/raid1/www/Hosts/bankrupt/TCRLA_Public/020401.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

            Monday, April 1, 2002, Vol. 3, Issue 63

                           Headlines



A R G E N T I N A

PECOM ENERGIA: Pesofication Prompts S&P Ratings Drop To SD
REPSOL YPF: Huge Costs Mean Parent To Cut or Stop Investments
TELEFONICA DE ARGENTINA: Moody's Reviews B2 Forex, May Downgrade
TRANSENER: S&P Cuts Rating To SD On Currency Pesofication


B R A Z I L

COPEL: 4th-Qtr Net Income Up On Currency Gains
EMBRAER: Shares Drop On Q4 Cashflow Concerns
GLOBO CABO: Restructuring Prompts Senior Management Shake-Up
XEROX CORP: Signs Equipment Financing Deals for Brazil, Mexico


C O L O M B I A

COLTEJER: New Customs Rules May Smooth Customer Relations


M E X I C O

GRUPO MEXICO: Pritzker Fund Dumps SPCC Stake
ZURICH AFORE: Principal Financial To Acquire Mexican Unit


V E N E Z U E L A

BANCAFE: Moody's Changes Outlook To Negative On Mounting Debt
BANCO DE BOGOTA: Moody's Assigns Negative Outlook
BANCOLOMBIA: Increased Repayment Risk Prompts `Negative' Outlook
BANCO POPULAR: Country's Growing Debt Lowers Moody's Outlook
BBV BANCO GANADERO: Moody's Warns on Government, Public Debt


     - - - - - - - - - -


=================
A R G E N T I N A
=================

PECOM ENERGIA: Pesofication Prompts S&P Ratings Drop To SD
----------------------------------------------------------
Credit rating agency Standard & Poor's (S&P) downgraded to SD
(Selective Default) the rating on Argentine energy group Pecom
Energia S.A., which is more than 98-percent controlled by Perez
Companc. The Central Bank-imposed pesofication of dollar debts
constitutes an event of default, the ratings agency said.

S&P said the SD rating does not mean insolvency but rather the
lack of fulfillment of the original terms of one or more
obligations.

Following pesofication, a new rating will be assigned according
to the ability of the Company to meet its commitments in the
future, taking into consideration the new conditions of the
debts, S&P said.

Earlier this month, Pecom Energia announced a fourth-quarter loss
of ARS148 million, owing mainly to the impact of January's
devaluation on foreign currency debts.

In a recently issued statement, the Company commented with regard
to its financial liabilities saying it maintains permanent
contact and good relations with all of its creditors. The Company
is undertaking discussions to obtain new financing in order to
repay part of its debt maturing in 2002. The Company also
reiterated its intentions to continue meeting all of its
obligations.

Pecom Energia S.A. is the largest independently owned energy
company in the Latin American region. Its business activities
include oil and gas production and transportation, refining and
petrochemicals, power generation, transmission and distribution
as well as forestry activities. Headquartered in Buenos Aires,
the Company has operations throughout Argentina, Brazil,
Venezuela, Bolivia, Peru and Ecuador.

CONTACTS:  Pecom Energia S.A. de Perez Companc S.A.
           Maipo 1 - Piso 22 - C1084ABA
           Buenos Aires, Argentina
           Phone: (54-11) 4344-6000
           Fax: (54-11) 4344-6315
           URL: http://www.pecom.com.ar


REPSOL YPF: Huge Costs Mean Parent To Cut or Stop Investments
-------------------------------------------------------------
Analysts predict that Repsol YPF SA, along with other Spanish
companies such as Telefonica SA with investments in Argentina,
face costs of more than EUR3 billion (US$2.6 billion) this
quarter from Argentina's slumping currency, reports Bloomberg.

The costs include a decline in earnings of more than EUR1.1
billion. The companies may also have to write down the value of
their assets by more than EUR2 billion because of the peso's 70
percent plunge this quarter, analysts said.

"As a direct effect of the devaluation, some companies may have
to double existing provisions for Argentina," said Francisco
Salvador, director of equities at Ahorro Corporacion Financiera
in Madrid, which manages EUR9 billion.

The additional costs this quarter add to the EUR9 billion in
losses and charges taken by Spanish companies in 2001 because of
the weaker peso. That brings total costs to more than EUR12
billion, almost half the EUR28 billion invested by Spanish
companies in Argentina.

According to analysts, the costs may put pressure on the
companies to reduce their presence in the South American country,
or at least halt investment there.

CONTACTS:  REPSOL YPF
           Alfonso Cortina De Alcocer, Chairman & CEO
           Ramon Blanco Balin, Vice Chairman
           Carmelo De Las Morenas Lopez, CFO

           Their Address:
           Paseo de la Castellana 278
           28046 Madrid, Spain
           Phone   +34 91 348 81 00
           Home Page: http://www.repsol.com
           or
           Av. Roque S enz Pe a, 777.
           C.P 1364. Buenos Aires
           Argentina


TELEFONICA DE ARGENTINA: Moody's Reviews B2 Forex, May Downgrade
----------------------------------------------------------------
Moody's Investors Service placed the B2 long-term foreign
currency debt ratings of Telefonica de Argentina Sociedad Anonima
(TASA) on review for possible downgrade in the wake of the
Argentinean government's imposition of new restrictive measures.

The ratings agency said it would assess the increased uncertainty
with regard to TASA's ability to make future dollar-denominated
payments under the new restrictive regulations, which would
prevent Argentinean-domiciled companies from making any payments
in foreign currency.

Furthermore, Moody's said it would review the possibility that
Telefonica SA might not provide TASA with US dollars for its
future foreign currency payments.

Telefonica SA owns 98 percent of TASA.

Moody's noted that TASA's current B2 foreign currency bond rating
is five notches above Argentina's Ca long-term foreign currency
ceiling for bonds and notes.

The rating agency allowed TASA to pierce the Argentinean country
sovereign ceiling based on the perceived implicit support from
Telefonica SA, and the strategic value of TASA.

The ratings review process affects Telefonica de Argentina SA's
MTN Program and all drawdowns, issuer rating and senior implied
rating.


TRANSENER: S&P Cuts Rating To SD On Currency Pesofication
---------------------------------------------------------
Standard & Poor's (S&P) cut its rating on Argentine transmission
company Companhia de Transporte de Energia Electrica en Alta
Tension (Transener S.A.) to SD following the Central Bank's
imposition of pesofication of dollar debts.

For S&P, The Central Bank-imposed pesofication represents a
technical default. However, the credit rating agency said that
the SD rating does not mean insolvency, but rather the lack of
fulfillment of the original terms of one or more obligations.

Following pesofication, new ratings will be assigned according to
the ability of the Company to meet its commitments in the future,
taking into consideration the new conditions of the debts, S&P
said.

The devaluation of the Argentine peso has led Transener to post
losses of up to ARS494 million. The impact of the devaluation is
mainly due to a dollar-denominated debt of almost US$270 million,
which relates to the 1,290km Cuarta Linea (Fourth Line)
transmission project linking the south with the center of the
country. Transener charges access rights for the line in pesos.

The loan, according to a company source, "was not taken out by
Transener for financial initiatives, but to invest in the Cuarta
Linea, for which, in accordance with the concession, it would
receive royalties that are now in pesos, but the Company's debt
is in dollars and with devaluation this leaves an enormous margin
of loss."

Transener has 14,200km in transmission lines, including 5,500km
of the network of its subsidiary Transba. Transener is 65-percent
controlled by the Citelec consortium, formed by the UK's National
Grid (42.9 percent), Argentina's Perez Companc (42.9 percent),
and investment funds The Argentine Investment Co. and IRHE
Holdings, with 7.5 percent each.

CONTACTS:  Compania de Transporte de Energia Electrica en Alta
           Tension (Transener S.A.)
           Av. Paseo Colon 728, 6"Piso - (1063)
           Buenos Aires, Argentina
           Tel. (5411) 4342-6925

           Business Development:
           Carlos A. Jeifetz (jeifecar@transx.com.ar)
           Gerardo Baseotto (baseoger@transx.com.ar)
           Tel.: (54-11) 4334-0182 / 4342-6925
           Fax: (54-11) 4342-4861



===========
B R A Z I L
===========

COPEL: 4th-Qtr Net Income Up On Currency Gains
----------------------------------------------
Brazil's second-largest power company Cia. Paranaense de Energia
saw its fourth-quarter net income increase to BRL385.9 million
(US$165 million), from BRL141.9 million posted in the same period
a year earlier.

Copel, as the Company is known, benefited from a reduction in
foreign currency debt converted into local currency after a 16
percent, fourth-quarter gain by the real against the U.S. dollar.

Total debt fell to BRL1.4 billion from BRL1.62 billion at the
end of the third quarter as a result of currency gains, the
Company said. Dollar-denominated debt fell to BRL869 million from
BRL1.05 billion.

Sales, according to the Company, rose 12 percent to BRL636
million from BRL567 million a year earlier after rate increases.
On the news, Copel shares rose nearly 1 percent to BRL17.45 on
the Sao Paulo Stock Exchange.

The Brazilian state of Parana, which owns Copel, had intended to
sell about 89 percent of Copel's voting, or common, shares for at
least BRL5.07 billion (US$2.1 billion) early this year. However,
the state scrapped its planned sale after changes in government
energy policy and debt default in Argentina scared off potential
investors.

Copel has 17 hydroelectric plants and one thermoelectric plant
with a total capacity of over 4,500 megawatts.

CONTACTS:  Ingo Henrique Hobert, Chief Executive Officer
           Deni Lineu Schwartz, Chief Government Relatins Officer
           Ferdinando schauenburg, CFO

           THEIR ADDRESS:
           Companhia Paranaense de Energia (COPEL)
           Dulcidio, 800
           Batel  80420-170 Curitiba - PR
           Brazil
           Phone   +55 41 322-3535
           Home Page http://www.copel.com

           INVESTOR RELATIONS
           Ricardo Portugal Alves
           Email: Ricardo.portugal@copel.com
           AND
           Othon M,der Ribas
           Email: othon@copel.com


EMBRAER: Shares Drop On Q4 Cashflow Concerns
--------------------------------------------
Shares of Brazilian aircraft manufacturer Embraer plummeted after
it published fourth-quarter results last Tuesday showing negative
net cashflow of US$23 million at the end of 2001 against a
positive US$723 million at the end of 2000, says Reuters.

Analysts believe that Embraer's ability to fund its own
investments would now be more expensive after it dipped into its
own pocket to finance deals with customers as loans from banks
dried up following the attacks on the United States.

"When it (Embraer) has lots of cash, it doesn't need to go to the
market to get financing," said BES Securities analyst Rafael
Quintanilha. "When it is reduced, that cost goes up."

Quintanilha said he was currently revising his price target and
had changed his recommendation on the stock to neutral from buy.

Embraer stock dropped 5 percent to BRL11.74 in Brazil and its
American Depository Receipts (ADR) were 4.8 percent weaker at
US$20.08 in New York.

The world's No.4 aircraft maker attributed the decline in its
cash position on a big jump in inventories as parts built up
while aircraft deliveries were disrupted and a large increase in
the money it was owed for products that had been sold.

Inventories jumped 78 percent to US$1.0 billion, while accounts
receivable more than tripled to US$671.6 million.

"Embraer gave us a fright in its (fourth quarter) numbers when
the expected rebound in net cash failed to materialize," UBS
Warburg analyst Stephen Graham said in a note. Graham slashed his
target price for Embraer's ADRs to US$21 from US$23 in view of
the cash position.

CONTACTS:  EMBRAER
           Press office:
           Phone +55 12 3927 1311
           Fax + 55 12 3927 2411
           Press office mgr. Bob Sharp
           Email: bob.sharp@embraer.com.br
              OR
           Press officer Wagner Gonzalez
           Email: wagner.gonzalez@embraer.com.br


GLOBO CABO: Restructuring Prompts Senior Management Shake-Up
------------------------------------------------------------
Globo Cabo, Brazil's leading MSO, is undergoing significant
changes in its senior management ranks, according to
Multichannel News International. As part of its restructuring
efforts, two of the Company's long-standing directors -- Luiz
Fernando Baptistella, director of infrastructure and technology,
and Oscar Simoes, director of human resources -- will leave the
company in April, although no replacements have been named yet.

These changes follow the arrival of a new CEO last September,
Luiz Antonio Viana, who begun what analysts believe to be a major
restructuring process at Globo Cabo, which last year reported a
net loss of US$302 million and saw its subscriber base fall by
2.8 percent.

Simultaneously, Globopar, the holding company of Brazil's largest
media group Organiza‡oes Globo that owns Globo Cabo, also
announced management changes.

Philippe Reichstul, who became CEO at Globoar last February, has
appointed Ronnie Vaz Moreira as the company's new executive
director.

Moreira formerly worked as finance director at local oil company,
Petrobras, and as executive director of the Brazilian division of
Deutsche bank. He replaces Mauro Molchansky.

To see financial statements:
http://bankrupt.com/misc/globo_cabo.pdf

CONTACT:  GLOBO CABO
          Investor Relations:
          Luis Henrique Martinez, +5511-5186-2684,
          lmartinez@globocabo.com.br

          Marcio Minoru, +5511-5186-2811,
          minoru@globocabo.com.br


XEROX CORP: Signs Equipment Financing Deals for Brazil, Mexico
--------------------------------------------------------------
In an official company press release, Xerox Corporation (NYSE:
XRX) announced Wednesday that it has made further progress in
transitioning equipment financing to third parties.

Designed to significantly restructure Xerox's balance sheet
through the reduction of debt, Xerox's vendor financing strategy
also ensures that customers continue to quickly and easily obtain
the Xerox equipment they need through flexible financing
arrangements.

In the past month, the company has taken the following steps to
move forward this key element of its turnaround strategy:

-   Received $266 million of financing from GE Capital, secured
    by portions of Xerox's lease receivables in the United
    States. This securitization is in addition to the
    approximately $1.2 billion of U.S. financing received last
    year from GE Capital. The $266 million amortizes over a
    period that extends into 2005.

-   Received $291 million of financing from GE Capital, secured
    by portions of Xerox's lease receivables in Canada. This
    arrangement too amortizes over a period that extends into
    2005.

-   Completed an agreement with Banco Itau, S.A to become the
    primary source of equipment financing for Xerox customers in
    Brazil. It is expected that beginning April 1, Banco Itau,
    S.A will provide the equipment financing for all new
    activations.

-   Completed an agreement with CIT Group affiliates in Mexico to
    become the primary source of equipment financing for Xerox
    customers in Mexico beginning in the second quarter of this
    year.

-   Activated the previously announced joint venture with De Lage
    Landen to manage equipment financing, billing and collections
    for the financing of Xerox equipment in the Netherlands. DLL
    owns 51 percent of the joint venture and provides the funding
    to support all new customer leases. Xerox owns the remaining
    49 percent.

-   Secured a preliminary agreement to transfer Xerox's equipment
    financing operations in Italy to a financing partner for $230
    million. In addition to purchasing Xerox's existing lease
    portfolio in Italy, the partner will also provide ongoing,
    exclusive equipment financing for new activations. Pending
    final regulatory approval, this agreement is expected to be
    complete in April at which time more details will be
    disclosed.

With the recent receipt of this funding from GE Capital, Xerox's
worldwide cash balance has increased to approximately $4.8
billion.

CONTACT:  Xerox Corporation, Rochester
          Media Contact:
          Christa Carone, 585/423-5074
          Email: christa.carone@usa.xerox.com



===============
C O L O M B I A
===============

COLTEJER: New Customs Rules May Smooth Customer Relations
---------------------------------------------------------
Colombian textile group Compania Colombiana de Tejidos (Coltejer)
is looking to improve existing client relations and pave the way
for new US client relations by anticipating the extension of the
'Atpa' and the favorable customs duty agreements for the textile
sector, reports Portafolio.

Coltejer, which, in December 1999, executed a Reorganization
Agreement under the provisions of the Ley 550 umbrella, managed
to post profits of COP10.042 billion (when consolidated alongside
Textiles Rionegro). Economic Intervention Law (Ley 550) is a
Colombian regulation allowing indebted firms to seek out debt
restructuring.

The recent profits will be used to offset losses posted in the
previous years.

Coltejer was able get back in the black after it benefited from a
plunge in international textile purchasing and successful anti-
contraband campaigns.

The firm's debt restructuring program has already convinced
creditors such as Magnun Logistics, Intergrupo Limitada,
Industria del Maiz and Trenzados Medellin, to recharacterize
certain amounts owed.

CONTACT:  Colombiana de Tejidos S.A. (Coltejer)
          CRA. 42 # 54A - 161
          Autopista Sur
          Itagui, Colombia
          Tel. (57) 3731133
          Website: http://www.coltejer.com.co



===========
M E X I C O
===========

GRUPO MEXICO: Pritzker Fund Dumps SPCC Stake
--------------------------------------------
Pritzker Family Philanthropic Fund liquidated its 20 percent
stake in Southern Peru Copper Corp. (SPCC), according to an
amended Schedule 13D filed recently with the Securities and
Exchange Commission. The official documents indicate the fund
sold 2.85 million shares between Jan. 25 and March 7 for prices
ranging from US$10.43 to US$10.50.

Mexico City-based mining transport Grupo Mexico, through its US
subsidiary Asarco, owns 54.3 percent in SPCC. Grupo Mexico is
struggling with a debt load of US$2.5 billion, which is partly
the result of its acquisition of Asarco. It has sought to control
costs by suspending operations at Asarco smelters in Helena,
Montana, and El Paso, Texas.

Financial analysts predict that any future financial
restructuring would likely involve SPCC. Grupo Mexico could sell
its interest in SPCC, or move to strip it from Asarco and place
it elsewhere in the corporate structure.

CONTACTS:  GRUPO MEXICO S.A. DE C.V
           Avenida Baja California 200,
           Colonia Roma Sur
           06760 Mexico, D.F.
           Mexico
           Phone: +52-55-5264-7775
           Fax: +52-55-5264-7769
           http://www.gmexico.com
           Contacts:
           German Larrea Mota-Velasco, Chairman & CEO
           Xavier Garcia de Quevedo Topete, President & COO

           SOUTHERN PERU COPPER CORPORATION
           Ave. Caminos del Inca 171
           Urb. Chacarilla del Estanque
           Santiago de Surco
           Lima 33, Peru
           Tel: +51 1 372 1414
           Fax: +51 1 372 0238
           Home Page: http://www.southernperu.com
           Contacts:
           German Larrea Mota-Velasco, Chairman & CEO
           Oscar Gonzalez Rocha, President & Director General
           Daniel Tellechea Salido, VP - Finance

           ASARCO, INC.
           2575 E. Camelback Rd., Ste. 500
           Phoenix, AZ 85016
           Phone: 602-977-6500
           Fax: 602-977-6701
           Home Page: http://www.asarco.com
           Contacts:
           German Larea Mota-Velasco, Chairman & CEO
           Genaro Larrea Mota-Velasco, President
           Daniel Tellechea Salido, VP & CFO


ZURICH AFORE: Principal Financial To Acquire Mexican Unit
-------------------------------------------------------------
The Principal Financial Group(R) announced Monday that it had
reached an agreement with Zurich Financial Services Group to
acquire Zurich Afore S.A. de C.V., Zurich's private pension
operation in Mexico.

Pending regulatory approval, Zurich Afore will merge with the
Mexican pension fund business of The Principal(R), Principal
Afore S.A. de C.V.

Principal Afore is one of the fastest growing pension providers
in Mexico, and has more than tripled the number of its customers
over the past three years.

Zurich Afore currently serves more than 800,000 private pension
customers, while Principal Afore's business serves nearly 1.4
million customers.

Credit Suisse First Boston advised the Principal Financial Group
on the transaction.

Embattled Zurich Financial Services has a three-year-in-the-
making project that's sitting idly in a Zurich Financial data
center.

The ambitious project, which is part of the US$1-billion dream of
CEO Rolf Hueppi to turn the company into an "e-business
powerhouse," has already gobbled up US$250 million and is now
deemed a "white elephant" with little or no use at all. This
latest transaction brings to two the number of failed projects
included in that Mr. Hueppi's so-called dream.

The company declined to say whether it will write down the
exchange project, reiterating its December forecast for the group
that it would write down investments by a total US$900 million in
2001, including US$100 million in private equity investments.

Zurich reported a US$387 million loss for 2001. Earlier this
month, Hueppi said he'd step down as CEO by mid-year, though he
will remain on as chairman.

CONTACT:  The Principal Financial Group, Des Moines
          Media Contacts:
          Sheila Streicher, 515/247-6639
          streicher.sheila@principal.com
          or
          Terri Shell, 515/283-8858
          shell.terri@principal.com
          or
          Investor Relations:
          John Effrein, 515/235-9500
          investor-relations@principal.com

          CREDIT SUISSE GROUP
          P.O. Box 1
          CH-8070 Zrich
          Tel. +41 (1) 212 16 16
          Fax. +41 (1) 333 25 87
          Contact: Lukas Muehlemann, chairman & CEO



=================
V E N E Z U E L A
=================

BANCAFE: Moody's Changes Outlook To Negative On Mounting Debt
-------------------------------------------------------------
Moody's Investors Service changed its outlook on Bancafe S.A.'s
Ba3 long-term foreign-currency bank deposit rating to `negative'
from `stable.'

The change in the bank's rating outlook directly follows Moody's
outlook change to negative for Colombia's Ba2 foreign-currency
ceiling for bonds and notes, and the Ba3 foreign-currency ceiling
for bank deposits.

The ratings agency cut its outlook on Colombia's foreign and
local currency debt on concern about the country's growing public
debt.

Moody's noted "despite the narrowing of the fiscal deficit, the
public debt numbers continued to report an upward trend in recent
years."

Moody's believes that, in order to stabilize public debt ratios,
the Colombian government will have to undertake continued and
additional fiscal adjustments -- a move it considers difficult
given the prevailing low-growth environment.

Moody's outlook change on the country ceilings reflects the
increased risk that the resolve of the authorities to make full
and timely payments on its debt may be tested. The government's
large overall financing needs, the lack of an adequate fiscal
adjustment, and low oil prices all have the potential, in
combination, to lead to significant macroeconomic problems.

CONTACT:

New York
Philip J. Guarco
VP - Senior Credit Officer
Moody's Investors Service

New York
Gregory W. Bauer
Managing Director
Moody's Investors Service


BANCO DE BOGOTA: Moody's Assigns Negative Outlook
-----------------------------------------------------------
Moody's Investors Service changed its outlook on Banco de Bogota
S.A.'s Ba3 long-term foreign-currency bank deposit rating to
`negative' from `stable.'

The change in the bank's rating outlook directly follows Moody's
outlook change to negative for Colombia's Ba2 foreign-currency
ceiling for bonds and notes, and the Ba3 foreign-currency ceiling
for bank deposits.

The ratings agency cut its outlook on Colombia's foreign and
local currency debt on concern about the country's growing public
debt.

Moody's noted "despite the narrowing of the fiscal deficit, the
public debt numbers continued to report an upward trend in recent
years."

Moody's believes that, in order to stabilize public debt ratios,
the Colombian government will have to undertake continued and
additional fiscal adjustments -- a move it considers difficult
given the prevailing low-growth environment.

Moody's outlook change on the country ceilings reflects the
increased risk that the resolve of the authorities to make full
and timely payments on its debt may be tested. The government's
large overall financing needs, the lack of an adequate fiscal
adjustment, and low oil prices all have the potential, in
combination, to lead to significant macroeconomic problems.

CONTACT:

New York
Philip J. Guarco
VP - Senior Credit Officer
Moody's Investors Service

New York
Gregory W. Bauer
Managing Director
Moody's Investors Service


BANCOLOMBIA: Increased Repayment Risk Prompts `Negative' Outlook
----------------------------------------------------------------
Moody's Investors Service changed its outlook on Bancolombia
S.A's Ba3 long-term foreign-currency bank deposit rating to
`negative' from `stable.'

The change in the bank's rating outlook directly follows Moody's
outlook change to negative for Colombia's Ba2 foreign-currency
ceiling for bonds and notes, and the Ba3 foreign-currency ceiling
for bank deposits.

The ratings agency cut its outlook on Colombia's foreign and
local currency debt on concern about the country's growing public
debt.

Moody's noted "despite the narrowing of the fiscal deficit, the
public debt numbers continued to report an upward trend in recent
years."

Moody's believes that, in order to stabilize public debt ratios,
the Colombian government will have to undertake continued and
additional fiscal adjustments -- a move it considers difficult
given the prevailing low-growth environment.

Moody's outlook change on the country ceilings reflects the
increased risk that the resolve of the authorities to make full
and timely payments on its debt may be tested. The government's
large overall financing needs, the lack of an adequate fiscal
adjustment, and low oil prices all have the potential, in
combination, to lead to significant macroeconomic problems.

CONTACT:

New York
Philip J. Guarco
VP - Senior Credit Officer
Moody's Investors Service

New York
Gregory W. Bauer
Managing Director
Moody's Investors Service


BANCO POPULAR: Country's Growing Debt Lowers Moody's Outlook
------------------------------------------------------------
Moody's Investors Service changed its outlook on Banco Popular
S.A.'s Ba3 long-term foreign-currency bank deposit rating to
`negative' from `stable.'

The change in the bank's rating outlook directly follows Moody's
outlook change to negative for Colombia's Ba2 foreign-currency
ceiling for bonds and notes, and the Ba3 foreign-currency ceiling
for bank deposits.

The ratings agency cut its outlook on Colombia's foreign and
local currency debt on concern about the country's growing public
debt.

Moody's noted "despite the narrowing of the fiscal deficit, the
public debt numbers continued to report an upward trend in recent
years."

Moody's believes that, in order to stabilize public debt ratios,
the Colombian government will have to undertake continued and
additional fiscal adjustments -- a move it considers difficult
given the prevailing low-growth environment.

Moody's outlook change on the country ceilings reflects the
increased risk that the resolve of the authorities to make full
and timely payments on its debt may be tested. The government's
large overall financing needs, the lack of an adequate fiscal
adjustment, and low oil prices all have the potential, in
combination, to lead to significant macroeconomic problems.

CONTACT:

New York
Philip J. Guarco
VP - Senior Credit Officer
Moody's Investors Service

New York
Gregory W. Bauer
Managing Director
Moody's Investors Service


BBV BANCO GANADERO: Moody's Warns on Government, Public Debt
------------------------------------------------------------
Moody's Investors Service changed its outlook on BBV Banco
Ganadero S.A.'s Ba3 long-term foreign-currency bank deposit
rating to `negative' from `stable.'

The change in the bank's rating outlook directly follows Moody's
outlook change to negative for Colombia's Ba2 foreign-currency
ceiling for bonds and notes, and the Ba3 foreign-currency ceiling
for bank deposits.

The ratings agency cut its outlook on Colombia's foreign and
local currency debt on concern about the country's growing public
debt.

Moody's noted "despite the narrowing of the fiscal deficit, the
public debt numbers continued to report an upward trend in recent
years."

Moody's believes that, in order to stabilize public debt ratios,
the Colombian government will have to undertake continued and
additional fiscal adjustments -- a move it considers difficult
given the prevailing low-growth environment.

Moody's outlook change on the country ceilings reflects the
increased risk that the resolve of the authorities to make full
and timely payments on its debt may be tested. The government's
large overall financing needs, the lack of an adequate fiscal
adjustment, and low oil prices all have the potential, in
combination, to lead to significant macroeconomic problems.

CONTACT:

New York
Philip J. Guarco
VP - Senior Credit Officer
Moody's Investors Service

New York
Gregory W. Bauer
Managing Director
Moody's Investors Service



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S U B S C R I P T I O N   I N F O R M A T I O N

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