...- We think AFE S.A. faces mounting risks while it seeks to refinance its senior secured notes and revolving credit facility (RCF) amid tough financial conditions. - Furthermore, lack of long-term funding constrains AFE management's ability to invest in new portfolios, putting pressure on AFE's business position. - We also anticipate collections will remain volatile in 2023 given uncertain economic conditions and the company's high exposure to secured nonperforming loans and real estate. - We therefore lowered our ratings on AFE and its outstanding senior secured notes to 'B-' from 'B' and placed the ratings on CreditWatch with negative implications. - The CreditWatch negative indicates a 50% likelihood of a downgrade if AFE fails to refinance its senior secured notes or RCF in the next three months, which would put more pressure on its liquidity position and increase the risk of distressed restructuring....
