/raid1/www/Hosts/bankrupt/TCRLA_Public/020215.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
Friday, February 15, 2002, Vol. 3, Issue 33
Headlines
A R G E N T I N A
ACINDAR: Braced For Floating Exchange Rate Repercussions
SIDERAR: Creditors Approve Debt-Refinancing
B E R M U D A
GLOBAL CROSSING: Stull, Stull & Brody Commence Class Action Suit
GLOBAL CROSSING: Citizens Communications Writes Down Receivables
GLOBAL CROSSING: Pomerantz Haudek Charges Securities Fraud
GLOBAL CROSSING: Kaplan Fox Seeks To Represent Investors In Suit
GLOBAL CROSSING: Former VP Reveals Dealings With EPIK
D O M I N I C A N R E P U B L I C
YORK RESEARCH: Yet To Start Construction Of Wind Project In DR
E C U A D O R
BANCO DEL PACIFICO: Privatization Delayed Until 2003
J A M A I C A
KAISER ALUMINUM: Jamaica Assures Security Of Local Operations
KAISER ALUMINUM: S&P Lowers Remaining Issue To 'D'
P A N A M A
BLADEX: Moody's Cuts Ratings On Possible Argentine Loan Defaults
BLADEX: Company Profile
U R U G U A Y
GALICIA URUGUAY: Ops Suspended For 90 Days On Liquidity Problems
- - - - - - - - - -
=================
A R G E N T I N A
=================
ACINDAR: Braced For Floating Exchange Rate Repercussions
--------------------------------------------------------
Argentine integrated steelmaker Acindar is monitoring reactions
to this week's floating of the peso against the dollar, Acindar
spokesperson Gustavo Pittaluga disclosed in a report released by
Business News Americas.
"Our final costs will depend on what happens with the dollar, so
we have to see how the floating exchange rate affects the
economy; if it jumpstarts activity or if it remains stalled," he
said.
As a major importer of large amounts of raw materials, Acindar
could be greatly impacted by the monetary changes.
The Company has already informed the Buenos Aires Stock Exchange
that it is set to default Friday on interest payments on 11.25
percent convertible notes due 2004 because of its tight financial
situation stemming from Argentina's economic condition. The
moratorium, according to Pittaluga, is temporary and is intended
to keep Acindar operating normally.
Argentina's main concern is how to avoid falling into an
inflationary spiral, since all devaluations imply an increase in
prices.
"Regretfully we have a very strong inflationary tradition and if
this [crisis] translates into major price increases, we may run
into some problems," Pittaluga said. "But if it is possible to
cap those price hikes, at least keeping things from running amok,
and we have reasonably stable inflation, this could help the
Company."
Acindar has hired Credit Suisse First Boston investment bank to
help it restructure its debts, estimated at US$400 million. The
Company is jointly controlled by Argentina's Acevedo family and
Brazil's Belgo Mineira. It had been posting annual sales of some
US$500 million, but revenues dropped 55 percent in January.
CONTACTS: Jose I. Giraudo, Investor Relations Manager.
Acindar S.A.
Tel. (54 11) 4719 8674
Andrea Dala
Investor Relations Officer
Acindar S.A.
(54 11) 4719 8672
CREDIT SUISSE FIRST BOSTON
Esmeralda 130
Piso 22
1035 Buenos Aires
Argentina
Tel: 011 54 11 4131 2700
Fax: 011 54 11 4131 2730
Credit Suisse First Boston
AVDA. Bouchard #547
Piso 11
Buenos Aires 1106
Argentina
Tel: 011 54 11 4312 3505
SIDERAR: Creditors Approve Debt-Refinancing
-------------------------------------------
Argentine integrated steelmaker Siderar announced to the Buenos
Aires Stock Exchange that creditors have agreed unanimously to a
refinancing of the Company's US$110 million euro medium-term note
(series 2), reports Business News Americas.
Negotiations between the parties for a payment extension on
US$96.25 million due during this year and next are expected to
begin immediately. This latest development comes after the
Company only partially paid principal and interest on the first
quota.
Siderar, which describes itself as Argentina's largest steel
company, had already scaled down its 2002 investment plans to a
mere US$30 million because of the country's financial crisis. The
money will be spent on reducing costs and improving quality.
CONTACTS: SIDERAR
Guillermo Etchepareborda, Investor Relation Manager
Avenida Leandro N. Alem 1067 (C1001AAF)
Buenos Aires, Argentina
Tel. (54-011) 4318-2514
Fax: (54-011) 4313-6417
Home Page: http://www.siderar.com.ar
=============
B E R M U D A
=============
GLOBAL CROSSING: Stull, Stull & Brody Commence Class Action Suit
----------------------------------------------------------------
A class action lawsuit was filed on February 13, 2002, in the
United States District Court for the Southern District of New
York on behalf of all acquirors of Global Crossing Ltd. ("Global
Crossing") (NYSE:GX)(OTC BB:GBLXQ) common stock pursuant to the
merger which closed on September 28, 1999 between Global
Crossing, Frontier Corporation, and a wholly-owned subsidiary of
Global Crossing, and all purchasers of the common stock of Global
Crossing between March 17, 1999 and January 28, 2002, inclusive,
and were damaged thereby.
The complaint asserts claims against certain of Global Crossing's
officers and directors and Arthur Anderson LLP for violations of
Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of
1934, and Rules 10b-5 and 14a-9 promulgated thereunder by the
Securities and Exchange Commission, by failing to disclose
material adverse information and misrepresenting the truth about
the Company, thereby causing plaintiff and other members of the
Class to purchase or acquire Global Crossing common stock at
artificially inflated prices.
Questions concerning the announcement may be directed to Aaron
Brody, Esq. at Stull, Stull & Brody by calling toll-free 1-800-
337-4983, or by e-mail at SSBNY@aol.com, or by fax at 212/490-
2022, or by writing to Stull, Stull & Brody, 6 East 45th Street,
New York, NY 10017.
CONTACT: Stull, Stull & Brody, New York
Aaron Brody, Esq., 1-800-337-4983
e-mail: SSBNY@aol.com
fax : 212/490-2022
TICKERS: NYSE:GX OTCBB:GBLXQ
GLOBAL CROSSING: Citizens Communications Writes Down Receivables
----------------------------------------------------------------
Citizens Communications Company (NYSE: CZN, CZB) announced it is
monitoring the bankruptcy proceedings of Global Crossing Ltd. and
certain Global Crossing affiliates to determine the bankruptcy
filings' effect on Citizens' operations and financial position.
Citizens purchased its Frontier telephone business from Global
Crossing in June 2001 for $3.37 billion, subject to final
purchase price adjustment. Citizens is integrating the Frontier
telephone business with its other telecommunications operations
and has ongoing commercial relationships with Global Crossing
affiliates.
Citizens will reserve approximately $30 million to reflect its
best estimate of the net realizable value of receivables incurred
from these commercial relationships during 2001 and 2002.
Citizens will record a write down of such receivables in the
amount of $21.2 million for the fourth quarter of 2001, with the
remainder recorded in the first quarter of 2002 for receivables
generated after December 31, 2001 and prior to the Global
Crossing bankruptcy filing on January 28, 2002.
About Citizens Communications
Citizens Communications currently is the seventh largest local
exchange company in the United States, serving 2.5 million
telephone access lines in 24 states. Citizens owns approximately
85 percent of Electric Lightwave, Inc. (NASDAQ: ELIX), a
facilities-based, integrated communications provider that offers
a broad range of services to telecommunications-intensive
businesses in the West. More information about Citizens may be
found at www.czn.net.
For more info about Global's bankruptcy filing:
http://bankrupt.com/misc/Global_Crossing1.txt
CONTACT: GLOBAL CROSSING
PRESS:
Dan Coulter
+1-973-410-5810
daniel.coulter@globalcrossing.com
Becky Yeamans
+1-973-410-5857
rebecca.yeamans@globalcrossing.com
ANALYSTS/INVESTORS:
Ken Simril
+1-310-385-5200
investors@globalcrossing.com
Citizens Communications Company
Donald B. Armour, 203/614-5124
darmour@czn.com
GLOBAL CROSSING: Pomerantz Haudek Charges Securities Fraud
----------------------------------------------------------
Pomerantz Haudek Block Grossman & Gross LLP has filed a class
action on behalf of purchasers of the securities of Global
Crossing, Ltd. ("Global Crossing" or the "Company") (NYSE:GX)
during the period between January 2, 2001 and January 30, 2002,
inclusive (the "Class Period"). The case was filed in the United
States District Court for the District of New Jersey. Named as
defendants are certain senior executive officers and directors of
the Company. The Company filed for bankruptcy on January 28, 2002
and its stock has been delisted from the NYSE.
The Complaint alleges that defendants violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934 by reporting
inflated revenues and earnings for the Company during the Class
Period. As a result, it is alleged, Global Crossing's stock was
artificially inflated throughout the Class Period causing injury
to plaintiff and the other Class members. Defendants, meanwhile,
allegedly profited by nearly $150 million in insider stock sales.
As charged in the Complaint, among other things, Global Crossing
would "trade" bandwidth capacity with other companies, allowing
the Company to inflate its reported revenues, in violation of
Generally Accepted Accounting Principles ("GAAP"). Specifically,
Global Crossing would contract with telecommunications carriers
to sell bandwidth capacity on Global Crossing's fiber-optic
network. Such contracts provided the telecommunications carriers
what is known as an indefeasible right of use ("IRU") of Global
Crossing's network for a 20-year period of time. Global Crossing
would report as revenue a substantial part of the 20-year
proceeds gained from the IRU contracts, up-front, in one large
sum. Then, Global Crossing would "trade" with the same
telecommunications carriers by buying similar bandwith capacity
for nearly identical amounts, recording the cost as a capital
expense to be spread over the life of the contracts. Global
Crossing would emphasize this capital expense as separate from
operating expenses to its customers. In other words, it is
charged that defendants caused Global Crossing to improperly
recognize revenues from barter or even sham transactions. Indeed,
the Securities Exchange Commission and the Federal Bureau of
Investigation are reportedly investigating the Company's
accounting practices.
It was only on January 30, 2002, that the public began to learn
about the wrongdoing at Global Crossing when The Wall Street
Journal and Los Angles Times reported that during at least 2001,
the Company was engaged in barter transactions on which it
improperly recognized revenue in violation of GAAP. By February
4, 2002, the Company admitted that a senior officer had informed
the Company of these problems as early as August 2001. It has now
been reported that the SEC had made inquiries regarding the
Company's revenue recognition policies as early as July and
August 2000.
CONTACT: Andrew G. Tolan, Esq.
Tel. 888-476-6529 (or (888) 4-POMLAW), toll free
Email: agtolan@pomlaw.com
GLOBAL CROSSING: Kaplan Fox Seeks To Represent Investors In Suit
----------------------------------------------------------------
Kaplan Fox has filed a class action against certain Global
Crossing, Ltd. ("Global Crossing") (NYSE: GX) officers and
directors in the United States District Court for the Southern
District of New York. The suit is brought on behalf of all
persons or entities who purchased the common stock of Global
Crossing between January 2, 2001 and October 4, 2001, inclusive
(the "Class Period").
The complaint charges certain of Global Crossing's officers and
directors with violations of the Securities Exchange Act of 1934.
The complaint alleges, among other things, that during the Class
Period defendants improperly recorded revenue on the Company's
bandwidth trading contracts, in violation of GAAP, thereby
substantially overstating earnings. Additionally, defendants
failed to inform investors of the declining demand for bandwidth.
Furthermore, while the Company's shares were artificially
inflated, certain defendants engaged in heavy insider trading,
selling of a total of more than $135 million of their personal
shares. On January 22, 2002, Global Crossing declared Chapter 11
bankruptcy, making it the fourth-largest bankruptcy in U.S.
history.
Plaintiff seeks to recover damages on behalf of the Class and is
represented by Kaplan Fox & Kilsheimer LLP. The firm lists
offices in New York, San Francisco, Chicago and New Jersey.
CONTACTS: Frederic S. Fox, Esq.
Jonathan K. Levine, Esq.
Shelley Thompson, Esq.
Kaplan Fox & Kilsheimer LLP
805 Third Avenue, 22nd Floor
New York, NY 10022
(800) 290-1952
(212) 687-1980Fax:
(212) 687-7714
E-mail address: mail@kaplanfox.com
Laurence D. King, Esq.
Kaplan Fox & Kilsheimer LLP
601 Montgomery Street
San Francisco, CA 94111
(415) 772-4700
Fax: (415) 772-4707
E-mail address: mail@kaplanfox.com
GLOBAL CROSSING: Former VP Reveals Dealings With EPIK
-----------------------------------------------------
Roy Olofson, a former vice president of finance at Global
Crossing Ltd., disclosed that the Company made an asset swap with
telecom infrastructure company EPIK Communications Inc. in which
it recorded the purchase side of the transaction as capital
expenditure and the sale as revenue.
EPIK, according to an article published by the Wall Street
Journal, paid US$40 million for the right to divert some of its
telephone and data traffic through Global's Latin American fiber
routes. Global exactly offset that payment by spending US$40
million on unspecified future use of EPIK's facilities, which
include a fiber network linking Atlanta and Miami.
Global's engineers found the facilities useless.
"We traded their worthless asset for our valuable asset," Olofson
said. The Company's accountants, Olofson disclosed, recorded the
purchase as a capital expenditure, while booking the sale as
revenue.
However, according to a Global spokeswoman, the company's
accounting is "clean".
===================================
D O M I N I C A N R E P U B L I C
===================================
YORK RESEARCH: Yet To Start Construction Of Wind Project In DR
--------------------------------------------------------------
Robert Paladino, chairman of the U.S.-based power developer and
operator York Research Corporation, denied reports that
construction of a US$160-million, 115MW wind project in the
Dominican Republic has already started, Business News Americas
reports.
Paladino announced that the Company is still in the final
development stage of the project and said that it could go ahead
by the end of this year or early 2003 after a series of
negotiations with the government are completed.
The talks will focus on the modification of a 30-year power
purchase agreement with state power company CDE to reflect the
delayed schedule, and a financial guarantee from the government
that has to be approved by the Dominican senate.
York is facing an involuntary bankruptcy filing from creditors
after defaulting on its senior secured bonds last October.
Meanwhile, although it is selling certain assets to ease the
credit situation, the Dominican project is not one of those
assets.
On October 30, 2001, York Research defaulted on a $10.3 million
portfolio bond payment. The collateral for the defaulted
portfolio bonds included York's interest in its Trinidad, Big
Spring, Brooklyn Navy Yard, and Warbasse projects.
Previously, fellow US power company NRG agreed to buy York's
215MW cogeneration plant in Trinidad & Tobago for US$140 million,
but later decided to pull out of the deal. The plant, according
to Paladino, has a 96-percent availability factor and is
operating well.
CONTACT: Corporate Communications, York Research Corporation,
+1-212-557-6200
=============
E C U A D O R
=============
BANCO DEL PACIFICO: Privatization Delayed Until 2003
----------------------------------------------------
Ecuadorian government-run bank Banco del Pacifico won't be sold
until 2003, revealed a high-ranking executive of the bank. The
sale, according to the executive, whose name was not revealed,
will be postponed due to this year's elections.
Also contributing to the Ecuadorian authorities' decision to
delay the process is the financial crisis in Argentina, which is
scaring off international investors to invest in Latin America.
Pacifico is planning to cut operating costs and improve
performance this year in order to become more attractive for
investors in 2003. Cost cutting measures reportedly include
slashing the workforce from 2,120 to 350 and closing several
branches.
Authorities also plan to increase the bank's market share this
year from 8 percent of the domestic banking market to 12-15
percent.
Pacifico was intervened and taken over by the government during
Ecuador's 1998-1999 financial crisis, and was supposed to be
privatized this year.
In October 2001, Interdin & Ahead Advisory took over the bank's
management in a bid to make Pacifico more attractive to foreign
investors.
In 2001, Pacifico held 7.3 percent of the overall bank deposits
in Ecuador. In October, the bank had assets of US$497.7 million,
liabilities of US$433.8 million, and losses of US$61.6 million.
CONTACTS: BANCO DEL PACIFICO:
Ec. Javier S nchez Pulley, Presidente del Directorio
Dr. F‚lix Herrero Bachmeier, Presidente Ejecutivo
P. Ycasa 200 GUAYAQUIL EuroADOR
Tel: + 593 566010
Fax: + 593 564636
=============
J A M A I C A
=============
KAISER ALUMINUM: Jamaica Assures Security Of Local Operations
-------------------------------------------------------------
Jamaica's mining and energy minister announced that officials
would work with Kaiser Aluminum Corp. to ensure its bauxite mines
in the country continue production in the wake of the parent
company's bankruptcy filing.
"We are looking at all of our options at this time, but what I do
want to stress is that we are willing to work with Kaiser because
they've been a valuable partner for many years," Mining and
Energy Minister Anthony Hylton said.
Kaiser filed for protection from creditors under Chapter 11 of
U.S. bankruptcy laws Tuesday, raising questions about possible
effects in Jamaica, where the mining and processing of bauxite -
a key ingredient in aluminum - is the second-largest foreign
currency revenue source, behind tourism.
But Hylton, on Tuesday, assured lawmakers that Kaiser's Jamaican
subsidiaries and its non-U.S. operations were excluded from its
bankruptcy filing.
Hylton says Kaiser's subsidiaries employ about 4,000 people in
Jamaica. The company's two major subsidiaries in Jamaica include
Kaiser Jamaica Bauxite Co., which mines bauxite on the north
coast and is 49 percent owned by Kaiser Aluminum and 51 percent
owned by Jamaica's government; and Alumina Partners of Jamaica,
which mines bauxite on the south coast and is 65 percent under
Kaiser Aluminum ownership and 35 percent owned by Hydro Aluminum
of Norway.
Kaiser, in its bankruptcy filing, listed US$3.3 billion in assets
and US$3.1 billion in debt.
To Kaiser's financial statements:
http://bankrupt.com/misc/KaiserAluminum.txt
CONTACT: Kaiser Aluminum Corporation, Houston
Scott Lamb, 713/267-3826
or
Richard Tauberman, 713/267-3630
or
Jamie Schwartz, 713/267-3630
KAISER ALUMINUM: S&P Lowers Remaining Issue To 'D'
--------------------------------------------------
Standard & Poor's said Tuesday that it was lowering its senior
unsecured debt rating on Houston, Texas-based Kaiser Aluminum &
Chemical Corp. to 'D' from double-'C' following the company's
announcement that it has filed for Chapter 11 bankruptcy
protection.
Standard & Poor's also said that it was removing its ratings on
Kaiser from CreditWatch but that its ratings on Kaiser's parent,
MAXXAM Inc., as well as MAXXAM subsidiary Pacific Lumber Co.
remain on CreditWatch with negative implications. Total debt at
Kaiser was a little more than $900 million.
Standard & Poor's credit analyst Thomas Watters said, "Kaiser's
financial profile deteriorated as a result of weak aluminum
demand and prices as a result of the economic recession. In
addition, increased asbestos litigation expenses and rising
retiree medical and pension costs have negatively affected
Kaiser's cash flow and impaired its financial flexibility. Kaiser
is seeking Chapter 11 protection so that it can attempt to
reorganize its financial structure."
Standard & Poor's said that it had recently lowered Kaiser's
corporate credit rating and senior subordinated debt ratings to
'D' when the company missed its $25.5 million interest payment on
its 12.3/4% senior subordinated notes. Standard & Poor's ratings
on Maxxam Inc. and Pacific Lumber Co. were placed on CreditWatch
on Jan. 15, 2002, due to ongoing concerns about whether or not
Maxxam will face financial obligations in respect to Kaiser as
well as concerns regarding the poor wood product market
conditions that are affecting Pacific Lumber. A complete list of
ratings is available on RatingsDirect, Standard & Poor's on-line
credit research service, or by calling the Standard & Poor's
ratings desk at (1) 212-438-2400.
Analyst: Thomas Watters, New York (1) 212-438-7818; Paul Vastola,
New York (1) 212-438-7816
===========
P A N A M A
===========
BLADEX: Moody's Cuts Ratings On Possible Argentine Loan Defaults
----------------------------------------------------------------
Moody's Investors Service lowered its deposit, debt, and issuer
ratings for Banco Latinoamericano de Exportaciones S.A. (BLADEX),
a Panama-based bank specializing in Latin American trade finance,
on possible Argentine loan defaults.
Moody's lowered the bank's rating two notches to `Baa3,' its
lowest investment-grade level, and said the outlook for Bladex
was "negative."
Moody's also lowered the bank's financial strength rating to D
from C, also with negative outlook.
According to the ratings agency, continuing uncertainties with
respect to the timing and terms of Argentine private and public
sector debt repayments as well as to the size of potential losses
will continue to constrain the bank's earnings and asset quality
in the near term, and prejudice the bank's growth prospects.
Bladex has lent about US$1.05 billion, or 18 percent of its
loans, to Argentine borrowers, many of whom are unable to pay
their foreign debts because of foreign exchange controls, Moody's
said in a statement.
The ratings company revealed that Bladex has set aside US$106
million in loan loss provisions and cutting costs to reduce the
impact of potential loans defaults by Argentine borrowers.
For the year 2001, BLADEX reported US$2.5 million in net income
down from US$97.1 million in 2000, reflecting extraordinary
provisions taken in the fourth quarter to cover potential losses
on the Argentine portfolio. Returns on assets and equity declined
to .04 percent and .38 percent from 1.79 percent and 14.07
percent, respectively. As of December 31, 2001, BLADEX had US$5.9
billion in assets, US$4.7 billion in loans, and US$599 million in
equity.
CONTACTS: New York
Gregory W. Bauer
Managing Director
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
New York
Jeanne Del Casino
Vice President - Senior Analyst
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
BANCO LATINOAMERICANO DE EXPORTACIONES, S.A.
Jos‚ Casta¤eda, CEO
Sebastiao Toledo Cunha, Chairman of the Board
Tatiana Calzada, Legal Counselor
Christopher Hesketh, Senior Vice-President for
Treasury
Carlos Yap, VP, Finance & Performance Management
THEIR ADDRESS:
Calle 50 and Aquilino de la Guardia
P.O. Box 6-1497, El Dorado Panama,
Republic of Panama
PHONE: (507) 210-8500
WEBSITE: http://www.blx.com/
NEW YORK AGENCY:
BLADEX
641 Lexington Avenue, 32nd Floor
New York, NY 10022
Tel 212-840-5400 / 212-754-9191
fax (212) 753-9060 / 212-751-5923
e-mail: nyoffice@blx.com
Representative Offices:
Argentina, Paraguay, Uruguay
Ave. Corrientes 617, 9§ Piso
C¢digo Postal 1043
Buenos Aires, Argentina
Telephone: (54-11) 43263584
(54-11) 43939986
Fax: (54-11) 43263579
e-mail: jdegourville@blx.com
BLADEX: Company Profile
-----------------------
NAME: BANCO LATINOAMERICANO DE EXPORTACIONES, S.A.
Calle 50 and Aquilino de la Guardia
P.O. Box 6-1497, El Dorado Panama,
Republic of Panama
PHONE: (507) 210-8500
WEBSITE: http://www.blx.com/
EXECUTIVE MANAGEMENT TEAM:
Jos‚ Casta¤eda, CEO
Sebastiao Toledo Cunha, Chairman of the Board
Tatiana Calzada, Legal Counselor
INVESTOR RELATIONS:
Christopher Hesketh, Senior Vice-President for Treasury
Carlos Yap, VP, Finance & Performance Management
Tel. No. (507) 210-8581, e-mail: cyap@blx.com,
TYPE OF BUSINESS: Based in Panama City, Banco Latinoamericano de
Exportaciones, S.A. (BLADEX) is a multinational bank created by
the Central Banks of the Latin America and the Caribbean
countries, specialized in foreign trade in this region. BLADEX
specializes in financing foreign trade for Latin American and
Caribbean countries. BLADEX's core business is short-term finance
for its 270 clients, primarily other banks, in nearly 25
countries, including Brazil and Mexico. BLADEX's main source of
funds is interbank deposits, placements in international markets,
and short-term borrowings from other international banks. The
bank also offers trade financing to select private corporations.
Its client banks make loans to government institutions involved
in foreign trade. BLADEX offers no retail services.
SIC: Banking
EMPLOYEES: 197
SALES: $405.0 (millions, Year end 2001)
TOTAL ASSETS:
TOTAL LIABILITIES:
REVENUES: 33.9 (millions, ending 4Q 2000)
PUBLIC SECURITIES: 18,101,751 Total shares outstanding, ended
December 31, 2001
AUDITOR: KPMG Peat Marwick
P.O. Box 5307, Panama 5
Republic of Panama
Telephone: (507)263-5677 / (507)215-7615
Fax: (507) 263-9852
E-Mail: kpmgpma@sinfo.net
http://www.kpmg.com.pa/
Contacts: Alberto Diamond, Senior Partner,
Email: adiamond@kpmg.com.pa
=============
U R U G U A Y
=============
GALICIA URUGUAY: Ops Suspended For 90 Days On Liquidity Problems
----------------------------------------------------------------
The board of Uruguay's Central Bank suspended the activities of
the Uruguayan subsidiary of Argentine bank Banco Galicia for at
least 90 days due to poor liquidity. The company also appointed
an accountant, Mario Caballero, to oversee the bank.
Banco Galicia Uruguay SA lost US$500 million, or a third of
deposits, since November. Most of its depositors are Argentine
and unable to take out funds from banks in their own country
because of government restrictions. Without the limits on
withdrawals and money transfers, many Argentine banks would fail,
analysts said.
"Depositors are saying they don't want to be in any Argentine
bank," said Gaston Danio, an analyst at brokerage Capital Markets
Argentina. "It's going to be very hard to recover confidence."
Banco Galicia's depositors in Uruguay pulled funds on concern the
bank would collapse after Argentina defaulted on US$95 billion of
bonds, seized deposits and devalued its currency, analysts said.
Banco Galicia is assessing whether to shut down the five
Uruguayan branches, board members said.
The bank plans to pay back deposits in Uruguay as it collects on
loans, most of which were made to Argentine clients, said Daniel
Llambias, a board member of the Argentine bank. About 70 percent
to 80 percent of loans come due within two years, he said.
"A significant part of the deposits will be paid back within two
years and the rest in three to five years," said Llambias.
Banco Galicia Uruguay, the country's second-biggest bank after
Banco Comercial, has lost a third of the US$1.5 billion of
deposits it had in late November. As of Dec. 31, the bank had
US$1.67 billion of assets and US$231 million of shareholders
equity, the bank said.
According to Guillermo Laje, a board member, Galicia's Uruguayan
bank has enough assets to remain solvent, though it lacked cash
to cover withdrawals.
***********
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 American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Fe Ong Va¤o, Editors.
Copyright 2002. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to
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