/raid1/www/Hosts/bankrupt/TCRLA_Public/250318.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, March 18, 2025, Vol. 26, No. 55
Headlines
A R G E N T I N A
ARGENTINA: Inflation in Buenos Aires City Slowed to 2.1% in Feb
ARGENTINA: Locals Ditch Dining out as Policies Strengthen Peso
GAUCHO GROUP: Seeks to Hire Alvarez & Marsal as Appraisal Expert
C H I L E
WOM MOBILE: Fitch Affirms Long-Term IDR at 'D'
C O L O M B I A
BOGOTA: Fitch Affirms 'BB+' IDRs, Alters Outlook to Neg.
GRUPO SURA: Fitch Affirms 'BB+' Long-Term IDR, Outlook Negative
[] Fitch Alters Outlook on Colombian Banks Ratings to Negative
J A M A I C A
JAMAICA: BOJ Acknowledges Multilaterals for Supporting Econ. Gains
P U E R T O R I C O
ORION SECURITY: Case Summary & 20 Largest Unsecured Creditors
S T . L U C I A
ST. LUCIA: GDP Growth is Expected at 3.7%, IMF Says
- - - - -
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A R G E N T I N A
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ARGENTINA: Inflation in Buenos Aires City Slowed to 2.1% in Feb
---------------------------------------------------------------
Buenos Aires Times reports that consumer prices in the nation's
capital rose 2.1 percent in February – slowing more than one
percentage point in a month.
Inflation in Buenos Aires City dropped to 2.1 percent from 3.1
percent in January, meaning prices have increased 5.3 percent in
the first two months of the year, according to Buenos Aires Times.
Year-on-year, prices have increased 79.4 percent, according to data
published by City Hall's statistics bureau, the report notes.
Inflation in the nation's capital is often a precursor to the
national figure, which is due to be released in the INDEC national
statistics bureau, the report relays.
The positive outcome in the City will boost hopes in President
Javier Milei's government that the national figure will be close to
the 2.2 percent recorded in January, the report discloses.
February's slowing of consumer prices in the capital was down to
slower increases in the price of services, although significant
rises were seen in food and non-alcoholic beverages (up 2.5
percent), the report says. In particular, thanks to meat and meat
products (7.7 percent), milk, dairy products and eggs (1.4
percent), and bread and cereals (one percent), the report notes.
Housing and utilities rose 3.1 percent, propelled by soaring rent
prices, with healthcare up three percent, the report discloses.
By category, goods rose 1.9 percent, while services advanced 2.1
percent, 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 new
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). The IMF Executive Board's decision
allowed the authorities an immediate disbursement of an equivalent
of US$9.65 billion in March 2022.
Argentina's IMF-supported program seeks to improve public finances
and start to reduce persistent high inflation through a
multi-pronged strategy, involving a gradual elimination of monetary
financing of the fiscal deficit and enhancements in the monetary
policy framework.
In June 2024, the IMF Board completed an eighth review of the
Extended Arrangement under the Extended Fund Facility for
Argentina. The IMF Board's decision enabled a disbursement of
around US$800 million to support the authorities' efforts to
entrench the disinflation process, rebuild fiscal and external
buffers, and underpin the recovery.
On Feb. 17, 2025, S&P Global Ratings lowered its local currency
sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and
its national scale rating to 'SD' from 'raB+'. At the same time,
S&P affirmed its 'CCC/C' foreign currency sovereign credit ratings
on Argentina. The outlook on the long-term foreign currency rating
remains stable.
On Jan. 8, 2025, Moody's Ratings raised Argentina's local currency
ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1
from Caa3. Moody's said the decision to raise the local and
foreign currency ceilings reflects the increased predictability and
the greater consistency in economic policy that has led to a rapid
reduction in monetary and fiscal imbalances that were stoking very
high inflation.
On Nov. 15, 2024, Fitch Ratings upgraded Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'CCC' from 'CC',
and its Long-Term Local-Currency IDR to 'CCC' from 'CCC-'.
Argentina's upgrade to 'CCC' from 'CC' reflects developments that
have improved Fitch's confidence in the authorities' ability to
make upcoming foreign-currency bond payments without seeking relief
of some sort.
DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local
Currency Issuer Ratings to B (low) from CCC on November 25, 2024.
The trend on all ratings is Stable.
ARGENTINA: Locals Ditch Dining out as Policies Strengthen Peso
--------------------------------------------------------------
Buenos Aires Times reports that in Javier Milei's Argentina,
cooking at home never made more sense.
The president's self-titled "shock therapy" of economic policies
are making the country's currency so expensive it's doubled dinner
tabs at restaurants that boomed not so long ago when bargain prices
defined nightlife in Buenos Aires, according to Buenos Aires Times.
Those times, driven by unsustainable policies that pushed
Argentina toward the brink of a full-blown crisis, are gone since
Milei took office more than a year ago, the report notes.
It's one of the most tangible changes to life in Argentina, a
country famous for packed steakhouses by day, buzzing bistros by
night and dance clubs that don't open until 2am, the report says.
Locals and foreigners alike are cutting back on going out as
Milei's policies have paved the way for the world's second most
expensive Big Mac (US$7) and Latin America's priciest cup of coffee
(US$3.50), the report discloses.
Years of high inflation and currency controls gave Argentines the
feeling that spending pesos quickly was more rational than saving,
the report relays. But in 2024, the Argentine peso was one of the
five best-performing currencies around the world when adjusted for
inflation, gaining more than 40 percent against the US dollar,
according to data compiled by Bloomberg, the report notes.
Milei scrapped price controls that kept food costs artificially
low, but he tightened government controls on currency trading and,
in the process, strengthened the peso so much that many economists
say it's now overvalued, the report discloses. He's also scrapping
some subsidies on utilities, forcing restaurants to pass on the
cost of price hikes on electricity, gas and water, going as high as
50 percent in the past year, the report says.
While restaurant prices are up 100 percent from a year ago, grocery
tabs have only gone up 65 percent, below headline inflation, the
report notes. Even on a monthly basis, the cost of eating out rose
three times compared with bills at supermarkets and fruit stands in
January, the report discloses. Although Argentines know inflation
all too well, the difference this time is that prices go up while
the exchange rate stays nearly flat, the report says.
Before Milei took office, high inflation and a big gap between
Argentina's many exchange rates meant that pesos were rapidly
losing value, fuelling a culture of fast spending and fierce
competition for reservations between locals and foreigners, the
report notes.
Now there's a much smaller gap between exchange rates, an
improvement that foreign investors welcome but it wipes out the
dinner tab discount savvy consumers enjoyed, the report relays.
And while price increases are cooling, menus have become much more
expensive in dollar terms, the report says.
With the peso no longer in free fall, households are cutting back
on discretionary spending, and restaurant owners are feeling the
impact, the report discloses. Argentina has lost more than 10,000
restaurant and hotel jobs since Milei took office, according to
government data, the report says.
Argentines spent US$645 million on payments abroad in January, the
highest since 2018, according to the country's Central Bank, the
report notes. Nearly two million Argentines travelled out of their
home country that month, more than triple the number of foreign
tourists who visited Argentina and up 73 percent from a year ago,
according to government data, the report discloses.
Restaurateurs point out that the previous government's economic
policies created a facade of world class meals for US$30 a person,
surreal prices for some of country's most famous restaurants, the
report says.
"We were coming from rock bottom prices. That was an extreme
situation," says Blanco, the restaurant owner, the report notes.
"Meat is still cheap relative to the rest of the world. It had to
level out a bit," he added.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
In March 2022, the International Monetary Fund (IMF) approved a new
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). The IMF Executive Board's decision
allowed the authorities an immediate disbursement of an equivalent
of US$9.65 billion in March 2022.
Argentina's IMF-supported program seeks to improve public finances
and start to reduce persistent high inflation through a
multi-pronged strategy, involving a gradual elimination of monetary
financing of the fiscal deficit and enhancements in the monetary
policy framework.
In June 2024, the IMF Board completed an eighth review of the
Extended Arrangement under the Extended Fund Facility for
Argentina. The IMF Board's decision enabled a disbursement of
around US$800 million to support the authorities' efforts to
entrench the disinflation process, rebuild fiscal and external
buffers, and underpin the recovery.
On Feb. 17, 2025, S&P Global Ratings lowered its local currency
sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and
its national scale rating to 'SD' from 'raB+'. At the same time,
S&P affirmed its 'CCC/C' foreign currency sovereign credit ratings
on Argentina. The outlook on the long-term foreign currency rating
remains stable.
On Jan. 8, 2025, Moody's Ratings raised Argentina's local currency
ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1
from Caa3. Moody's said the decision to raise the local and
foreign currency ceilings reflects the increased predictability and
the greater consistency in economic policy that has led to a rapid
reduction in monetary and fiscal imbalances that were stoking very
high inflation.
On Nov. 15, 2024, Fitch Ratings upgraded Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'CCC' from 'CC',
and its Long-Term Local-Currency IDR to 'CCC' from 'CCC-'.
Argentina's upgrade to 'CCC' from 'CC' reflects developments that
have improved Fitch's confidence in the authorities' ability to
make upcoming foreign-currency bond payments without seeking relief
of some sort.
DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local
Currency Issuer Ratings to B (low) from CCC on November 25, 2024.
The trend on all ratings is Stable.
GAUCHO GROUP: Seeks to Hire Alvarez & Marsal as Appraisal Expert
----------------------------------------------------------------
Gaucho Group Holdings, Inc. seeks approval from the U.S. Bankruptcy
Court for the Southern District of Florida to employ Alvarez &
Marsal Valuation Services, LLC as valuation and appraisal experts.
The firm will render these services:
a. provide valuation of its real and personal property that is
subject to the disputed security agreement and UCC-1 financing
statement;
b. prepare a valuation report for its real and personal
property; and
c. provide testimony regarding the valuation in this matter.
The firm's professionals will be paid at these hourly rates:
Managing Director $600
Senior Director $505
Director $420
Manager $370
Senior Associate $320
Associate $240
The firm received a retainer in the amount of $10,000.
Steven J. Kurtz, a managing director at Alvarez & Marsal, disclosed
in a court filing that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Steven J. Kurtz, CRE
Alvarez & Marsal Valuation Services, LLC
600 Madison Avenue, 8th Floor
New York, NY 10022
About Gaucho Group Holdings, Inc.
Gaucho Group Holdings Inc operates as a holding company. The
Company, through its subsidiaries, provides luxury real estate and
consumer marketplace with collection of wine, hospitality, fashion
brands, and real estate holdings. Gaucho Group Holdings serves
customers in the United States and Argentina.
Gaucho Group Holdings Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Fl. Case No. 24-bk-21852) on
November 12, 2024. At the time of filing, the Debtor estimated
$10,000,001 to $50 million in both assets and liabilities.
Judge Laurel M Isicoff handles the case.
Nathan G Mancuso, Esq. at Mancuso Law, P.A. represents the Debtor
as counsel.
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C H I L E
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WOM MOBILE: Fitch Affirms Long-Term IDR at 'D'
----------------------------------------------
Fitch Ratings has affirmed WOM Mobile S.A.'s (WOM) Long-Term Local
and Foreign Currency Issuer Default Rating (IDR) at 'D'. Fitch has
also affirmed the 2024 and 2028 unsecured U.S.-dollar-denominated
bonds issued by Kenbourne Invest S.A. at 'C' and revised the
Recovery Rating to 'RR4' from 'RR5'. The 'D' rating indicates that
WOM is currently undergoing debt reorganization as part of Chapter
11 proceedings. The 'C' debt rating reflects weak recovery
expectations, and the change in the Recovery Rating reflects the
revised going concern EBITDA estimate.
A debt restructuring agreement and new money infusion has recently
been approved by the U.S. Bankruptcy Court in the District of
Delaware. As part of this process, WOM's balance sheet will be
restructured, resulting in substantial changes to the amount terms
and conditions of its debt.
Key Rating Drivers
Debt Restructuring Agreement Approved: WOM previously announced an
agreement with an ad hoc group of noteholders (AHG) holding 60% of
the company's existing unsecured notes to restructure its financial
debt. The agreement includes the extinguishment of WOM's USD650
million of existing unsecured notes in exchange for USD225 million
in senior secured notes (due in 2031) and 100% of the reorganized
company's common shares (on a non-fully diluted basis), with a
recovery estimated at 43%-46% according to the disclosure statement
approved by the creditors.
Also, the agreement includes a USD500 million rights offering fully
backstopped by the AHG, including USD405 million in convertible
bonds with a seven-year term and USD95 million in senior secured
notes (due in 2031). The current consolidated financial debt of WOM
is USD981 million, excluding lease obligations of USD550 million.
The restructuring plan was recently voted and approved by more than
two-thirds of the creditors (by value) in each creditor class.
Fitch expects the company to complete this process and emerge from
Chapter 11 by the end of March.
Chapter 11 Process: On April 1, 2024, WOM announced that it had
voluntarily filed for Chapter 11 reorganization under the U.S.
Bankruptcy Code in the District of Delaware. The company has USD210
million of debtor-in-possession (DIP) financing from JPMorgan Chase
& Co. (AA-/Stable), which will be fully repaid as part of the
reorganization plan. The Chapter 11 process follows delays in
refinancing its 2024 notes amid difficult credit market conditions,
weak liquidity and negative free cash flow.
Recovery Analysis
Fitch's criteria employ bespoke recovery analysis for issuers with
IDRs of 'B+' and below. The bespoke recovery analysis assumes that
WOM would be considered a going concern in bankruptcy and that the
company would be reorganized rather than liquidated.
WOM's going concern EBITDA of CLP125 billion is based on Fitch's
expectation of a sustainable, post-reorganization EBITDA level. It
reflects the high levels of competition in the Chilean mobile
market and the company's limited financial flexibility. Fitch
applied an enterprise value/EBITDA multiple of 4.0x. This figure
reflects WOM's limited scale and the highly competitive environment
in Chile.
Fitch applies a waterfall analysis to the post-default enterprise
value based on the relative claims of debt in the capital
structure. The debt waterfall assumptions consider the company's
pre-restructuring financial debt including the DIP financing. These
assumptions result in a Recovery Rating of 'RR4' for senior
unsecured debt.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- As the company is rated 'D', there can be no negative rating
action for the IDR.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Positive rating action will occur when the proposed debt
restructuring process is announced and executed.
Issuer Profile
WOM Mobile S.A. is a Chilean telecommunications provider whose
primary business is the provision of mobile services. WOM is the
third-largest mobile player in the market and the second-largest
player in the mobile broadband segment.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The 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
----------- ------ -------- -----
WOM Mobile S.A. LT IDR D Affirmed D
LC LT IDR D Affirmed D
Kenbourne Invest S.A.
senior unsecured LT C Affirmed RR4 C
===============
C O L O M B I A
===============
BOGOTA: Fitch Affirms 'BB+' IDRs, Alters Outlook to Neg.
--------------------------------------------------------
Fitch Ratings has revised the Rating Outlooks on the Long-Term
Foreign and Local-Currency Issuer Default Ratings (IDRs) of two
Colombian local and regional governments (LRGs), Bogota, Capital
District of Colombia and City of Medellin, to Negative from Stable.
Fitch has also affirmed the IDRs at 'BB+'.
Key Rating Drivers
The revision of the Outlook on the Colombian LRGs reflects the
revision of the sovereign's Outlook to Negative from Stable on
March 6, 2025 (see: "Fitch Revises Colombia's Outlook to Negative;
Affirms at 'BB+'".
Colombian LRGs are subject to decisions of the central government
that influences their finances and responsibilities, and for this
reason they cannot be rated above the sovereign (BB+/Negative).
The LRGs' other key rating drivers are unchanged, as are the
Standalone Credit Profiles (SCPs). For other key rating drivers see
the previous published rating action commentary for each LRG.
Derivation Summary
Bogota's SCP of 'bbb-' results from a combination of 'Low Midrange'
risk profile and a debt sustainability score at the lower end of
the 'aa' category. The latter is derived from a payback ratio near
the middle of the 'aa' category range and a relatively weaker
synthetic debt service coverage ratio in the 'bbb' range. Bogota's
IDRs are capped by the sovereign.
Medellin's IDRs are based on its SCP, which is assessed at 'bb+',
reflecting a combination of a 'Low Midrange' risk profile and
financial profile score assessed as 'a' under Fitch's rating case.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- A negative action on the sovereign would be reflected in the LRGs
ratings.
For entity's specific negative sensitivities, please see each
individual rating action commentary.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- A revision of the sovereign Outlook to Stable would be reflected
in the LRGs Outlooks, all other factors being equal.
Public Ratings with Credit Linkage to other ratings
The LRGs' Outlooks are influenced by the Colombian sovereign
Outlooks. Additionally, the ratings of Bogota are capped by the
sovereign.
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
----------- ------ -----
City of Medellin LT IDR BB+ Affirmed BB+
LC LT IDR BB+ Affirmed BB+
Bogota, Distrito
Capital LT IDR BB+ Affirmed BB+
LC LT IDR BB+ Affirmed BB+
senior unsecured LT BB+ Affirmed BB+
GRUPO SURA: Fitch Affirms 'BB+' Long-Term IDR, Outlook Negative
---------------------------------------------------------------
Fitch Ratings has affirmed Grupo de Inversiones Suramericana S.A.'s
(Grupo Sura) Long-Term Foreign and Local Issuer Default Ratings
(IDRs) at 'BB+' and removed the Rating Watch Evolving. Fitch also
affirmed the senior unsecured notes at 'BB+' with a Recovery Rating
of 'RR4'. The rating action follows the non-bank financial
institutions assessment of its credit profile, using a criteria
approach for investment companies. The Rating Outlook is Negative.
Fitch also has affirmed Grupo Sura's National Long-Term Rating at
'AAA(col)' with a Stable Outlook and National Short-Term Rating at
'F1+(col)'.
The Negative Outlook of Grupo Sura's IDRs mirrors the recent rating
action on the Colombian sovereign ratings. Please see "Fitch
Revises Colombia's Outlook to Negative; Affirms IDR at 'BB+',"
dated March 6, 2025, available on www.fitchratings.com.
Grupo Sura's operational concentration mainly in Colombian banking
and insurance sectors inherently links its credit profile to the
sovereign rating of Colombia. Fitch believes any sovereign
downgrade would likely have direct implications on the group's
financial stability and performance. The national ratings maintain
a Stable Outlook as they are not directly impacted; these ratings
reflect the relative strengths and weaknesses of each institution
in a specific jurisdiction, which has not changed.
Fitch has also affirmed Sura Asset Management S.A.'s (Sura AM)
Long-Term Foreign and Local Currency IDRs at 'BBB' with a Stable
Outlook and the Short-Term Foreign and Local Currency IDRs at 'F3'.
The Stable Outlook incorporates Sura AM's business model, which
reflects the geographic diversity of its activities and the lack of
direct credit linkage to the Colombian sovereign. Its ratings are
driven by the company's robust and diversified business profile,
with a leading regional franchise and sound financial profile. In
addition, most of Sura AM's operations are in jurisdictions where
the operating environment (OE) is on a stable trend.
Key Rating Drivers
Grupo Sura
Multijurisdictional SROE on Negative Trend: Grupo Sura's sector
risk operating environment (SROE) score of 'bb+' with high
importance and negative trend reflects the weighted average of the
implied OEs of the jurisdictions where it has operations. Grupo
Sura is an international group domiciled in Colombia with direct
financial operations in 10 countries in Latin America. However, the
significant reliance on dividends streams from Bancolombia
(BB+/Negative), Colombia's largest bank, constrains the SROE.
As of September 2024, the entity's largest operations and asset
exposure were in Colombia, with 80.2% of the group's consolidated
assets, approximately 52% of the invested equity, and around 60% of
its dividends. Fitch also considers in its assessment that the
entity has other earning assets in several additional jurisdictions
with stronger OEs, which partially allows the issuer to retain the
capacity to service its obligation in the relevant currency in the
event of sovereign default.
This high level of exposure underscores the vulnerability of Grupo
Sura's operations to changes in Colombia's economic and political
environment, reflecting the potential for increased risk in the
event of a sovereign downgrade.
Diversified Business Profile: Grupo Sura's IDRs are based upon its
standalone credit profile (SCP) and reflect its diversified
business profile with dominant local franchises and revenue
diversification in strongly regulated financial industries,
including pension funds, banking and insurance services, in several
countries in Latin America. The SCP is below the implied SCP as it
is aligned with, and limited by, the assigned SROE score of 'bb+'
and Colombia's sovereign rating.
Recognized Franchise and Stable Business Model: Grupo SURA's strong
business profile reflects its competitive position within the
region and business model. The banking business is the most
relevant in terms of dividend through its noncontrolling stake in
Bancolombia, while Sura AM is the leading mandatory pension fund
manager (MPFM) in Latin America with USD174 billion in AUM as of
September 2024. The insurance operations of Suramericana provide a
steady source of income for the group. The company has a consistent
strategy and execution, which has produced stable results and
recurring upstream dividends from its subsidiaries and affiliates.
Good Quality of Investments: For investment companies that invest
in a finite number (less than 30) of portfolio companies or exhibit
material portfolio concentration (individuals holding greater than
15%), Fitch considers the underlying investments' credit quality
and seniority to assess overall asset performance and quality.
Accordingly, Grupo Sura's 'bbb-' negative outlook asset performance
factor score corresponds to the weighted average credit quality of
its main subsidiaries, which are the financial segment
subsidiaries.
Bancolombia's Viability Rating (VR; bb+) is in line with its
implied VR and reflects the robust company profile, underpinned by
its leading market share in Colombia and regional presence in
Central America, enabling consistent and ample total operating
income generation and representing the main source of dividends for
Grupo Sura.
Sound Profitability: Grupo Sura's profitability reflects the
relative resilience of earnings as a result of a more diversified
business model across financial business lines. As of December
2024, the net income to average equity was 22.5% (approximately
8.5% without Nutresa), above the last four-year average of 5.0%.
This increase was due to a one-time effect from the gain on the
sale of investments in Grupo Nutresa, as well as solid performance
from Bancolombia and Sura AM.
Decrease in Leverage: Grupo Sura's leverage has decreased and is
commensurate with its rating. Gross debt to tangible equity was
0.6x at September 2024. In early 2025, the group made a tender
offer to buy back its 2026 senior notes, which closed at USD230
million, that will alleviate some liquidity pressure for 2026.
Grupo Sura is assessing alternatives (based on market conditions)
for the remaining bonds due in 2026 including dividends flows from
its subsidiaries, and capital optimization to continue with its
deleveraging path which Fitch considered consistent with its
financial performance.
Sound Operational Expense Coverage: Grupo Sura's unconsolidated
operational expense coverage was 1.2x as of Sept. 30, 2024 (average
between 2020 and 2023: 1.6x). Its unconsolidated interest coverage
(one-year upstream dividend and interest income over interest
expenses) was a sound 3.3x as of the same date (average between
2020 and 2023: 3.3x). Both metrics are commensurate with a 'bb+'
level factor score for investment companies.
Grupo Sura's subsidiaries and investments provide a strong upstream
of dividends relative to the holding company's operating expenses.
Fitch believes that the upstream dividends and interest income from
subsidiaries adequately cover fixed expenses and debt service at
the holding company level.
Sura AM
Standalone Credit Profile Drives IDRs: SURA AM's Long-Term IDRs are
based on its SCP, which is rated one notch above the assigned SROE
score of 'bbb-'. It is also two notches above Colombia's sovereign
rating. The ratings reflect the company's robust business profile,
leading regional franchise, large footprint, and sound financial
profile. In addition, the ratings reflect a credit profile that is
resilient to changes in the OE.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Grupo Sura
- A weaker assessment of Grupo Sura's multijurisdictional SROE, due
to a sovereign downgrade in Colombia;
- An important reduction in the dividends flows from its main
subsidiaries, related to regulatory restrictions on the banking
business or an erosion of the financial profiles that negatively
impacts the debt service, mainly Bancolombia;
- Assumption of new debts in volumes significant relative to the
value of the assets which results in a substantial weakening of
financial leverage, its interest coverage level, and liquidity.
Sura AM
- A downgrade of the SROE score could occur due to significant
adverse regulator changes or sovereign downgrades in Chile, Mexico
or Colombia;
- SURA AM's credit metrics eroding to the point that its
debt-to-adjusted FEBITDA ratio deteriorates and remains
consistently above 3.0x or its adjusted
FEBITDA-to-financial-expense ratio remains well below 6.0x.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Grupo Sura
- Grupo Sura's IDRs could be upgraded by the confluence of an
improvement in the multijurisdictional SROE and the Colombian
sovereign rating as well as the credit quality of its main
subsidiaries;
-Grupo Sura National Ratings have no upside potential because they
are at the highest level on the national scale.
Sura AM
- Over the medium term, the ratings could be upgraded if, together
with a consistently improved financial profile, SURA AM's SROE
score remains in the 'bbb' category, with leverage (gross debt to
FEBITDA) improving and remaining below 1.5x and interest coverage
(FEBITDA to interest expense) rising and remaining above 12.0x.
DEBT AND OTHER INSTRUMENT RATINGS: KEY RATING DRIVERS
Grupo Sura's global senior unsecured long-term debt is rated at the
same level as its Long-Term IDR, as the likelihood of default on
the notes is the same. Likewise, the national scale senior
unsecured long- and short-term debt are rated at the same level as
the issuer's national long-term and short-term ratings.
SURA AM's senior unsecured bond rating corresponds with the
company's Long-Term IDR, given the probability of default is the
same as that of the issuer.
DEBT AND OTHER INSTRUMENT RATINGS: RATING SENSITIVITIES
The ratings on Grupo Sura's senior unsecured debt would move in
line with its global and national scale IDRs, respectively.
Sura AM's senior unsecured debt would generally move in line with
its Long-Term IDR.
ADJUSTMENTS
Grupo Sura
The SCP has been assigned below the implied SCP due to the
following adjustment reason(s): Sector Risk Operating
Environment/Sovereign Rating Constraint (negative).
The Business Profile score has been assigned below the implied
score due to the following adjustment reason(s): Business Model
(negative).
Sura AM
The Sector Risk Operating Environment score has been assigned above
the implied score due to the following adjustment reason(s):
International operations, divergence between domicile and business
activity (positive).
The Earnings & Profitability score has been assigned below the
implied score due to the following adjustment reason(s): Revenue
Diversification (negative).
The Funding, Liquidity & Coverage score has been assigned above the
implied score due to the following adjustment reason(s): Historical
and future metrics (positive).
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Grupo de
Inversiones
Suramericana S.A. LT IDR BB+ Affirmed BB+
LC LT IDR BB+ Affirmed BB+
Natl LT AAA(col)Affirmed AAA(col)
Natl ST F1+(col)Affirmed F1+(col)
senior
unsecured LT BB+ Affirmed RR4 BB+
senior
unsecured Natl LT AAA(col)Affirmed AAA(col)
senior
unsecured Natl ST F1+(col)Affirmed F1+(col)
Sura Asset
Management S.A. LT IDR BBB Affirmed BBB
ST IDR F3 Affirmed F3
LC LT IDR BBB Affirmed BBB
LC ST IDR F3 Affirmed F3
senior
unsecured LT BBB Affirmed BBB
[] Fitch Alters Outlook on Colombian Banks Ratings to Negative
--------------------------------------------------------------
Fitch Ratings has conducted a portfolio review of Colombian and
Central American banks following Colombia's sovereign Rating
Outlook revision to Negative from Stable on March 6, 2025.
Fitch revised the Outlook on Colombia's ratings to Negative from
Stable on the deterioration in its fiscal position and uncertain
prospects for corrective measures. The central government fiscal
deficit for 2024 came in at 6.7% of GDP, sharply underperforming
Fitch's forecast of 5.6% of GDP, mainly due to revenue shortfalls
and an inability to implement offsetting spending cuts.
Fitch's assessment of the Operating Environment (OE) for Colombian
banks remains unchanged, despite the Negative Outlook on the
sovereign rating. This outlook is mostly driven by worsening fiscal
and public debt dynamics, but not necessarily reflecting weaker
economic activity or any other material headwind to the banks'
operating conditions.
The banking system's sufficient capitalization, improving
profitability, and reducing loan impairment charges provide
adequate resilience to withstand stress from government and
external shocks. GDP growth is projected to increase to
approximately 2.7% in 2025, up from 1.7% in 2024.
This portfolio review includes Colombian banks with Issuer Default
Ratings (IDR) rated at the same level or above that of the
sovereign. Fitch believes these ratings are more sensitive to a
potential downgrade on the sovereign rating. Furthermore, the
agency will not rate Colombian FIs higher than the sovereign
rating, based on their current intrinsic credit profiles, except
for those with highly-rated parents. Fitch has affirmed all of the
ratings for the Colombian banks included in this review.
The Viability Ratings (VR) were not reviewed at this time, given
that these ratings do not have explicit outlooks, and also
considering the affirmation of the OE score with a stable outlook.
However, VRs at the 'bb+' level would likely be downgraded in the
scenario of a potential sovereign downgrade, as Fitch rarely rates
a bank's VR higher than the respective sovereign rating.
The banks' national ratings, as well as those of other financial
institutions rated in Colombia, are not directly impacted, as these
ratings reflect the relative strengths and weaknesses of each
institution in a specific jurisdiction.
Rating actions have also been taken on the Colombian FI's Central
American subsidiaries, specifically in Costa Rica, Guatemala and
Panama.
Key Rating Drivers
Government Support-Driven Banks
This group considers state-owned banks with IDRs and Government
Support Ratings (GSRs) driven by implicit support from the
sovereign: Banco de Comercio Exterior de Colombia (Bancoldex),
Financiera de Desarrollo Territorial S.A (Findeter), Financiera de
Desarrollo Nacional S.A. (FDN) and Banco Agrario de Colombia S.A,
(Banagrario).
The Colombian government is the shareholder and the source of any
potential support, if required. The ratings were revised to
negative as the creditworthiness of these entities is linked to the
sovereign, given their policy role, state ownership and high
strategic importance to the government. Therefore, their ratings
have been traditionally equalized to the sovereign's.
Private Sector Banks
Bancolombia S.A. (Bancolombia), Banco de Bogota S.A. (Bogota),
Banco Davivienda S.A. (Davivienda) and Banco de Occidente S.A.
(Occidente)'s IDRs are sensitive to the OE and the Colombia
sovereign ratings. The respective Negative Outlook in their IDRs
mirror the recent Outlook revision on Colombia's ratings, as these
banks are constrained by the sovereign's ratings based on their
current intrinsic credit profiles. The ratings are highly
influenced by the OE and robust company profiles due to their large
franchises and diversified business models.
For additional information on this banks VR and rating drivers
please refer to the latest publish RAC at www.fitchratings.com
Senior And Subordinated Debt
Bogota's senior unsecured obligations are rated at the same level
as their respective IDRs.
Bancolombia, Bogota and Occidente's subordinated debt is rated two
notches below the respective banks' VR.
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 common
equity Tier 1 (CET1) at 5.125% and full discretion to cancel
coupons.
Although the agency does not assign an Outlook to debt issuances, a
negative action on the banks' anchor ratings would translate to the
debt's rating.
GSR
Bancolombia's, Bogota's and Davivienda's GSR of 'bb', reflects the
agency's estimation of a moderate probability of sovereign support,
if required, given the banks' systemic importance. The ability of
the sovereign to provide support is based on its 'BB+'/Negative
rating.
Shareholder Support Ratings (SSR)
Occidente's SSR of 'bb+' reflects Fitch's view of a high
probability of support from GA, if needed, given its role and
contribution to the group. Occidente is GA's second largest bank.
In Fitch's opinion, Occidente is core to GA's strategy and
institutional support should be forthcoming if required. GA has a
consistent track record of support for its subsidiaries, and its
ability to support them is reflective of its 'BB+'/Negative
rating.
Foreign Owned Commercial Banks (BBVA Colombia S.A.)
Fitch has affirmed BBVA Colombia's Foreign Currency and Local
Currency Long-Term IDRs at 'BBB-' and 'BBB', respectively, with the
outlook on both LT IDRs being revised to Negative from Stable. The
Outlook for the Local Currency Long-Term IDR of 'BBB' has been
revised to Negative, as Fitch typically does not assign a
systemically-important bank's LC IDR more than two notches above
the respective sovereign rating.
The Outlook for the 'BBB-' Foreign Currency and Local Currency
Long-Term has been revised to Negative, as this rating is
constrained by Colombia's Country Ceiling (CC) of 'BBB-'. If the
Colombian sovereign is downgraded, the CC could be adjusted
downward accordingly, leading to a potential downgrade of BBVA
Colombia's Long-Term IDRs.
When assessing the potential uplift from the sovereign when there
is Shareholder Support, BBVA Colombia's significant domestic
operations limit the uplift to two notches above the sovereign, as
per Fitch's criteria. Fitch also affirmed the Foreign Currency and
Local Currency Short-Term IDRs at 'F3' and 'F2', respectively, and
the SSR at 'bbb-', but all these ratings have downside potential in
the event of a Long-Term IDR downgrade.
Although the agency does not assign an Outlook to BBVA Colombia's
subordinated debt issuance, which is rated two notches below what
Fitch considers the appropriate anchor rating of 'BBB-', a negative
action on the bank's Foreign Currency IDR would translate to the
debt rating.
Grupo Aval Acciones y Valores S.A., Grupo Aval Ltd, Corporacion
Financiera Colombiana S.A. (Corficolombiana) and Banco de Occidente
Panama
Grupo Aval's outlook mirrors that of its main subsidiary, Bogota,
and remains equalized. Grupo Aval's ratings are driven by the
business and financial profile of its main operating subsidiary.
Low double leverage, good cash flow metrics and a sound competitive
position in multiple markets also support Grupo Aval's ratings.
Grupo Aval Limited's senior unsecured debt ratings were affirmed
and are aligned with those of Grupo Aval, as this entity guarantees
the senior bonds issued by the former.
Corficolombiana's Outlook revision reflects the impact of the
sovereign rating revision. Corficolombiana's IDRs are driven by its
VR, which reflects with high importance the challenging OE and its
company profile. The ratings also consider Corficolombiana's strong
financial profile. Under Fitch's current assessment,
Corficolombiana's IDR will likely remain at the level determined by
its own VR, or at the same level as its main shareholder and its
controlling company, whichever is higher.
The entity'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. In Fitch's opinion, support for Corficolombiana would come
from its main shareholder. Its ability to support Corficolombiana
is reflected in its 'BB+'/Negative rating.
Banco de Occidente Panama's (BOP) outlook mirrors that of its
holding company, Banco de Occidente. BOP's IDRs reflect the
potential support they would receive from Banco de Occidente and
its ultimate parent Grupo Aval, if required, as reflected in its
'bb+' SSR.
Multibank, Inc.
Multibank, Inc.'s IDRs Outlook were revised to mirror the same
rating action on its parent Banco de Bogota's rating as reflected
in the SSR of 'bb+'. Multibank's ratings are equalized with those
of Banco de Bogota's, reflecting Fitch's assessment of the
potential support they would receive from their parent, if
required. Fitch has also revised to Negative from Stable
Multibank's National Long-Term rating and affirmed it at
'AA+(pan)'. National short-term rating of F1+(pan) was also
affirmed.
As these national-scale ratings in Panama are based on the
perceived support from the Colombian parent, a potential downgrade
of the latter could have implications on the local relativity of
creditworthiness of this Panamanian subsidiary, which explains the
Negative Outlook on its National Long-Term ratings in Panama.
Bancolombia (Panama) S.A. (BP), Bancolombia Puerto Rico
International Inc (BPR), Banco Agromercantil de Guatemala S.A.
(BAM) and Banistmo
BP and BPR's IDRs reflect the potential support they would receive
from Bancolombia, if required. In Fitch's view, these entities are
an integral part of its parent's business model and core to its
strategy. BP and BPR's IDR rating action mirror the revision on
Bancolombia's IDRs, as their ratings are fully aligned with those
of its parent.
BAM's IDRs are based on the potential support it would receive from
its shareholder Bancolombia, if required. BAM's Local and Foreign
Currency IDRs were revised to Negative from Stable, following
Bancolombia's downgrade, and reflects the parent's solid commitment
to its subsidiary. The national-scale ratings of this entity in
Guatemala and its outlook remain unchanged, as they would not
necessarily change in the scenario of a potential downgrade of its
Colombian parent company.
Banistmo S.A.'s ratings are based on Fitch's opinion on the ability
and propensity of its parent Bancolombia to provide support if
required, which results in Banistmo's IDRs being aligned with those
of its parent, mirroring any changes in Bancolombia's IDRs and
Outlook. Fitch has also revised to Negative from Stable Banistmo's
National Long-Term rating and affirmed it at 'AA+(pan)'. National
short-term rating of F1+(pan) was also affirmed.
As these national-scale ratings in Panama are based on the
perceived support from the Colombian parent, a potential downgrade
of the latter could have implications on the local relativity of
creditworthiness of this Panamanian subsidiary, which explains the
Negative Outlook on its National Long-Term ratings in Panama.
The SSR of 'bb+' for BP and BPR, BAM and Banistmo 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 that 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+'/Negative' IDR.
Banco Davivienda Costa Rica S.A. (Davivienda CR)
Fitch has also revised Davivienda CR's IDR Outlook to negative
mirroring the same rating outlook of Davivienda. Davivienda CR's
IDRs are underpinned by its 'bb+' SSR, which reflects Fitch's
assessment of the ability and propensity of its shareholder
Davivienda to provide timely support if needed.
The national-scale ratings of this entity in Costa Rica and its
Outlook remain unchanged, as they would not necessarily change in
the scenario of a potential downgrade of its Colombian parent
company.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Government Support-Driven Ratings
- As development banks that are majority owned by the state,
Bancoldex, Findeter, FND and Banco Banagrario's creditworthiness
and ratings are directly linked to those of the sovereign. Hence,
its ratings and Outlook will move in line with any potential change
in Colombia's ratings;
- Although not a baseline scenario, Bancoldex, Findeter, FDN and
Banagrario's ratings could change if Fitch perceives a decrease in
the bank's strategic importance to the government's public
policies, such as a shift in its countercyclical role or supporting
commercial companies either directly or through wholesale loans.
Bancolombia, Bogota, Davivienda and Banco de Occidente
- Bancolombia, Bogota, Davivienda and Banco de Occidente's VRs and
IDRs are sensitive to a material deterioration in the local
operating environment or a negative sovereign rating action;
- Bancolombia ratings could be downgraded due to a significant
deterioration in profitability and capital metrics, specifically if
the operating profit to risk weighted assets (RWA) consistently
falls below 1% and the CET1 ratio drops below 10%, which would no
longer align with its strong business profile.
- Banco de Bogota's ratings could be downgraded from an extended
period of OE deterioration that leads to significant weakening of
asset quality and/or profitability (operating profit to RWA
consistently below 1.5%), in turn resulting in an erosion of
capital cushions if the CET1 falls consistently below 10%.
- Davivienda's ratings could be downgraded if asset-quality
deterioration is not controlled below 4% and profitability ratio
(operating profit to RWA) consistently deviate below from 1.25%
over the next 12 months-24 months, resulting in an erosion of CET1
consistently below 10%.
- 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%.
- Bancolombia's, Bogota's and Davivienda's GSR are potentially
sensitive to any change in assumptions as to the propensity or
ability of Colombia to provide timely support to the banks.
- Occidente's SSRs would be affected if Fitch changes its
assessment of Grupo Aval's willingness and/or ability to provide
support.
- Bancolombia's, Davivienda's, Occidente's and Bogota's debt
ratings would move in tandem with the banks' IDRs and VR.
BBVA Colombia
- Negative rating action on BBVA S.A.'s IDRs would lead to similar
actions in BBVA Colombia's IDRs and potentially its SSR if the
parent is downgraded by two notches or more;
- Negative rating action on the Colombian sovereign's ratings would
also lead to a similar action on the Long-Term Foreign Currency IDR
and its SSR as they are capped by the Country Ceiling;
- BBVA Colombia's IDRs and SSR could also change if Fitch's
assessment of its parent's ability and/or willingness to support
the bank changes.
Grupo Aval's, Aval Limited, Corficolombiana and BOP
- Grupo Aval's IDR would remain at the same level as 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 line with Grupo Aval's IDRs;
- 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;
- BOP's IDRs are support-driven and aligned with those of its
parent's. Therefore, these ratings would mirror any changes in
Banco de Occidente's IDRs.
Multibank, Inc.
- Any negative action on Banco de Bogota's IDRs would also lead to
a similar action on Multibank's SSR, IDRs and national ratings; in
addition, its IDR could also change if Fitch's assessment of its
parent's willingness to support its subsidiary changes;
- Multibank's senior unsecured debt would mirror any potential
downgrade on its IDRs.
BP and BPR
The IDRs of these entities are support-driven and aligned with
those of its parent's. Therefore, these ratings would mirror any
changes in Bancolombia's IDRs.
BAM
- A downgrade on Bancolombia's IDRs would lead to a similar action
on BAM's IDRs;
- BAM's SSR and IDRs are sensitive to a downgrade of the Guatemalan
sovereign rating and Country Ceiling.
Banistmo
- Any negative action on Bancolombia's IDRs would lead to a similar
action on Banistmo's SSR. In addition, IDRs and SSR and national
ratings could be downgraded if Fitch's assessment of its parent's
propensity and ability to provide support to the bank diminishes;
- A further deterioration in asset quality that denotes a weakening
in the bank's risk profile could put pressure on Banistmo's VR.
Also, its VR could be downgraded as a result of a sustained
deterioration of profitability and asset quality ratios that
undermine the bank's financial performance, driving a decline in
its CET1 ratio consistently below 10% and/or its operating
profitability/RWA metric consistently below 0.5%;
- Banistmo's senior unsecured debt would mirror any potential
downgrade on the bank's International and national ratings.
Davivienda CR
- Negative changes in Davivienda CR's IDRs and SSR would mirror a
more than one-notch negative movement in Costa Rica's sovereign
ratings and Country Ceiling;
- A downgrade in Davivienda's IDRs would trigger the same action on
Davivienda CR's IDRs and SSR;
- Any perception by Fitch of the parent's significantly reduced
propensity to support the subsidiary may trigger a downgrade of the
IDRs and SSR.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Government Support-Driven Ratings
- An upgrade is highly unlikely in the near future as the IDRs are
constrained by the sovereign rating;
- Positive Rating actions on Bancoldex, Findeter, FDN and Agrario
will mirror any potential positive change in Colombia's sovereign
rating.
Bancolombia, Bogota, Davivienda and Banco de Occidente
- Given the limitations of the operating environment, a ratings
upgrade is unlikely in the medium term for Bancolombia, Bogota,
Davivienda and Occidente;
- Bancolombia's, Bogota's and Davivienda's GSR are potentially
sensitive to any change in assumptions as to the propensity or
ability of Colombia to provide timely support to the banks;
- Occidente's SSRs would be affected if Fitch changes its
assessment of Grupo Aval's willingness and/or ability to provide
support;
- Bancolombia's, Davivienda's, Occidente's and Bogota's debt
ratings would move in tandem with the bank's IDRs and VR.
BBVA Colombia
- BBVA Colombia's IDR will likely remain at the level determined by
its own VR, or one notch below the parent's IDR subject to
sovereign rating and Country Ceiling considerations, whichever is
higher.
Grupo Aval's, Aval Limited, Corficolombiana and BOP
- Grupo Aval's IDR would remain at the same level as 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 line with Grupo Aval's IDRs;
- 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;
- BOP's IDRs are support-driven and aligned with those of its
parent's. Therefore, these ratings would mirror any changes in
Banco de Occidente's IDRs.
Multibank, Inc.
- Positive rating actions on Multibank's SSR, IDR and national
ratings could be driven by positive rating actions on Banco de
Bogota's IDR;
- Positive rating actions on Multibank's IDR could be driven by
positive rating action on its VR;
- Multibank's senior unsecured debt would mirror any potential
upgrade on the bank's ratings.
BP and BPR
The IDRs of these entities are support-driven and aligned with
those of its parent's. Therefore, these ratings would mirror any
changes in Bancolombia's IDRs.
BAM
- BAM's Foreign Currency IDR have limited upside potential given
the current Guatemalan sovereign rating and Country Ceiling;
- An upgrade on Bancolombia's IDRs would lead to a similar action
on BAM's Local Currency IDR.
Banistmo
- A positive rating action on Bancolombia's IDRs would trigger
similar rating action on Banitsmo's IDRs, SSR and national
ratings;
- Banistmo's senior unsecured debt would mirror any potential
upgrade on the bank's ratings.
Davivienda CR
- Davivienda CR's IDRs and SSR could be upgraded one notch
following a similar action on Davivienda's IDRs.
Summary of Financial Adjustments
Prepaid expenses and other deferred assets were reclassified as
other intangible assets and were deducted from FCC since the agency
considers these to have low capacity to absorb losses.
Public Ratings with Credit Linkage to other ratings
Bancoldex, Agrario, FDN and Findeter's ratings are support driven
by Colombian government.
BBVA Colombia's ratings are support driven by its ultimate parent
Banco Bilbao Vizcaya Argentaria S.A.
The ratings of Grupo Aval Acciones y Valores are support-driven
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.
Banco de Occidente Panama are support driven by its ultimate parent
Banco de Occidente.
Multibank's ratings derive from the support of Banco de Bogota
(BB+/Stable).
Bancolombia Panama, Bancolombia Puerto Rico, Banistmo and BAM's
ratings are driven by Bancolombia's ratings.
Davivienda CR's ratings are support driven by its ultimate parent
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
----------- ------ -----
Banco de Comercio
Exterior de
Colombia S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Government Support bb+ Affirmed bb+
Banco Davivienda
(Costa Rica) S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
Financiera de
Desarrollo
Territorial S.A.
– Findeter LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Government Support bb+ Affirmed bb+
Multibank, lnc. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Natl LT AA+(pan) Affirmed AA+(pan)
Natl ST F1+(pan) Affirmed F1+(pan)
Shareholder Support bb+ Affirmed bb+
Banco de
Occidente
(Panama), S. A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
Grupo Aval
Acciones
y Valores S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
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
Government Support bb Affirmed bb
Financiera de
Desarrollo
Nacional S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Government Support bb+ Affirmed bb+
Banco Agrario de
Colombia S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Government Support bb+ Affirmed bb+
Bancolombia
Puerto Rico
Internacional Inc. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
Grupo Aval
Limited
senior
unsecured LT BB+ Affirmed BB+
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
Shareholder Support bb+ Affirmed bb+
Bancolombia
(Panama) S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
Banco Agromercantil
de Guatemala S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Shareholder Support bb+ Affirmed bb+
BBVA Colombia
S.A. LT IDR BBB- Affirmed BBB-
ST IDR F3 Affirmed F3
LC LT IDR BBB Affirmed BBB
LC ST IDR F2 Affirmed F2
Shareholder Support bbb-Affirmed bbb-
Banco de
Bogota, S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Government Support bb Affirmed bb
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
Shareholder Support bb+ Affirmed bb+
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
Government Support bb Affirmed bb
Banistmo S.A. LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Natl LT AA+(pan) Affirmed AA+(pan)
Natl ST F1+(pan) Affirmed F1+(pan)
Shareholder Support bb+ Affirmed bb+
=============
J A M A I C A
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JAMAICA: BOJ Acknowledges Multilaterals for Supporting Econ. Gains
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RJR News reports that Bank of Jamaica Governor Richard Byles is
applauding multilateral institutions for their role in helping to
drive Jamaica's economic achievements over the last 15 years.
He highlighted agencies such as the International Monetary Fund,
World Bank, Center for Latin American Monetary Studies and European
Union, according to RJR News.
In addition, he acknowledged the assistance of the Economic
Commission for Latin America and the Caribbean as well as the
French Development Agency, the report notes.
About Jamaica
Jamaica is an island country situated in the Caribbean Sea. Jamaica
is an upper-middle income country with an economy heavily dependent
on tourism. Other major sectors of the Jamaican economy include
agriculture, mining, manufacturing, petroleum refining, financial
and insurance services.
On Feb. 21, 2025, Fitch Ratings affirmed Jamaica's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'BB-', with a
positive rating outlook. In October 2023, Moody's upgraded the
Government of Jamaica's long-term issuer and senior unsecured
ratings to B1 from B2, and senior unsecured shelf rating to (P)B1
from (P)B2. The outlook has been changed to positive from stable.
In September 2024, S&P affirmed 'BB-/B' longterm foreign and local
currency sovereign credit ratings on Jamaica and revised outlook to
positive.
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P U E R T O R I C O
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ORION SECURITY: Case Summary & 20 Largest Unsecured Creditors
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Debtor: Orion Security Service and Investigation Incorporated
State Road 818 KM 2.0
Bo. Cibuco
Corozal, PR 00783
Business Description: Orion Security Service and Investigation
is a security services company based in
Corozal, Puerto Rico.
Chapter 11 Petition Date: March 7, 2025
Court: United States Bankruptcy Court
District of Puerto Rico
Case No.: 25-01003
Debtor's Counsel: Rafael A. Gonzalez Valiente, Esq.
GODREAU & GONZALEZ, LLC
P.O. Box 9024176
San Juan, PR 00902-4176
Tel: 787-726-0077
E-mail: rgv@g-glawpr.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Andres Morales Negron as president.
A full-text copy of the petition, which includes a list of the
Debtor's 20 largest unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/6HZQMRQ/Orion_Security_Servic_Orion_Security__prbke-25-01003__0001.0.pdf?mcid=tGE4TAMA
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S T . L U C I A
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ST. LUCIA: GDP Growth is Expected at 3.7%, IMF Says
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The Executive Board of the International Monetary Fund (IMF)
concluded the 2024 Article IV consultation with St. Lucia and
considered and endorsed the staff appraisal.
St. Lucia's tourism-dependent economy has normalized after the
pandemic. GDP growth is expected at 3.7 percent in 2024, on strong
tourism, construction, and manufacturing activity. Unemployment has
dropped to decade lows but remains elevated at 14 percent. The
authorities recently introduced a minimum wage, increased minimum
pensions, and plan to implement an unemployment insurance scheme.
Inflation, which peaked at 6.4 percent y/y in 2022, fell to 0.8
percent in June, driven by utilities and energy prices, as well as
a VAT reduction. The current account deficit narrowed to 1.9
percent of GDP in 2023 with the rebound in tourism, even as the
fiscal deficit widened to 2.6 percent of GDP and debt ticked up to
74.5 percent of GDP. Banks are liquid and profitable, but credit
growth is weak, although credit unions are growing rapidly.
Over the medium term, once planned infrastructure and hotel
investments approach completion, growth is projected to slow to a
modest 1.5 percent over the medium term. Inflation is expected to
rise to 2 percent over the medium term as global input costs
normalize. The deficit excluding natural disasters costs is
forecast to narrow to 1.3 percent of GDP in FY2024 but widen
thereafter to 2.2 – 2.9 percent of GDP on the back of higher
capital expenditures. Debt is projected to stabilize around 74
percent of GDP, well above the regional debt ceiling of 60 percent
of GDP. The current account deficit is anticipated to narrow
further over the medium term on account of stronger tourism and
lower fuel prices. Bank credit to the private sector is projected
to remain anemic because of high NPLs, the lack of foreclosure
legislation, and concerns about the fiscal outlook.
Risks to the outlook are tilted to the downside and include
investment delays and large debt rollover needs. St. Lucia is
vulnerable to a global slowdown and supply disruptions, as well as
natural disasters and climate change. On the upside,
stronger-than-expected growth in tourism and construction could
provide a positive boost to the economy.
Executive Board Assessment
Executive Directors agreed with the thrust of the staff appraisal.
They welcomed St. Lucia's strong economic performance, aided by
robust tourist arrivals and a supportive fiscal stance. While
noting the favorable near‑term prospects, Directors highlighted
that medium‑term growth is expected to slow and risks are tilted
to the downside, including from investment delays and high tourism
dependence. Prudent policies and reforms should aim to reduce debt,
increase productivity, and boost potential growth.
Directors recommended sustained fiscal consolidation, while
safeguarding space to support capital projects and resilience
against natural disasters. They called for comprehensive tax policy
reform, enhanced tax administration, and improved control and
targeting of current expenditures, including the wage bill.
Directors welcomed the authorities' commitment to achieving the
regional debt target and recommended the adoption of a sound fiscal
rule. Further improving the transparency of the
Citizenship‑by‑Investment Program is also important.
Directors highlighted that while systemic risks appear contained,
further reforms are needed to strengthen the financial sector. They
recommended steps to further reduce banks' NPLs and enact
foreclosure legislation to support credit growth. Improved
compliance with ECCB provisioning requirements for banks is
necessary. Directors welcomed the new Co‑operative Societies Act
and encouraged continued efforts to strengthen credit union
regulation. They also highlighted the need to enhance risk
monitoring of the insurance sector and for continued progress to
address AML/CFT regulatory gaps.
Directors underscored that structural reforms and natural
disaster‑resilient investment are crucial to diversify the
economy and boost potential growth. They emphasized the importance
of improving credit access, reducing operating and tax compliance
costs, and addressing labor force skill mismatches. Noting the
implications for external competitiveness, Directors urged careful
calibration of the minimum wage, in close consultation with
stakeholders. They also encouraged measures to enhance the
natural‑disaster insurance framework and develop geothermal
energy.
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S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Latin America is a daily newsletter
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Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.
Copyright 2025. All rights reserved. ISSN 1529-2746.
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