Fitch downgrades Famsa

Fitch Ratings said it downgraded Grupo Famsa, SAB de CV’s long-term local- and foreign-currency issuer default ratings to D from RD. Concurrently, Fitch downgraded Famsa’s national long-term rating to D(mex) from RD(mex).

Also, Fitch affirmed the company’s senior notes due 2024 at C and revised the recovery rating to RR5 from RR4.

“The downgrade follows Famsa’s failure to pay a short-term certificados bursatiles maturity due July 2, 2020. Fitch also believes Banco Ahorro Famsa’s (BAF) license cancellation is a major operational concern for Famsa given the importance it had for the retail business. Despite Famsa’s intentions to serve its financial obligations, the ceasing of its banking operations has affected the company’s liquidity. Fitch will be closely following the company’s developments regarding operations and financial sustainability,” the agency said in a press release.

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