Mega Announces Change in Credit Rating By S&P Global Ratings

Guadalajara, Jalisco, Mexico, October 17, 2022. – Operadora de Servicios Mega, S.A. de C.V., SOFOM E.R. (“Mega” or the “Company”), a leading leasing and lending company in Mexico and the United States, announces that S&P Global Ratings downgraded the Company’s global scale credit rating to ‘B’ from ‘B+’ and its national scale rating to ‘mxBB+/mxB’ from ‘mxBBB/mxA-2’. S&P Global Ratings stated that the change reflects current adverse economic conditions, the sector’s financing risks, and the impact on the Company’s profitability.

MEGA reiterates that it maintains access to its traditional funding sources, as evidenced by the $37 million dollars in loans granted in the past few months by Banco Bancrea S.A., Banco Invex S.A., and GAWA Capital Partners, SGEIC, S.A. Additionally, as part of its strategy to manage current market conditions, the Company has decided to prioritize a solid balance sheet by focusing on cash flow and asset quality over profitability.

In anticipation of slower economic activity and difficult funding conditions, MEGA has reduced the refinancing risk of its Senior Notes maturing in 2025 through repurchases, consequently improving its maturity profile cost and debt mix. The Company’s prudent loan portfolio management combined with an efficient business model has led to lower non-performing loan levels than its peers. Considering MEGA’s solid 17.9% capitalization ratio, the Company plans to continue with its growth plans, providing specialized financial solutions to SMEs while prioritizing asset quality.