by its VR,
which reflects its strong business profile. The ratings also
reflect Corficolombiana's stable financial profile. Under Fitch's
current assessment, Corficolombiana's IDRs will likely remain at
the level determined by its own VR or at the same level as its main
shareholder and controlling company, whichever is higher.
Gradual Operating Environment Recovery: Fitch expects the operating
environment (OE) for Colombian banks to remain stable, with credit
growth continuing to recover despite ongoing macroeconomic
challenges from political uncertainty and government reforms.
Although the sovereign rating has a Negative Outlook, driven
primarily by deteriorating fiscal and public-debt dynamics, Fitch
expects Corficolombiana to continue generating business volumes at
acceptable risk levels, given expectations that the Operational
Risk Index (ORI) and GDP per capita will remain broadly stable.
Strong Business Profile: Corficolombiana is an investment-holding
company that controls or holds significant interests in various
companies in Colombia and abroad. The entity's equity investment
policy is focused on low-risk, consistent dividend-generating
companies. Corficolombiana's profitability and capital metrics have
been sound, despite challenges in the OE. The business profile
score of 'bbb-' is assigned above its implied 'bb' score given its
strong income generation, with a four-year average total operating
income (TOI) of USD 2,350 million, which compares with the largest
banks in the system.
Exposure from Capital Investments: Corficolombiana's main asset
exposure comes from its capital investments, since assets related
to concession contracts are the most important for the corporation,
representing 53.6% of total assets. This figure includes both
financial and intangible associated with concessions. The
investments are concentrated by industry but diversified by
company, and as of 2Q25, have shown adequate performance.
Improvements in Profitability: Corficolombiana maintained solid
profitability in 1H25, supported by lower funding costs, reduced
debt, and improved treasury operations. These factors contributed
to stronger profitability, with operating income to Risk-Weighted
Assets (RWAs) improving to 8.1% in 1H25, up from 5.6% at YE 2024.
In 2024, the completion of major 4G road projects marked the end of
a high-profitability cycle, resulting in lower accounting income
compared to 2023. With no new large-scale projects currently
underway, profitability metrics have moderated. However, cash flows
are improving as existing projects transition into their
operational phases.
Business Segment Performance Mixed: Infrastructure remained stable
and continued to generate recurring income, while energy and gas
declined due to lower thermal demand and climate normalization.
Tourism continued to recover, and agribusiness faced
weather-related challenges, leading to losses. The financial
segment benefited from structural adjustments and cost
efficiencies, particularly due to the exclusion of Fiduciaria and
Casa de Bolsa from the balance sheet, which helped reduce
operational and financial expenses. Fitch expects profitability
levels to remain relatively stable in the medium term.
Stable Capitalization and Leverage: Corficolombiana has
historically maintained moderate leverage; consolidated equity to
assets ratio has historically been near to 30% (2Q25: 27.7%),
showing stability during economic cycles. Regarding capitalization,
Corficolombiana's CET1 ratio was 46.68% and remains high. Fitch
considers this adequate, given its business model. Fitch expects
Corficolombiana's capitalization levels to remain robust, with a
CET1 ratio near 50%.
Funding Structure Aligned with Business Model: Corficolombiana's
funding primarily comes from long-term financial obligations,
including loans from both domestic and international financial
institutions to support infrastructure projects. These represent
26.8% of total liabilities as of 1H25. Customer deposits, mostly
term deposits (85%), account for 19.9% of total liabilities.
Additional funding sources include senior unsecured debt issuances
(13.5%) and sell/buy-back and reverse repo liabilities (12.1%).
Usual counterparties include pension funds, insurance companies,
financial institutions, and large corporate treasury departments.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Under Fitch's current support assessment, Corficolombiana's IDR
will likely remain at the level determined by its VR, or at the
same level as its main shareholder and its controlling company,
whichever is higher
- Corficolombiana's VR is sensitive to any rating action on
Colombia's sovereign ratings or a material deterioration in the
local OE.
However, if the VR is downgraded, the entity's IDRs could become
support-driven and remain equalized to that of its main
shareholder, given Fitch's "higher of" approach and the assessment
of the subsidiary as being core for Grupo Aval. In the latter case,
the Rating Outlook or Watch would mirror that of the parent.
- Corficolombiana's Shareholder Support Rating (SSR) would be
affected if Fitch changes its assessment of the parent's
willingness and/or ability to provide support.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Under Fitch's current support assessment, Corficolombiana's IDR
will likely remain at the level determined by its VR, or at the
same level as its main shareholder and its controlling company,
whichever is higher.
- There is limited upside potential for Corficolombiana's ratings,
given the sovereign's current ratings and Outlook.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
Corficolombiana's senior unsecured obligations are rated at the
same level than the bank's long-term national-scale rating.
The Corficolombiana's SSR of 'bb+' reflects its importance to the
strategy and business of the ultimate controlling company Grupo
Aval Acciones y Valores S.A. and its main shareholder Banco de
Bogota S.A. Fitch's believes support for Corficolombiana would come
from its main shareholder. Its ability to support Corficolombiana
is reflected in its 'BB+'/Negative rating.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
- Corficolombiana senior unsecured obligations will mirror any
changes on its long-term national scale rating.
VR ADJUSTMENTS
The VR has been assigned below the implied VR due to the following
adjustment reason(s): Operating Environment/Sovereign Constraint
(negative);
The Business Profile score has been assigned above the implied
score due to the following adjustment reason(s): Business Model
(positive);
The Funding and Liquidity score has been assigned below implied
score due to the following adjustment reason: Deposit Structure
(negative).
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
----------- ------ -----
Corporacion
Financiera
Colombiana S.A.
(Corficolombiana) LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Natl LT AAA(col) Affirmed AAA(col)
Natl ST F1+(col) Affirmed F1+(col)
Viability bb+ Affirmed bb+
Shareholder Support bb+ Affirmed bb+
senior
unsecured Natl LT AAA(col) Affirmed AAA(col)
=====================
E L S A L V A D O R
=====================
EL SALVADOR: IDB OKs $195MM-Loan to Modernize Int'l Airport
-----------------------------------------------------------
The Inter-American Development Bank (IDB) Board of Executive
Directors has approved a $195 million loan to finance the
modernization of El Salvador International Airport (AIES).
This operation, approved under the Specific Investment Loan (ESP)
modality, will boost the country's economic development, tourism,
and air connectivity for passengers using the San oscar Arnulfo
Romero y Galdámez International Airport.
The plan aims to improve the quality of airport services and
strengthen institutional capacity for planning, operating, and
managing air transport.
This IDB-supported program is part of its América en el Centro
initiative and contributes to implementing the productivity and
economic integration pillar through the development of sustainable
regional infrastructure. It will directly benefit 7.7 million
passengers expected to use the new airport infrastructure annually
by 2030 and generate benefits for more than 518,000 people directly
or indirectly linked to tourism, as well as for over 1.8 million
people indirectly.
Currently, El Salvador has opportunities to improve its air
connectivity, which, if strengthened, would enhance competitiveness
and boost tourism growth. A modern, efficient, and well-connected
airport system would open new possibilities to fully leverage the
economic and social benefits offered by this sector.
The country's air connectivity is concentrated almost entirely at
AIES, which currently handles 99.8% of operations and all
international flights. This scenario represents a valuable
opportunity to strengthen the quality of airport services and
enhance the planning, management, and operational capacities of the
Autonomous Port Executive Commission (CEPA), thus driving more
dynamic and sustainable development of air transport in the
country.
The program includes the construction of the second phase of the
passenger terminal expansion, as well as the expansion of the
aircraft apron at AIES. It will also include the construction of a
Foxtrot taxiway, a vehicle parking building, and a Rescue and
Firefighting Service (RFFS) building.
The $195 million loan has a repayment term of 23 years, a grace
period of 7.5 years, and an interest rate based on SOFR.
=============
J A M A I C A
=============
MEDICAL DISPOSABLES: Shrinks Net Loss to $28.5 Million in Q2
------------------------------------------------------------
RJR News reports that the directors of Medical Disposables (MDS)
and Supplies are reporting a net loss of $28.5 million on revenues
of $1 billion during its second quarter which ended on September
30, 2025.
This was a big improvement when compared with the net loss of $49.9
million recorded on revenues of $907.7 million during the same
period of the previous year, according to RJR News.
The company also says that this big improvement was due to an
increase in its operational efficiency and cost management, while
stressing that this will continue going forward with the rollout of
a new human resource management system, the report notes.
It, however, stressed that these improvements will be disrupted by
the devastation caused by Hurricane Melissa in western Jamaica,
which accounts for 31% of its business, the report adds.
===========
M E X I C O
===========
BRASKEM IDESA: Fitch Lowers Local & Foreign Currency IDRs to 'CC'
-----------------------------------------------------------------
Fitch Ratings has downgraded Braskem Idesa SAPI's Long-Term Local
and Foreign Currency Issuer Default Ratings (IDRs) to 'CC' from
'CCC+'. Fitch also downgraded Braskem Idesa's senior secured bonds
to 'CC' with a Recovery Rating of 'RR4' from 'CCC+'/'RR4'.
The downgrades reflect Fitch's view that there is a high
probability Braskem Idesa will miss the interest payment due Nov.
15, 2025. The company has not made the payment and is likely to
enter the five-day cure period next week. Braskem Idesa has not
publicly disclosed alternatives.
Fitch expects the issuer to enter the cure period, which Fitch
defines as a default-like process, and to result in a downgrade to
'C'.
Key Rating Drivers
Probable Event of Default: Fitch views it as almost certain that
Braskem Idesa will miss the interest payment due Nov. 15, 2025, and
enter the cure period. This increases the probability of an event
of default if the company does not generate cash flow to cover the
payment through the cure period. Fitch previously commented on
heightened restructuring risk for Braskem Idesa after the company
engaged Lazard and other financial and legal advisors, firms
frequently involved in past restructurings, signaling potential
restructuring or other debt actions that could harm investors.
Peer Analysis
Fitch's calculation of Braskem Idesa's expected net leverage at YE
2025 was 22.4x above peers: Braskem S.A.
(CCC+) exceeding 10.0x, Orbia Advance Corporation, S.A.B. de C.V.
(BBB-/Stable) at 3.0x, Cydsa, S.A.B. de C.V. (BB+/Stable) at 2.3x,
and Alpek, S.A.B. de C.V. (BBB-/Negative) at 3.1x.
Historically, Braskem Idesa benefited from competitive feedstock
costs, with EBITDA margins positioned well relative to other PE
producers, such as Braskem S.A., and more diversified participants,
such as Dow, on operating margins. Braskem Idesa has higher
exposure to supply and contract risks than peers. The company also
has a weaker position due to single-asset and product and
single‑product exposure.
Key Assumptions
- Pemex provides 20kbpd in 2025, 20kbpd in 2025 and 2026 and 15kbpd
thereafter;
- Operating rates of 72% in 2025, 81% in 2025 and 95% in 2026
onwards;
- Braskem Idesa PE prices of USD1,116/ton in 2025 and USD1,126/ton
in 2026;
- Average ethane purchase costs of USD325/ton in 2025 and
USD314/ton in 2026;
- Braskem Idesa PE-ethane spreads of USD781/ton in 2025 and
USD812/ton in 2026;
- Braskem Idesa earns an 10% service margin over the industry
reference PE price;
- The ethane import terminal begins operations in 3Q 2025 and
operates at a rate of 45kbpd, lowering cost to USD190/ton;
- MXN/USD exchange rates of 19.95 in 2025 and 20.27 in 2026.
Recovery Analysis
The recovery analysis for Braskem Idesa assumes a liquidation
approach to valuation.
Liquidation Approach Inputs:
- MXN1,700 million of inventory valued at 50%;
- MXN29,400 million of PP&E valued at 50%;
- Total liquidation value USD31,240 million;
- A 10% administrative claim.
With these assumptions, Fitch's waterfall generated recovery
computation (WGRC) for the senior secured notes is in the 'RR3'
band. However, according to Fitch's Country-Specific Treatment of
Recovery Ratings Criteria, the Recovery Rating for corporate
issuers in Mexico is capped at 'RR4'.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- Failure to meet interest payment;
- A Fitch-defined default process has commenced;
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
Fitch does not anticipate an upgrade in the near term due to the
company's elevated leverage;
- Timely servicing of debt obligations avoiding an event of
default;
- Medium-term, positive actions are possible if net debt/EBITDA are
sustained below 4.5x;
- EBITDA/ Interest coverage above 3.0x;
- Positive (CFO-Capex)/Debt ratio;
- Securing funding to stabilize medium-term liquidity.
Liquidity and Debt Structure
Braskem Idesa reported cash of USD100 million and total debt of
USD2.2 billion as of June 30, 2025. Fitch estimates the company had
USD60 million of cash available as of end of August 2025. The
majority of the company's debt consists of a USD900 million bond
due 2029 and a USD 1.2 billion bond due 2032, evidencing a
favorable debt maturity schedule. In April 2025, Braskem Idesa
refinanced its US$95 million term loan, extending the bullet
amortization to 2029.
Issuer Profile
Braskem Idesa, S.A.P.I. is a polyethylene producer with operations
in the city of Coatzacoalcos, Mexico. Its annual production is 1.05
million tons of high- and low-density polyethylene. It began
operations in early 2016.
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
Braskem Idesa SAPI has an ESG Relevance Score of '4' for Governance
Structure due to shareholder concentration, which has a negative
impact on the credit profile, and is relevant to the rating[s] in
conjunction with other factors.
Braskem Idesa SAPI has an ESG Relevance Score of '4' for Financial
Transparency due to lack of footnotes and adequate disclosures,
which has a negative impact on the credit profile, and is relevant
to the rating[s] in conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Braskem Idesa SAPI LT IDR CC Downgrade CCC+
LC LT IDR CC Downgrade CCC+
senior secured LT CC Downgrade RR4 CCC+
=====================
P U E R T O R I C O
=====================
PET HOTELS: Files Amendment to Disclosure Statement
---------------------------------------------------
Pet Hotels LLC submitted an Amended Disclosure Statement describing
its Amended Plan of Reorganization dated November 6, 2025.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income after the sale of the Corozal
commercial property of $1,960.00. The remaining amount shall stem
from the sales of the North Carolina commercial property.
The final Plan payment is expected to be paid before 60 months from
the filing of the bankruptcy petition, which was June 10, 2025.
The Debtor projects that all debts will be paid within 60 months.
The Debtor shall place one of the Puerto Rico commercial properties
for sale valued at $217,000.00 to allow for the payment of
outstanding mortgage payments, in the amount of $130,000.00 as
adequate protection, in addition to creating and investment fund
for future operations.
The Debtor shall sell the North Carolina commercial property and
liquidate the remaining secured debt with creditor, Alfie
Investors. The sale of the property located in Asheville, North
Carolina, will be done within a term of 12 months, by June 12,
2026. The remaining debts shall be paid within the 60-month period
from the date of the filing of the petition, statutory liens to be
paid in full.
This Plan of Reorganization proposes the payment of adequate
protection in the amount of $130,000.00 to creditor, Alfie
Investors, from the sale of commercial real estate property located
in Corozal, Puerto Rico, to pay secured creditor arrears. The
Debtor
shall liquidate the debt with secured creditor, Alfie
Investors, by June 10, 2026. The remaining creditors shall be paid
within 60 months from the date of the filing of the bankruptcy
petition.
There are no non-priority claims. This Plan also provides for the
payment of administrative and priority claims.
A full-text copy of the Amended Disclosure Statement dated
November
6, 2025 is available at https://urlcurt.com/u?l=vMZngO from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Robert Millan, Esq.
ROBERT MILLAN
Calle San Jose No. 250
San Juan, PR 00901
Tel: (787) 725-0946
Fax: (787) 725-0946
E-mail: rmi3183180@aol.com
About Pet Hotels LLC
Pet Hotels LLC operates in the area of real estate and investment.
The Debtor filed its voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. D.P.R. Case No. 25-02627) on June
10, 2025. At the time of filing, the Debtor estimated $1,000,001 to
$10 million in both assets and liabilities.
Robert Millan, Esq., at Millan Law Offices, serves as the Debtor's
bankruptcy counsel.
*********
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