Category: Ratings Rationale

Kyla Balwant

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.

Government of British Virgin Islands

RATING ACTION:

On March 12, 2024, CariCRIS reaffirmed the issuer ratings of CariAA- (Foreign and Local Currency Ratings) on its regional rating scale assigned to The Government of the Virgin Islands (GoVI). A stable outlook was assigned.

RATING SENSITIVITY FACTORS:

Factors that could lead to an improvement in the ratings and/or Outlook include:

Real GDP growth of at least 5% sustained over the next 2 years.
An uninterrupted improvement in visitor arrivals to greater than pre-hurricane levels maintained over the next 2 years.
A consistent improvement in company incorporations and registrations to pre-pandemic levels maintained over the next 2 years.

Factors that could lead to a lowering in the ratings and/or Outlook include:

An increase in the total public sector debt to above 40% of GDP.
Failure to implement recommendations of the COI by May 2024 or failure to achieve an extended deadline.
A change in the island’s status as a British overseas territory or a material change in the level of support rendered to The VI from the UK.

Analysts’ Contact Info:

Stefan Fortuné

Phone: 1-868-799-6751 (m)

sfortune@caricris.com

Brandon Singh

bsinght@caricris.com

Sagicor Life Jamaica Limited

RATING ACTION:

On March 12, 2024, CariCRIS reaffirmed the Issuer/Corporate Credit rating assigned to Sagicor Life Jamaica Limited (SLJ or the Company) at jmAAA (Local Currency Rating) on its Jamaica national rating scale. A stable outlook was maintained.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the rating and/or outlook include:

Factors that could, individually or collectively, lead to a lowering of the rating and/or outlook include:

A greater than 10% fall in amortised contractual service margin (CSM) and risk adjustment (RA), sustained for 2 consecutive financial periods
A greater than 25% increase in net loss on onerous contracts
A fall in Tangible Net Worth (TNW)/Total Assets to below 20%
A fall in Total Investment Assets/Policy Liabilities to less than 0.5 times

Analysts’ Contact Info:

Keith Hamlet

Mobile: 1-868-487-8356

Megan Dass

Mobile: 1-868-713-6863

mdass@caricris.com

Sagicor Group Jamaica Limited

RATING ACTION:

On March 12, 2024, CariCRIS upgraded the assigned credit ratings by 1-notch to CariA+ (Local Currency Rating) and CariA (Foreign Currency Rating) on the regional rating scale and reaffirmed the Jamaica national scale rating of jmAAA to Sagicor Group Jamaica Limited (SGJ or the Company). A stable outlook was assigned.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the ratings and/or Outlook include:

An increase in CariCRIS’ internal ratings assigned to the sovereign, driven by continued favourable improvements in the macroeconomic environment of Jamaica resulting in a lowering of the debt/GDP ratio of the sovereign.

Factors that could, individually or collectively, lead to a lowering in the ratings and/or Outlook include:

A greater than 15% increase in insurance service expenses leading to lower financial performance of SLJ.
A 21% rise in operating expenses.

Analysts’ Contact Info:

Keith Hamlet

Mobile : 1-868-487-8356

Kyla Balwant

Home Mortgage Bank’s Collateralized Mortgage Obligation CMO-2019-01

RATING ACTION:

On December 6, 2023, CariCRIS reaffirmed the overall issue rating of ttA+ (SO) on the Trinidad and Tobago (T&T) national scale to the TT $200 million Collateralised Mortgage Obligation (CMO) of Home Mortgage Bank (HMB) (CMO 2019-01). A stable outlook was assigned.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement of the rating and/or outlook:

An improvement in the loan portfolio quality, with an NPL ratio of lower than 5% and/or a return to delinquency levels of 2% – 4% within the underlying mortgage pool over the next 12-15 months

Factors that could, individually or collectively, lead to a lowering of the rating and/or outlook:

Persistent and further deterioration in the mortgage pool quality with delinquency levels of above 20% and/ or NPL ratio of above 8% within the underlying mortgage pool leading to heightened extension and/ or default risk over the next 12-15 months
Consistent cash flow shortfalls in the underlying mortgage pool over the next 12-15 months that may impair payments of principals and interests
A deterioration in the credit risk profile of T&T leading to increased market risk

Analysts’ Contact Info:

Anelia Oudit

Mobile : 1-868-487-8364

aoudit@caricris.com

Kyla Balwant

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.

Jamaica Public Service Company Limited

RATING ACTION:

On December 6, 2023, CariCRIS upgraded the assigned corporate credit rating by 1-notch to CariA (Foreign Currency Rating) and CariA+ (Local Currency Rating) on the regional rating scale and reaffirmed the Jamaica national scale rating of jmAA+ to Jamaica Public Service Company Limited (JPS or the Company). A stable outlook was assigned.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the ratings and/or Outlook include:

An improvement in the credit rating of the Government of Jamaica over the next 12 – 15 months
Continued improvement in the economic conditions in Jamaica over the next 2 years, thereby leading to increased demand for energy
Improved operating efficiency, with availability, heat rate and SAIDI metrics consistently meeting targets over the next 2 years

Factors that could, individually or collectively, lead to a lowering in the ratings and/or Outlook include:

A deterioration in the credit rating of the Government of Jamaica over the next 12 – 15 months
Failure to satisfy any existing debt covenants
At least 2 consecutive years of declining operating profit by 10% or more

Analysts’ Contact Info:

Anelia Oudit

Mobile : 1-868-487-8364

aoudit@caricris.com

Kyla Balwant

Wigton Windfarm Limited

RATING ACTION:

On December 6, 2023, CariCRIS upgraded the assigned issue credit rating by 1-notch to CariBBB+ (Local Currency Rating) on the regional rating scale and reaffirmed the Jamaica national scale rating of jmA (Local Currency Rating) to the J $5.8 billion bond issue of Wigton Windfarm Limited (Wigton or the Company). A stable outlook was assigned.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the ratings and /or outlook include:

Successful diversification by the Company into other renewable sources of energy, geographical markets or unrelated streams of income, thereby boosting revenue stability and/or expansion.
Improved operating efficiency, with capacity and availability metrics consistently meeting targets.
Material expansion in total installed capacity resulting in a more than 10% increase in operating profit sustained for 2 years.

Factors that could, individually or collectively, lead to a lowering of the ratings/or outlook include:

Breach of any of the debt covenants.
Failure to satisfy any of the performance requirements of the Power Purchase Agreements

Analysts’ Contact Info:

Anelia Oudit

Mobile : 1-868-487-8364

aoudit@caricris.com

Kyla Balwant

Saint Lucia Electricity Services Limited

RATING ACTION:

On December 6, 2022, CariCRIS reaffirmed the Issuer/Corporate Credit ratings assigned to Saint Lucia Electricity Services Limited (LUCELEC or the Company) at CariBBB- (Foreign and Local Currency Ratings) on its regional rating scale. A stable outlook was maintained.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the Ratings and/or Outlook include:

An improvement in the credit rating of the sovereign over the next 12-15 months
Continued improvements in economic and business conditions over the next 12 months in Saint Lucia, thereby leading to increased electricity sales

Factors that could, individually or collectively, lead to a lowering of the Ratings and/or Outlook include:

A deterioration in the credit rating of the sovereign over the next 12-15 months
A greater than 10% decline in operating revenue sustained for 2 consecutive years
Trade receivables turnover greater than 65 days sustained for 2 years
Debt Service Coverage Ratio lower than 2 times sustained for 2 years
A change in the monopoly position afforded by regulation

Analysts’ Contact Info:

Keith Hamlet

Mobile: 1-868-487-8356

Megan Dass

Mobile: 1-868-713-6863

mdass@caricris.com

The Bank of Belize Limited

RATING ACTION:

On December 6, 2023, CariCRIS upgraded the assigned Issuer/ Corporate credit ratings by 2 notches to CariBBB- (Local and Foreign Currency) on the regional scale and reaffirmed the Belize national scale rating of bzAA+ (Local Currency) to The Belize Bank Limited. Outlook revised to stable.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the ratings and /or outlook include:

Improvement in the ratings of the Government of Belize
Increase in profitability to the order of 10% per annum over the next 2 years
Improvement in asset quality with a NPL ratio of 2.5% over the next 2 years

Factors that could, individually or collectively, lead to a lowering of the ratings/or outlook include:

Lowering of the ratings of the Government of Belize
The occurrence of any factors that may contribute to the deterioration of the CAR below the 9% minimum requirement for the Bank
Decrease in profitability to the order of 15% per annum over the next 2 years
Deterioration in asset quality with a NPL ratio to 7.4% or more over the next 2 years
Cost to income ratio weakens to 75% or more

Analysts’ Contact Info:

Keith Hamlet

Mobile: 1-868-487-4356

Sharlene Gordon

Mobile: 1-1876-618-9811

sgordon@caricris.com

JMMB Group Ltd

RATING ACTION:

On November 7, 2023, CariCRIS reaffirmed the assigned Issuer/Corporate Credit Ratings of CariA– (Regional Local Currency) and CariBBB+ (Regional Foreign Currency) and jmAA- (Local Currency) and jmA+ (Foreign Currency) on the Jamaica national scale for JMMB Group Limited. A stable outlook was assigned.

RATING SENSITIVITY FACTORS:

Factors that could, individually or collectively, lead to an improvement in the ratings and /or outlook include:

Improvement in the Government of Jamaica’s (GOJ) credit rating, reflecting a more favourable business environment for the Group
Growth in PAT of 15% or more for 3 consecutive years without any adverse impacts on regulatory capital ratios
Growth in TNW by greater than 15% for 3 consecutive years
Regional expansion initiatives that lead to an improvement in the Group’s market position in its key business segments

Factors that could, individually or collectively, lead to a lowering of the ratings/or outlook include:

Deterioration of the NPLs to Gross loans ratio to 8% or more
Deterioration of the CAR of any of the Group’s subsidiaries to below the country specific regulatory requirements
Cost to Income ratio weakens to 75% and over
Further deterioration in PAT by 15% or more for another consecutive year

Analysts’ Contact Info

Keith Hamlet

Mobile : 1-868-487-4356

Sultan Mohammed

Mobile: 1-868-362-7304

smohammed@caricris.com