TCRLA_Public/050425.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 25, 2005, Vol. 6, Issue 80

                            Headlines


A R G E N T I N A

AEROLINEAS ARGENTINAS: FAA Grants B747/400 Flights to U.S.
CAPEX S.A.: S&P Retains Default Rating on Bonds
DISCO: Cencosud to Fight Federal Appeals Court Ruling
EDEMSA: Gets Regional Agreement for New Contract
FOREST PLAST: Enters Bankruptcy on Court Orders

GATIPRINT S.A.: Court Resets Liquidation Schedule
JJ FELICIDADES: Liquidates Assets to Pay Debts
MARKER S.A.: Verification Deadline Approaches
TRANSENER: Seeks to Settle Debt Without Bankruptcy
* ARGENTINA: Courts U.S. Support on Debt Default


B A R B A D O S

C&W BARBADOS: Reviewing Price Cap Plan Proposed by FTC


B O L I V I A

BANCO UNION: Moody's Withdraws Ratings


C H I L E

ENAP: Failed Columbian Oil Exploration Bids Lead to Loss


D O M I N I C A N   R E P U B L I C

BANCO BHD: Fitch Affirms Ratings
BANCO DOMINICANO: Ratings Affirmed After DR Ratings Change
BANCO LEON: Fitch Affirms Long-term, Short-term FC Ratings
BANCO MERCANTIL: Fitch Affirms Ratings

* DOMINICAN REPUBLIC: Fitch Lowers FC Sovereign Rating to 'C'
* DOMINICAN REPUBLIC: IMF to Support Economic Strategy


E C U A D O R

* ECUADOR: 'B-' LT Rating Placed On CreditWatch Negative


E L   S A L V A D O R

BANCO AGRICOLA: S&P Details Rasoning for Ratings
BANCO CUSCATLAN: S&P Releases Report on Ratings
MILLICOM INTERNATIONAL: Posts US$11.3M Loss for 1Q05


J A M A I C A

NCB JAMAICA: S&P Releases Analysis on Ratings


M E X I C O

AHMSA: Seeking Renewed Creditor Approval
GRUPO DESC: Posts $24M Net Income in 1Q05
GRUPO DESC: Audit Committee Reports 2004 Results to Board
GRUPO MEXICO: Net Profit Jumps 51% YOY for 1Q05
TFM: Fitch Assigns 'B+' to $460M Issuance

TV AZTECA: Signs Purchase Agreement With Harris Corporation


V E N E Z U E L A

PDVSA: CITGO Denies Allegations of Financial Distress
ROYAL SHELL: Publishes 2004 Results Under IFRS


     - - - - - - - - - -


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

AEROLINEAS ARGENTINAS: FAA Grants B747/400 Flights to U.S.
----------------------------------------------------------
The United States Federal Aviation Administration (FAA)
authorized Aerolineas Argentinas to operate its B747/400
aircraft for flights into the United States.

Category 2, granted by the FFA when Argentina passed operational
safety qualifications, prevents Argentine airlines from opening
new routes, changing destinations or incorporating new aircrafts
on its flights to the U.S.

Aerolineas has been exempted in this case after an exhaustive
audit carried out by the FAA on crew training and qualifications
as well as maintenance proceedings of the company subject to the
standards required by the United States.

The high degree of reliability on commercial air operation that
Aerolineas Argentinas has been developing through all these
years is the main reason that the airline was granted this
special authorization.

CONTACT: AEROLINEAS ARGENTINAS
         Torre Bouchard 547, 1106 Buenos Aires, ARGENTINA
         Phone: (54-11) 4310-3000
         Fax: (54-11) 4310-3585
         E-mail: volar@aerolineas.com.ar
         Web site: www.aerolineas.com.ar


CAPEX S.A.: S&P Retains Default Rating on Bonds
-----------------------------------------------
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
reaffirmed junk ratings given to Capex S.A.'s corporate bonds.
According to Argentina's securities regulator, the Comision
Nacional de Valores, the given ratings are based on the
Company's finances as of January 31, 2005.

S&P issued a `raD' rating to US$105 million of "obligaciones
negociables simples", that matured on December 23 last year. An
obligation is rated `raD' when it is payment default, or the
obligor has filed for bankruptcy, said the ratings agency.

Another US$150 million of the Company's bonds due on January 1,
2005 received a `raCC'. The bonds are also called "obligaciones
negociables simples." The same rating applies to US$40 million
of the Company's bonds. These set of bonds are classified under
"simple issue". S&P said that an obligation with this rating is
currently highly vulnerable to non-payment.


DISCO: Cencosud to Fight Federal Appeals Court Ruling
-------------------------------------------------------
A federal appeals court in Mendoza province upheld a lower
provincial judge's ruling from last year that blocked the
purchase of local supermarket chain Disco by Chilean retailer
Cencosud SA (CENCOSUD.SN). According to Dow Jones Newswires,
Cencosud is planning to file an appeal with the Argentine
Supreme Court.

Cencosud announced in November that it was paying US$315 million
to buy Disco from Dutch retailer Ahold. However, the legal
battle has complicated the Chilean company's efforts to complete
the transaction.

Argentine antitrust authorities have yet to approve the
transaction with the regulatory agency saying it cannot complete
its analysis until the legal issues are resolved. Disco and
Jumbo, Cencosud's supermarket chain in Argentina, continue to
operate as separate companies pending approval from antitrust
authorities.

In March, Ahold said it received from escrow payment for 85% of
Disco's shares. The remaining 15% is still in escrow.

CONTACT: Ahold Corporate Communications
         Royal Ahold N.V.
         P.O. Box 3050 1500 HB
         Zaandam Netherlands
         Phone: +31 (0)75 659 57 20
         Fax: +31 (0)75 659 83 02
         Web Site: http://www.ahold.com

         DISCO S.A.
         Larrea 847, Piso 1
         1117 Buenos Aires, Argentina
         Phone: +54-11-4964-8000
         Fax: +54-11-4964-8076
         Home Page: http://www.disco.com.ar


EDEMSA: Gets Regional Agreement for New Contract
------------------------------------------------
Edemsa, the power distributor serving the province of Mendoza,
revealed to the Buenos Aires Stock Exchange Thursday that it is
moving towards a new contract with the provincial government.

In a statement to the bourse, Edemsa stated that during meetings
between the Company and provincial officials, the two sides
"debated and reached a pre-accord about the terms of the 'letter
of understanding'" for a new contract between it and the
regional government.

The news about the accord comes three weeks after Electricite de
France SA (EdF) completed the sale of its stake in Edemsa's
controlling shareholder to the local Iadesa consortium.

EdF sold its 88% stake in the Sodemsa consortium that owns 51%
of Edemsa for an undisclosed amount. Iadesa, led by businessman
Jose Angulo, formerly held a 12% share in Sodemsa.

Edemsa has some 310,000 clients over its 110,000 sq. km.
concession area. Mendoza province owns 39% of Edemsa, while the
other 10% is in the hands of company employees, according to
press reports.

CONTACT:  EMPRESA DISTRIBUIDORA DE ELECTRICIDAD DE MENDOZA S.A.
          San Martin 322 (5500)
          Mendoza


FOREST PLAST: Enters Bankruptcy on Court Orders
-----------------------------------------------
Forest Plast S.A. enters bankruptcy protection after Court No. 6
of Buenos Aires' civil and commercial tribunal, with the
assistance of Clerk No. 11, ordered the company's liquidation.
The order effectively transfers control of the company's assets
to a court-appointed trustee who will supervise the liquidation
proceedings.

Infobae reports that the court selected Ms. Elena Beatriz
Tancredi as trustee. Ms. Tancredi will be verifying creditors'
proofs of claims until the end of the verification phase on June
9.

Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the company's accounting
and business records. The individual reports will be submitted
on August 5 followed by the general report that is due on
September 19.

CONTACT: Ms. Elena Beatriz Tancredi, Trustee
         Lima 131
         Buenos Aires


GATIPRINT S.A.: Court Resets Liquidation Schedule
-------------------------------------------------
Court No. 7 of Buenos Aires' civil and commercial tribunal reset
key events in the Gatiprint S.A. bankruptcy case to the
following dates:

1. Proof of Claims Submission Deadline: June 28, 2005
2. Individual Reports Submission: September 20, 2005

Mr. Jorge Stanislavsky serves as trustee on this case. Failure
to submit proof of claims within the specified period will
disqualify creditors from any post-liquidation distributions.

The city's Clerk No. 14 assists the court on this case.

CONTACT: Mr. Jorge Stanislavsky, Trustee
         Talcahuano 768
         Buenos Aires


JJ FELICIDADES: Liquidates Assets to Pay Debts
----------------------------------------------
Buenos Aires-based J.J. Felicidades S.A. will begin liquidating
its assets following the bankruptcy pronouncement issued by
Court No. 18 of the city's civil and commercial tribunal,
reports Infobae.

The ruling places the company under the supervision of court-
appointed trustee, Jorge Ernesto del Hoyo. The trustee will
verify creditors' proofs of claims until June 29. The validated
claims will be presented in court as individual reports on
August 10.

Mr. del Hoyo will also submit a general report, containing a
summary of the company's financial status as well as relevant
events pertaining to the bankruptcy, on September 21.

The bankruptcy process will end with the sale of the company's
assets.

CONTACT: Mr. Jorge Ernesto del Hoyo, Trustee
         Cerrito 484
         Buenos Aires


MARKER S.A.: Verification Deadline Approaches
---------------------------------------------
The verification of claims for the Marker S.A. bankruptcy will
end on May 26 according to Infobae. Creditors with claims
against the bankrupt company must present proof of the
liabilities to Ms. Lilian Edith Rey, the court-appointed
trustee, before the deadline.

Court No. 6 of Buenos Aires' civil and commercial tribunal
handles the company's case with the assistance of Clerk No. 11.
The bankruptcy will close with the sale of the company's assets.
Proceeds from the sale will be used to repay the company's
debts.

CONTACT: Ms. Lilian Edith Rey, Trustee
         Avda Roque Saenz Pena 651
         Buenos Aires


TRANSENER: Seeks to Settle Debt Without Bankruptcy
---------------------------------------------------
Argentine high-voltage power transporter Transener will complete
its $465-million debt restructuring without going through an
APE, reports Dow Jones Newswires.

An APE is an insolvency remedy available to debtors under the
Argentine Bankruptcy Law consisting of an out-of-court agreement
between a debtor and a certain percentage of its unsecured
creditors that is submitted to a court, whose clearance then
makes the repayment terms binding on all bondholders.

In the case of Transener, the Company had set a 97% acceptance
target to be able to settle its restructuring directly without
needing to go through an APE, which can often add weeks to the
process.

However, the Company's debt deal expired recently with a final
acceptance level of 98.8%, which meant that the Company can
bypass the APE.

Transener is swapping old debt for either a 2016 par bond, a
cash payment worth 55% of the original face value of the bonds,
or a combination of Class B shares and a 2015 discount bond with
an 18% reduction in principal.

Argentine oil and gas producer Petrobras Energia (PECO.BA) and
local investment group Dolphin Fund Management hold equal stakes
in Citelec, Transener's holding Company. Petrobras Energia is
owned by state Brazilian oil Company Petroleo Brasileiro, or
Petrobras (PBR), which promised Argentine regulators it will
sell its stake in the power transporter once Transener completes
its debt workout.

Transener didn't announce a settlement date.

CONTACT:  Paseo Colon 728 6th Floor
          (1063) Buenos Aires
          Republica Argentina
          Tel: (54-11) 4342-6925
          Fax: (54-11) 4342-7147
          Email: info-trans@transx.com.ar
          Web site: http://www.transener.com.ar



* ARGENTINA: Courts U.S. Support on Debt Default
------------------------------------------------
Argentina is seeking to gain the United States' support as it
moves to refinance almost US$14 billion in debt with the
International Monetary Fund (IMF).

El Pais reports that the country's economic minister, Roberto
Lavagna, met with US Treasury Secretary John Snow in Washington
on Monday to discuss the status of private creditors who had
spurned the country's recent debt swap.

The issue of the holdouts, making-up almost US$20 billion of
Argentina's defaulted bonds, is seen as a major obstacle towards
a new IMF accord. Group of Seven member-countries Italy, Japan
and the United Kingdom have been vocal on their desire for
stricter measures against Argentina.

The U.S., however, has expressed support for the bond swap that
had gained the approval of almost 76 percent of bondholders. The
U.S. Treasury says that it expects a realistic, but not
immediate, solution to the holdouts.



===============
B A R B A D O S
===============

C&W BARBADOS: Reviewing Price Cap Plan Proposed by FTC
------------------------------------------------------
C&W (Barbados) Ltd. is currently reviewing the Price Cap
Mechanism proposed by the Fair Trading Commission (FTC) for the
incumbent fixed line operator, reports Business News Americas.

The said plan limits annual hikes for regulated consumer
services to 7%.

"The decision has referred to compliance rules which have not
yet been distributed and these will be important to assist us in
concluding our review," C&W said in a brief statement.

Meanwhile, Mr. Roosevelt King, secretary general of the Barbados
Association of Non Governmental Organizations (BANGO), one of
the intervenors in the public hearings on C&W's original
application for a rate hike, said the annual increase amounted
to about $2 per year for subscribers.

"While I agree that the 7% is an upper limit, who is to say that
the company will not use the entire percentage, and $2 per year
over the next three years means that by August 2007, we will be
paying $35.30 and $37 by 2008, plus VAT."

(The current basic monthly rate is $28, which by King's
reckonings, would move to $29.96 this year; $32.06 next year;
$35.30 in 2007; and $37.77 in 2008 plus VAT).

To see summary of the Price Cap Plan:
http://bankrupt.com/misc/commission_decision_price_cap.pdf



=============
B O L I V I A
=============

BANCO UNION: Moody's Withdraws Ratings
--------------------------------------
Moody's Investors Service has withdrawn all of its ratings for
Banco Union S.A. (Bolivia) for business reasons.

The bank has no rated foreign or local currency debt
outstanding.

The following ratings were withdrawn:

- Long Term Foreign Currency Deposits: Caa2
- Short Term Foreign Currency Deposits: Not Prime
- Long Term Local Currency Deposits: Caa2
- Short Term Local Currency Deposits: Not Prime
- Bank Financial Strength: E
- National Scale Rating: Baa3.bo

Banco Union S.A. (Bolivia) is a private bank based in Santa
Cruz, Bolivia. As of 12/31/04, Banco Union S.A. was the sixth
bank in terms of deposits, with $ 223 MM and 8.2% of market
share. In 2004, NAFIBO SAM, the government's development bank,
became the majority shareholder with an 83% controlling stake.

New York
M. Celina Vansetti
Senior Vice President
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Buenos Aires
Maria Andrea Manavella
Vice President - Senior Analyst
Financial Institutions Group



=========
C H I L E
=========

ENAP: Failed Columbian Oil Exploration Bids Lead to Loss
--------------------------------------------------------
Chile's national oil company ENAP lost an estimated US$16.5
million last year because of failed oil exploration bids in
Colombia. Mercopress reported Friday that Sipetrol, its
international affiliate handling overseas operations, suffered
the losses after five of the seven oil exploration concessions
awarded by the Colombian government closed down.

The report says that five of these tranches did not have oil
reserves sufficient for commercial exploitation. Further, the
remaining two concession areas did not attract investors to fund
development. Sipetrol's operations in Argentina and Ecuador
however remain profitable.

ENAPS' foreign oil concessions are an integral part of Chile's
reserves. International oil wells allow Chile to achieve 25
percent oil self-sufficiency. Domestic production accounts for 5
percent of this amount.

Chile continues to scout for means to improve its oil reserves.
The government is initiating talks with Peru to explore the
possibility of building an oil pipeline from the Camisea project
to Chile.



===================================
D O M I N I C A N   R E P U B L I C
===================================

BANCO BHD: Fitch Affirms Ratings
--------------------------------
Fitch Ratings affirmed Dominican Republic bank Banco BHD's
ratings as set forth below. The Rating Outlook is Stable.

--Long-term foreign currency at 'CCC+';
--Short-term foreign currency at 'C';
--Individual at 'D';
--Support at '5'.

The action follows the downgrade of the Dominican Republic's
long-term foreign currency rating to 'C' from 'CCC+', stemming
from the announcement of a distressed sovereign debt exchange on
USD 1.1 billion in bonds due 2006 and 2013. The rationale for
the affirmation of the bank's ratings stems on the fact that it
does not currently hold debt that is due to be exchanged in the
aforementioned transaction and therefore it should not have a
significant impact on the institution. Also, given that the
liquidity position of the Dominican Republic is likely to
improve following the debt exchange, the bank's prospects are
also likely to improve in the medium to longer term.

Furthermore, the rated bank's financial profile, while still
relatively weak, has improved considerably in the past few
months, which places it in a better position to benefit from the
economic recovery in the Dominican Republic, when and if this
takes place.

CONTACT:  Carlos Fiorillo, +58 212 286 3356, Caracas
          Franklin Santarelli +58 212 286 3356, Caracas
          Gustavo Lopez +1-212-908-0853, New York

MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York


BANCO DOMINICANO: Ratings Affirmed After DR Ratings Change
----------------------------------------------------------
Fitch Ratings affirmed Dominican Republic bank Banco Dominicano
del Progreso's ratings as set forth below. The Rating Outlook is
Stable.

--Long-term foreign currency at 'CCC+';
--Short-term foreign currency at 'C';
--Individual at 'D/E';
--Support at '5'.

The action follows the downgrade of the Dominican Republic's
long-term foreign currency rating to 'C' from 'CCC+', stemming
from the announcement of a distressed sovereign debt exchange on
USD 1.1 billion in bonds due 2006 and 2013. The rationale for
the affirmation of the bank's ratings stems on the fact that it
does not currently hold debt that is due to be exchanged in the
aforementioned transaction and therefore it should not have a
significant impact on the institution. Also, given that the
liquidity position of the Dominican Republic is likely to
improve following the debt exchange, the bank's prospects are
also likely to improve in the medium to longer term.

Furthermore, the rated bank's financial profile, while still
relatively weak, has improved considerably in the past few
months, which places it in a better position to benefit from the
economic recovery in the Dominican Republic, when and if this
takes place.

CONTACT:  Carlos Fiorillo, +58 212 286 3356, Caracas
          Franklin Santarelli +58 212 286 3356, Caracas
          Gustavo Lopez +1-212-908-0853, New York

MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York


BANCO LEON: Fitch Affirms Long-term, Short-term FC Ratings
----------------------------------------------------------
Fitch Ratings affirmed Dominican Republic bank Banco Leon's
ratings as set forth below. The Rating Outlook is Stable.

--Long-term foreign currency at 'CCC+';
--Short-term foreign currency at 'C';
--Individual at 'E';
--Support at '5'.

The action follows the downgrade of the Dominican Republic's
long-term foreign currency rating to 'C' from 'CCC+', stemming
from the announcement of a distressed sovereign debt exchange on
USD 1.1 billion in bonds due 2006 and 2013. The rationale for
the affirmation of the bank's ratings stems on the fact that it
does not currently hold debt that is due to be exchanged in the
aforementioned transaction and therefore it should not have a
significant impact on the institution. Also, given that the
liquidity position of the Dominican Republic is likely to
improve following the debt exchange, the bank's prospects are
also likely to improve in the medium to longer term.

Furthermore, the rated bank's financial profile, while still
relatively weak, has improved considerably in the past few
months, which places it in a better position to benefit from the
economic recovery in the Dominican Republic, when and if this
takes place.

CONTACT:  Carlos Fiorillo, +58 212 286 3356, Caracas
          Franklin Santarelli +58 212 286 3356, Caracas
          Gustavo Lopez +1-212-908-0853, New York

MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York


BANCO MERCANTIL: Fitch Affirms Ratings
--------------------------------------
Fitch Ratings affirmed Dominican Republic bank Banco Mercantil's
ratings as set forth below. The Rating Outlook is Stable.

--Long-term foreign currency at 'CCC';
--Short-term foreign currency at 'C';
--Individual at 'E';
--Support at '5'.

The action follows the downgrade of the Dominican Republic's
long-term foreign currency rating to 'C' from 'CCC+', stemming
from the announcement of a distressed sovereign debt exchange on
USD 1.1 billion in bonds due 2006 and 2013. The rationale for
the affirmation of the bank's ratings stems on the fact that it
does not currently hold debt that is due to be exchanged in the
aforementioned transaction and therefore it should not have a
significant impact on the institution. Also, given that the
liquidity position of the Dominican Republic is likely to
improve following the debt exchange, the bank's prospects are
also likely to improve in the medium to longer term.

Furthermore, the rated bank's financial profile, while still
relatively weak, has improved considerably in the past few
months, which places it in a better position to benefit from the
economic recovery in the Dominican Republic, when and if this
takes place.

CONTACT:  Carlos Fiorillo, +58 212 286 3356, Caracas
          Franklin Santarelli +58 212 286 3356, Caracas
          Gustavo Lopez +1-212-908-0853, New York

MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York


* DOMINICAN REPUBLIC: Fitch Lowers FC Sovereign Rating to 'C'
-------------------------------------------------------------
Upon announcement of an exchange for the Dominican Republic's
bonds due 2006 and 2013, Fitch Ratings has downgraded that
country's foreign currency issuer rating as well as the ratings
on the debt eligible for the exchange to 'C' from 'CCC+', with a
Negative Rating Watch.

The aggregate principal amount of the bonds eligible for the
exchange is US$1.1 billion. The exchange for new bonds with the
same coupon but a longer maturity implies a distressed debt
exchange, as do exit amendments to the eligible bonds that
weaken their credit quality. Finally, the bond exchange is part
of a broader restructuring of the government's external debt
profile under the auspices of an IMF program that is necessary
to avoid a disorderly default. Upon completion of the exchange,
scheduled for May 4, Fitch will place eligible bonds, as well as
the Dominican Republic's foreign currency issuer rating, in a
default category. The long-term local currency rating remains at
'CCC+', as local currency obligations are not included in the
exchange. The short-term foreign currency rating also remains at
'C'.

The government of the Dominican Republic announced Wednesday
that it will exchange its foreign-currency-denominated bonds due
in 2006 and 2013 for new bonds with maturities of five years
longer. Although the 9.50% bonds due 2006 and the 9.04% bonds
due 2013 will amortize on a semi-annual basis during the five-
year extension period, the exchange imposes a loss for all
bondholders in present value terms, all else being equal.
Additionally, bondholders that elect not to participate in the
exchange will face unfavorable exit amendments including the
elimination of event of default provisions triggered by cross-
default, cross-acceleration, and/or unsatisfied or discharged
judgments on their existing bonds, as well as the deletion of
the negative pledge covenant in the existing bonds. The
Dominican Republic may also seek to de-list the existing bonds
from the Luxembourg Stock Exchange. These changes to the
original contract would appear to be permissible under existing
bond contracts, given support from the majority of holders
tendering bonds for the exchange, but would nonetheless be
harmful to 'holdout' investors.

Furthermore, settlement of the exchange may be conditioned on a
minimum participation rate of at least 85% in aggregate
principal amount of all existing bonds. Finally, the government
has stated that if the exchange fails, the Dominican Republic
may not be able to continue to service its debt obligations,
even during 2005, underscoring the government's financial
distress.

Upon completion of the exchange, Fitch would lower the ratings
on eligible bonds to a default category. In accordance with
Fitch's practice in distressed debt exchanges, existing bonds
would retain a default rating for at least 30 days. After 30
days, if the government is committed to continuing to pay
principal and interest on any outstanding defaulted bonds
according to their original terms, the ratings on these
securities would be raised to a non-default rating to the extent
that they are not fully extinguished through tenders. New
securities issued as part of the exchange would be assigned a
non-default rating based on Fitch's assessment of the likelihood
of timely and complete payment, potentially in the 'B' category,
assuming that the new debt service burden resulting from the
exchange is manageable in the context of a credible fiscal
program, IMF financing assurances, and the continuation of debt
relief agreed with the Paris Club and that other negative
developments do not obtain. A comparatively orderly exchange
undertaken with the support of the IMF and official bilateral
creditors, while at the same time remaining current on its
obligations to bondholders, signals the Dominican authorities'
commitment to make best efforts to normalize relations with
creditors, and also supports a post-exchange sovereign rating in
the 'B' category. A final determination of the appropriate
rating for the new bonds would be made when they are issued. If
the government resumes payment on bonds eligible for tender and
not fully extinguished, these bonds would likely be rated below
the new issues on the expectation that the government would make
a distinction in its willingness to pay new bonds before
exchange-eligible bonds.

If the exchange is successful, the Dominican Republic's
liquidity position could improve considerably. Scheduled
amortizations through 2013 would be due to almost entirely
official creditors. Assuming a 90% participation rate, most of
the savings in 2005 would come from Paris Club debt relief
(US$142 million) and the 100% capitalization of the remaining
interest payments on the new bonds (US$46 million), as market
amortizations, which amount to US$20 million, would remain
unchanged as a result of the exchange. In 2006, the most
significant savings would come from the five-year extension of
the US$500 million maturity on the existing bonds. Total debt
service would be reduced, declining to an estimated 2.7% of GDP
in 2005 from 3.6% in 2004 (equivalent to 15.4% of revenues in
2005 from 22.2% of revenues in 2004). As the new bonds begin to
amortize in 2007, market amortizations would increase to US$130
million from US$20 million pre-exchange.

CONTACT: Theresa Paiz Fredel +1-212-908-0534, New York
         Morgan Harting +1-212-908-0820, New York

MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York


* DOMINICAN REPUBLIC: IMF to Support Economic Strategy
------------------------------------------------------
Mr. Rodrigo de Rato, Managing Director of the International
Monetary Fund (IMF), addressed the following letter about the
Dominican Republic to Members of the Financial Community on
April 20, 2005:

"The economic program of the Dominican Republic for 2005-06
seeks to re-establish macroeconomic and financial stability,
while creating conditions for sustainable growth over the medium
term. Key elements of the program include a substantial fiscal
adjustment and structural reform measures to address the wide
range of institutional changes and governance issues in the
public sector and financial system. The economic program is
being supported by a 28-month Stand-By Arrangement, approved by
the IMF's Executive Board on February 1, 2005, as well as
assistance from the World Bank, the Inter-American Development
Bank, and bilateral creditors, in particular Paris Club members.

"The authorities have announced a bond exchange offer that aims
to help solve the country's short-term liquidity problem in a
manner consistent with medium-term debt sustainability.
Discussions are also well advanced on rescheduling external
private bank loans and suppliers credits to the Dominican
Republic. A successful bond exchange and rescheduling of debts
to external banks and suppliers will depend on high
participation rates to secure financing assurances for the Fund-
supported program. Successful completion of these private debt
restructurings is also necessary to fulfill the country's
commitment to seek comparable treatment from private creditors
in line with the requirements of the Paris Club's 2004
rescheduling, as well as a precondition for additional Paris
Club debt relief in 2005-06.

"The authorities of the Dominican Republic are aware of the
challenges ahead and have reaffirmed their determination to
address remaining macro-economic imbalances and deepen
structural reforms to restore financial stability and put the
economy on a path of sustained and high growth. In addition to
continued support from international financial institutions and
other official creditors, the success of the authorities'
program will depend on the participation of the Dominican
Republic's private creditors," Mr. de Rato said.



=============
E C U A D O R
=============

* ECUADOR: 'B-' LT Rating Placed On CreditWatch Negative
--------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B-' long-term
sovereign credit rating on the Republic of Ecuador on
CreditWatch with negative implications.

Uncertainty about short- and medium-term economic management, in
the context of a highly volatile social and political
environment, has introduced increased risk as to the timely
repayment of forthcoming principal and interest obligations.

The unfolding of political events in Ecuador, culminating with
Wednesday's ousting of former President Lucio Gutierrez,
underscore Standard & Poor's assessment that Ecuador has one of
the weakest and most unpredictable political and institutional
environments among its 107 rated sovereigns. The backing for the
new president, former Vice President Alfredo Palacio, is
precarious and the possibility of future changes in government
cannot be ruled out-which is in and of itself problematic given
the absence of a credible replacement.

"The uncertainties surrounding governance and the direction of
fiscal policy introduce substantial risk," said Standard &
Poor's credit analyst Lisa Schineller. "This risk exists despite
a high oil price environment and a projected US$700 million
accruing to the oil stabilization fund (FEIREP) in 2005 that
provides a cushion to meet the central government's financing
needs," she added.

Ms. Schineller explained that, in light of the apparent
departures of senior officials at the Ministry of Finance, the
most immediate risk includes the technical and administrative
capabilities of the ministry to service both the 2012 coupon
payment of US$75 million (due on May 15, 2005) as well as short-
dated locally issued debt. A reduced appetite for locally issued
government paper, which rolls over monthly, is anticipated.

"Various other risk and developments could arise," noted Ms.
Schineller.

"These include the stability of deposits in the banking system
amid the political volatility, especially given the absence of a
lender-of-last-resort under dollarization, which will serve as a
leading indicator of the impact of the crisis on economic
stability. Another possible risk is any disruption to oil
exports, production, or pipeline capacity, which would impair
financing and the fiscal accounts," she said.

The likely fiscal stance of the government-be it led by
President Palacio or someone else-requires monitoring because
spending pressures are expected to increase, given the political
and social climate. "Notwithstanding past rhetoric by President
Palacio for a looser fiscal stance and changes to the use of
revenue accruing to the FEIREP, how 'aggressive' that stance
might be given the financing constraints of dollarization and
realities of governance is not yet clear," Ms. Schineller said.
"President Gutierrez was more fiscally prudent than Standard &
Poor's initially assumed. Policy articulation from the new
president and still-to-be determined finance minister will be
important developments," she concluded.

Standard & Poor's said that Ecuador's 'B-' ratings could be
downgraded should it become apparent that debt management
capabilities are clearly impaired and/or some of the risk
factors mentioned above deteriorate. The availability of
official funding over the next 12 months is another important
rating factor, as presumed access to official financing
bolstered funding from FEIREP and supports the 'B-' rating. The
rating could be removed from CreditWatch negative in the coming
months upon signs that Ecuador's political crisis is likely to
have a limited impact on the government's fiscal stance or
access to local and official funding.

CONTACT:  Primary Credit Analyst:
          Lisa M Schineller, New York
          Tel: (1) 212-438-7352
          E-mail: lisa_schineller@standardandpoors.com

          Secondary Credit Analyst:
          Joydeep Mukherji, New York
          Tel: (1) 212-438-7351
          E-mail: joydeep_mukherji@standardandpoors.com



=====================
E L   S A L V A D O R
=====================

BANCO AGRICOLA: S&P Details Rasoning for Ratings
------------------------------------------------
Rationale

The ratings on Banco Agricola S.A. (BB/Stable/B) are constrained
by the bank's vulnerable asset quality due to its relatively
flexible policy toward loan restructuring and a nonconservative
reserve policy on nonperforming assets (NPAs), which is a
weakness of the Salvadorian banking system as a whole. The
ratings are also constrained by the relatively small size and
limited diversification of El Salvador's economy. The ratings
are supported by Banco Agricola's leading market position in El
Salvador, particularly in attracting retail deposits, which
contributes to good liquidity. Other positive factors considered
in the ratings are the adequate management of the bank, which
has been able to maintain profitability levels despite the
challenging economic environment during the past two years, and
better efficiency than that of its peers.

Although Banco Agricola's loan book shows more diversity than
that of its peers, structural factors that raise credit risk
remain, such as NPAs (including nonperforming loans,
restructured loans, and repossessed assets) of 12.5% at December
2004. The small size and diversification of El Salvador's
economy along with slow economic growth constrain future loan
growth. Despite a high level of NPAs, the bank has strengthened
its credit underwriting policy to contain loan losses and is
dealing more dynamically with repossessed assets. Excluding
another extraordinary restructuring such as Ficafe, Banco
Agricola is expected to slowly improve its asset quality in the
future due to tightened underwriting policies and improved
collection.

Banco Agricola remains El Salvador's largest bank, with $3.2
billion in assets and a market share of 30% in deposits as of
December 2004. The bank has always focused on the mass market
and wants to consolidate local leadership by emphasizing retail
deposits and cross-selling other products. Its current focus is
to be the leader in consumer banking and to be the most
efficient bank in El Salvador. To achieve both, a reengineering
has taken place mainly in consumer banking, and cost-cutting
actions taken in 2004 have already benefited Banco Agricola's
efficiency, which improved to 49% in December 2004 from 56% in
2003 despite the stability of operating revenues.

Banco Agricola has improved its main profitability ratios in the
past three years and is one of the most profitable banks in El
Salvador. This success is explained mainly by the implementation
of a cost reduction program and a drop in its cost of funds.
Future profitability will be strongly influenced by competition
in the market, as most competitors are focusing their strategies
on lowering prices and targeting consumer and personal loans.
Despite an aggressive dividend payout ratio of 50%, current
capitalization and internal capital generation could be enough
to finance the bank's future needs, as loan growth is not
expected to be high.

Outlook

The stable outlook reflects Standard & Poor's Ratings Services
opinion that the bank's strategies and adequate operations
should maintain profitability at adequate levels in a stable
economic environment. Loan diversification is expected to
continue going forward, as the bank is focusing its new loans
mainly on consumer and personal lines. An economic downturn or
the continuation of low growth prospects for the Salvadorian
economy could affect the bank's overall performance and thus
pressure the ratings. On the other hand, the ratings could be
raised if there is a larger-than-expected development in
economic conditions, along with a sustainable improvement in
asset quality (including restructured loans and repossessed
assets) and profitability, and if capital ratios remain higher
than those of its closest peers.

CONTACT:  Primary Credit Analyst:
          Leonardo Bravo, Mexico City
          Tel: (52)55-5081-4406
          E-mail: leonardo_bravo@standardandpoors.com

          Secondary Credit Analyst:
          Angelica Bala, Mexico City
          Tel: (52) 55-5081-4405
          E-mail: angelica_bala@standardandpoors.com


BANCO CUSCATLAN: S&P Releases Report on Ratings
-----------------------------------------------
Rationale

The ratings on Banco Cuscatlan S.A. (BB/Stable/B) are
constrained by the bank's vulnerable asset quality due a high
level of restructured and foreclosed assets and a
nonconservative reserve policy of nonperforming assets (NPAs),
which is a weakness of the Salvadorian banking system as a
whole. The ratings are also constrained by the relatively small
size and limited diversification of El Salvador's economy. The
ratings are supported by the bank's strong market position in El
Salvador, its adequate profitability, and the increasing
recognition of the Cuscatlan brand in the Central American
region.

Although asset quality has shown improvements, as the NPAs
decreased to 10% in 2004 from 13.9% in 2004 of total loans, the
level remains high compared to that of other banks in Latin
America. Restructured loans, including Ficafe loans and
repossessed assets, represent more than 80% of total NPAs. In
addition to a high level of NPAs, loan loss reserve coverage is
only 28%. To improve asset quality going forward, the bank has
tightened credit underwriting conditions, enhanced borrower
surveillance, and taken a slightly more conservative approach
toward loan restructurings. The bank is expected to slowly
improve asset quality in the future, although the economic
environment would post additional challenges.

Cuscatlan has maintained one of the highest profitability ratios
in the El Salvador market, with 1% ROA; however, profitability
levels remain low compared to those of other players in the
region. To compensate for the slow growth in NIM derived from
loan portfolio stability and low intermediation margins, the
bank has increased trading activities, which although a volatile
source of earnings, remain at adequate levels for the current
rating level. Margins have compressed in the system as a whole
as a consequence of high competition, important liquidity
levels, and the dollarization policy implemented in the country.
Margin compression is expected to be handled with increases in
the lending rates, increasing fees and commissions, and
efficiency improvements. As loan growth is anticipated to be
moderate, it is likely that trading income will maintain its
importance in the future. As 2005 is not expected to be a
dynamic business environment, profitability should remain at the
current levels.

Banco Cuscatlan has maintained its market position as the
second-largest bank in El Salvador, holding 24% of the system's
deposits. Growth has been slow in El Salvador, though, and this
has resulted in lower-than-usual growth rates for the bank.
Banco Cuscatlan is trying to sustain prices by diversifying
sources of revenues and increasing products. Like other players
in the system, Cuscatlan is placing great emphasis on greater
growth in the retail segment, which should offset downward
pressure on margins. As of December 2004, Banco Cuscatlan
exhibited 9.37% adjusted common equity to asset ratio that
compares well with the 7.94% held in 2003 and is more in line
with the capital ratios of its main peers. Internal capital
generation should finance future needs, as loan growth is not
expected to be high.

Outlook

The outlook reflects our opinion that the bank's strategies and
adequate operations should maintain profitability at good levels
in a stable economic environment. However, an economic downturn
or the continuation of low growth prospects for the Salvadorian
economy could affect the bank's overall performance, putting
pressure on the ratings. The ratings could go up if there is a
strong development in economic conditions, along with a
sustainable improvement in asset quality (including restructured
loans and repossessed assets) and profitability, and if capital
ratios are higher than those of its closest peers.

CONTACT:  Primary Credit Analyst:
          Leonardo Bravo, Mexico City
          Tel: (52)55-5081-4406
          E-mail: leonardo_bravo@standardandpoors.com

          Secondary Credit Analyst:
          Angelica Bala, Mexico City
          Tel: (52) 55-5081-4405
          E-mail: angelica_bala@standardandpoors.com


MILLICOM INTERNATIONAL: Posts US$11.3M Loss for 1Q05
----------------------------------------------------
HIGHLIGHTS

- 26% increase in Revenues for Q1 05 to $268.9m (Q1 04:
$213.1m)*
- 19% increase in EBITDA for Q1 05 to $126.5m (Q1 04: $106.6m)*
- (Loss) / Profit for Q1 05 of $(11.3)m (Q1 04: $14.6m) (iv)
- Basic (Loss) / Earnings per common share for Q1 05 of $(0.11)
(Q1 04: $0.22) (iv)
- Quarterly total subscriber increase for Q1 05 of 828,394 (i)

Millicom International Cellular S.A. (Nasdaq Stock Market: MICC,
Stockholmsborsen and Luxembourg Stock Exchange: MIC), the global
telecommunications investor, announced Thursday results for the
quarter ended March 31, 2005.

Marc Beuls, Millicom's President and Chief Executive Officer
stated:

"Millicom has started the year strongly with good subscriber
growth reflecting both increased investment, particularly in new
GSM networks in 2004, and growing demand in its key markets.
Millicom has some 8.5 million subscribers and with penetration
rates taking off in Asia and Africa, the prospects are
excellent. Excluding Q3 03 when we reconsolidated the El
Salvador numbers, Q1 05 set a new proportional subscriber intake
record.

"Paktel is approaching 400,000 subscribers on its GSM network
and is on track to meet its target of adding one million
subscribers in the first year since the launch of GSM services.
Pakcom agreed payment terms for its license similar to Paktel's
on 18th April 2005 and this business will start to grow again
with the conversion to CDMA infrastructure in Q4 05. The heavy
investment in sales and marketing in Pakistan has affected South
Asia and group margins in the last two quarters and it will take
until 2007 before this region again attains average group
margins.

"Africa remains the fastest growing market showing growth in
total subscribers of 70% over the first quarter of 2004 and is
today the third largest region in terms of revenues after
Central America and South East Asia. There will continue to be
opportunities to expand into new territories in Africa, the
latest being Millicom's license in Chad which is expected to be
operational in 2005.

"In Vietnam the negotiations on the continuation of the
cooperation have not yet led to an agreement between the
parties. The negotiations on the creation of a Joint Stock
Company, as agreed between the parties by signing the MOU last
November, are continuing. The Government of Vietnam has agreed
to equitize VMS, our partner under the current BCC. This is the
first equitization of a major telecommunication company in
Vietnam which explains why at present, no information is
available as to the process of this equitization. For Millicom's
subsidiary Comvik International Vietnam "CIV" to form a joint
venture with VMS changes in legislation will be needed in the
future. It is unlikely that this process will have started by
the end of the BCC on May 18th and without agreement between the
parties at that date, Millicom will no longer be able to
consolidate the Vietnam numbers. Millicom will communicate on
progress during the second quarter.

"Millicom is today well funded, with cash reserves of over half
a billion dollars and generating free cash. These resources will
allow the company to exploit the multiple opportunities that are
currently available in its markets."

FINANCIAL AND OPERATING SUMMARY*

Subscriber growth:

- An annual increase in total cellular subscribers of 45% to
8,541,595 as at March 31, 2005.

- An annual increase in proportional cellular subscribers of 44%
to 5,960,090 as at March 31, 2005. In the first quarter of 2005
Millicom added 828,394 net new total cellular subscribers.

- Proportional prepaid subscribers increased to 5,371,690 from
3,641,976 as at March 31, 2004.

Financial highlights:

- Revenues for the first quarter of 2005 were $268.9 million, an
increase of 26% from the first quarter of 2004. Compared to the
fourth quarter of 2004, revenues increased by 5% from $255.7
million.

- EBITDA increased by 19% in the first quarter of 2005 to $126.5
million, from $106.6 million for the first quarter of 2004.

Loss for the first quarter of 2005 was $11.3 million, compared
to a profit of $14.6 million for the first quarter of 2004.

Net debt excluding the 5% mandatory exchangeable notes amounts
to $209.6 million.

Cash and cash equivalents as of March 31, 2005 amounted to
$670.0 million mainly due to the settlement in January 2005 of
the 4% convertible bonds raised in December 2004 with net
proceeds of $196 million and further cash upstream from
operations.

- Total cellular minutes increased by 40% for the three months
ended March 31, 2005 from the same quarter in 2004. Prepaid
minutes increased by 47% in the same period.

- On March 30, 2005, the license in Honduras was renewed until
2021, following approval by Congress.

- On April 18, 2005, Millicom's subsidiary Pakcom reached an
agreement with the Pakistan Telecommunications Authority (PTA)
for the renewal of its license for 15 years. The payment terms
are similar to the terms agreed in 2004 by Paktel, Millicom's
other subsidiary in Pakistan. Pakcom will pay a license fee of
$291 million, with 50% payable over three years and the
remaining 50% payable over the following ten years. The first
down payment for the license was made on April 18, 2005. Pakcom
is still in negotiations with the PTA with regard to the
allocation of spectrum.

REVIEW OF OPERATIONS

SUBSCRIBER GROWTH

In the first quarter of 2005 Millicom's worldwide operations
added 828,394 net new total cellular subscribers. On a
proportional basis, Millicom added 627,831 subscribers, bringing
the number of proportional cellular subscribers as at March 31,
2005 to 5,960,090.

At March 31, 2005, Millicom's total cellular subscriber base
increased by 45% to 8,541,595 cellular subscribers from
5,897,371 as at March 31, 2004. Particularly significant
percentage increases were recorded in Ghana (124%), Laos (116%),
Paktel (91%) and Tanzania (71%). Millicom's proportional
subscriber base increased to 5,960,090 as at March 31, 2005 from
4,128,030 as at March 31 2004, an increase of 44%.

Within the 5,960,090 proportional cellular subscribers reported
at the end of the first quarter, 5,371,690 were prepaid
subscribers. Prepaid subscribers currently represent 88% of
total and 90% of proportional cellular subscribers.

FINANCIAL RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2005*

Total revenues for the three months ended March 31, 2005 were
$268.9 million, an increase of 26% from the first quarter of
2004 and of 5% from the previous quarter, reflecting the
increasing trend of growth in Millicom's operations. Millicom
recorded revenue growth in Africa of 51% to $48.0 million in the
first quarter of 2005 compared with the same period in 2004,
with Senegal producing growth of 67%. First quarter revenues for
South East Asia were $70.3 million compared to $55.7 million in
the first quarter of 2004, an increase of 26% and for South
Asia, revenues were $29.7 million, a 3% decrease from the first
quarter of 2004, but a 19 % increase from the previous quarter
when revenues were depressed following the delay in the launch
of the GSM services.

The Central American market continued to perform strongly,
producing a 29% increase in revenues from $68.8 million for the
first quarter of 2004 to $88.6 million for the first quarter of
2005. In South America, revenue growth at 25% has improved
significantly and Paraguay and Bolivia produced revenue
increases of 27% and 22% respectively compared to the first
quarter of 2004.

EBITDA for the three months ended March 31, 2005 was $126.5
million, an increase of 19% from the quarter ended March 31,
2004. EBITDA for Africa increased by 59% to $21.2 million in the
first quarter of 2005 from $13.3 million in the first quarter of
2004. EBITDA for South East Asia was $43.5 million for the first
quarter, an increase of 32% from the same period in 2004 and
South Asia saw a decline in EBITDA in the first quarter of 2005
to $5.0 million, due to increased sales and marketing costs
relating to the GSM services in Pakistan. Central America
recorded growth in EBITDA of 31% from the first quarter of 2004
to $44.3 million and the equivalent increase for South America
was 27% giving EBITDA of $12.4 million. The quarterly EBITDA
margin for South East Asia was 62% and for South Asia was 17%.
Central America recorded an EBITDA margin of 50% and for South
America it was 40%. The EBITDA margin for Africa was 44%.

COMMENTS ON FINANCIAL STATEMENTS

The depreciation and amortization charge for the first quarter
of 2005 included $19.0 million in relation to Vietnam. Write-
down of assets include an impairment charge of $16.6 million on
the property, plant and equipment in Vietnam as the Business
Cooperation Contract in Vietnam expires on May 18, 2005 and an
impairment charge on the Pakcom analog equipment of $5.2
million.

The Vietnam asset impairment is due to a late approval of
investments required under the BCC preventing CIV from
generating revenues on these fixed assets.

The interest expense for the first quarter of 2005 comprised
prepaid interest and amortization of deferred financing fees on
the 5% Notes of $6.6 million, interest and amortization of
deferred financing fees on the 10% Notes of $14.7 million and on
the 4% convertible bonds of $3.5 million, interest expenses of
$3.3 million computed on the Paktel license payable and interest
expenses on other debt and financing of $5.2 million.

For the first quarter of 2005, the conversion to US dollars of
the 5% mandatory exchangeable Notes in Tele2 shares (the "5%
Notes") resulted in an exchange gain of $21.4 million and the
embedded derivative on the 5% Notes resulted in a fair value
gain of $26.2 million. These gains were offset by a loss
resulting from the valuation movement on the Tele2 shares of
$55.5 million. This resulted in a net loss of $7.9 million for
the quarter.

The 4% convertible bonds are convertible at the option of
holders at any time up to December 29, 2009, unless previously
redeemed, converted or purchased and cancelled, into Millicom
common stock at a conversion price of $34.86 per share. Millicom
has apportioned part of the value of these notes to equity and
part to debt. The value allocated to equity as of March 31, 2005
was $39.1 million and the value allocated to debt was $158.1
million.

The unpaid portion of the licenses is recorded under the
captions `other non-current liabilities' and `other current
liabilities'. As of March 31, 2005, the Paktel license results
in a non-current liability of $178.8 million and a current
liability of $28.7 million. The license in Ghana results in a
non-current liability of $12.0 million and a current liability
of $4.0 million.

About Millicom International

Millicom International Cellular S.A. is a global
telecommunications investor with cellular operations in Asia,
Latin America and Africa. It currently has a total of 17
cellular operations and licenses in 16 countries. The Group's
cellular operations have a combined population under license of
approximately 399 million people.

To view financial statements:
http://bankrupt.com/misc/millicom.pdf

CONTACT: Mr. Marc Beuls
         President and Chief Executive Officer
         Millicom International Cellular S.A., Luxembourg
         Telephone: +352 27 759 327

         Mr. Andrew Best
         Investor Relations
         Shared Value Ltd, London
         Telephone: +44 20 7321 5022
         Web site: http://www.millicom.com



=============
J A M A I C A
=============

NCB JAMAICA: S&P Releases Analysis on Ratings
---------------------------------------------
Rationale

The ratings (FC: B/Stable/B - LC: B/Stable/B) on Commercial Bank
Jamaica Ltd. (NCB) are constrained by the sovereign ratings on
Jamaica, as sovereign bonds and loans to public entities
represent most of NCB's assets. The ratings are also constrained
by NCB's larger-than-peer loan concentration in its main clients
and its operation in a relatively small, highly indebted, and
nondiversified economy. The ratings are supported by the bank's
relevant market presence in the Jamaican banking system and
improving operating performance since the bank's privatization
in 2002.

NCB maintains a large exposure to Jamaica's government,
represented by investments in government bonds. In addition, an
important portion of the loan portfolio is concentrated in
Jamaican public-sector companies in which the government is the
ultimate payer. Concentration in NCB's loan portfolio is higher
than that observed in other Central American and Caribbean banks
because the loan portfolio is relatively small, there is a
reduced number of clients, and loans are larger than those of
other institutions. Although NCB is increasing its consumer
loans to improve margins and to diversify its loan portfolio,
its main business is commercial lending and it would take time
to decrease concentrations and change the business mix.

NCB is one of the leading institutions in Jamaica, holding
approximately a 35% market share in terms of assets. The bank
benefits from strong brand-name recognition, maintains an
important presence in retail banking, and holds a leading
position in the island's credit card business. The bank
benefited in 2004 from the positive environment of a stable
foreign-exchange market, lower rates than in 2003, and improved
economic conditions. In addition, it has strengthened its credit
risk underwriting by centralizing and focusing processes,
updating credit limits, and strengthening credit approval
processes for consumer loans.

While growth in the loan portfolio remains on a positive trend,
loans still represent a small 21% of total assets. The
delinquency ratio of 3.9% at December 2004 is lower than the 5%
reported in 2003 and 9% in 2002. On the same positive trend,
reserve coverage was maintained at an adequate 1.5x the balance
of nonperforming assets. As credit underwriting has
strengthened, it is expected that asset quality will remain at
current levels, barring any major event in Jamaica's economy.
Improvements in NCB's financial profile have been achieved
thanks to loan growth, higher participation of consumer loans,
and improving asset quality. Standard & Poor's Ratings Services
expects that NCB can maintain adequate profitability ratios as a
consequence of its important market share, increasing focus on
growing the loan portfolio, and its consumer loan portfolio.
Nevertheless, the bank's cost-to-income ratio is still at a weak
67%, and although it has shown a positive trend in the past two
years, it will pose a challenge to maintain as the bank follows
its expansion strategy. In our view, the bank maintains a high
regulatory capital ratio that allows loan growth, but given
expansion plans, capital ratios could be under pressure in the
future.

Outlook

The stable outlook mirrors the outlook on Jamaica's sovereign
credit ratings and reflects NCB's significant exposure to that
country, with most of the bank's assets represented by
government securities. NCB has improved its financial profile,
but it is challenged to further increase its loan portfolio,
maintaining adequate asset quality and reducing loan
concentration. The positive developments concerning
profitability are expected to continue; however, an improvement
in efficiency has to be implemented to maintain the trend.

CONTACT:  Primary Credit Analyst:
          Leonardo Bravo, Mexico City
          Tel: (52)55-5081-4406
          E-mail: leonardo_bravo@standardandpoors.com

          Secondary Credit Analyst:
          Jaime Carreno, Mexico City
          Tel: (52) 55-5081-4417
          E-mail: jaime_carreno@standardandpoors.com



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

AHMSA: Seeking Renewed Creditor Approval
-----------------------------------------
Steel company Altos Hornos de Mexico SA (AHMSA) plans to meet
with creditors in New York this month to present to them its new
debt proposal, reports Dow Jones Newswires. The Monclova-based
company has been in default on US$1.8 billion in debt since
April 1999 and has yet to resume payments after reneging on a
2001 restructuring deal in order to seek better terms.

Last year, the Company appointed the Vector brokerage to
represent it in debt talks.

Ahmsa, which mines its own iron and coal, said in a filing
Thursday with the Mexican Stock Exchange that it made operating
profit of MXN1.6 billion and net profit of MXN1.74 billion in
the first quarter on sales of MXN5.81 billion.

CONTACT: AHMSA
         International Operations
         Prolongacion Juarez s/n
         Monclova, Coah., 25770
         Phone: + 52 (866) 649 34 00
         Fax: + 52 (866) 649 23 10
         E-mail: sales@ahmsa.com
         Web site: http://www.ahmsa.com.mx


GRUPO DESC: Posts $24M Net Income in 1Q05
-----------------------------------------
HIGHLIGHTS

1Q05

- Sales and exports increased by 13.1% and 12.1%, respectively
versus 1Q04.
- Operating income increased by 25.6% compared to 1Q04.
- EBITDA reached US $46 million, an increase of 1.4% when
compared to 1Q04.
- Notably, Desc reported strong net income of US $24 million.
- Net debt decreased by US $58 million, 8.6% below 4Q04 and
37.2% below 1Q04.

FIRST QUARTER 2005

DESC, S.A. de C.V. (BMV: DESC) announced Thursday its results
for the first quarter of 2005 (1Q05).

SALES AND EXPORTS

1Q05 sales posted a 13.1% increase when compared to 1Q04 to US
$529 million. This increase was attributed to improved volumes
and prices. Total exports in 1Q05 reached US $247 million,
representing an increase of 12.1% when compared to 1Q04. This
result was mainly due to price increases in the exports of the
Chemical and Food Sectors.

OPERATING INCOME

Consolidated operating income in dollars for 1Q05 increased by
25.6% when compared to 1Q04 reaching US $22 million. The Company
continued applying strict controls on operating expenses, which
decreased from 15.3% of sales in 1Q04 to 14.4% in 1Q05, and
partially offset the increases in raw material prices.

EBITDA

EBITDA in 1Q05 was US $46 million, which represents an increase
of 1.4% when compared to 1Q04. This reflects the improved
results obtained mainly in the Chemical, Food and Real Estate
Sectors, which compensated the weaker results of the Automotive
Sector. In addition, it highlights the fact that Desc's results
have been stable since 1Q04 despite sharp increases in raw
material prices, predominantly steel, natural gas, butadiene and
styrene.

NET INCOME

Consolidated net income in dollars reached US $24 million in
1Q05, the third consecutive quarter of positive results. This
was due to the effect from the sale of the constant velocity
joint business.

DEBT

During 1Q05, Desc reported a US$ 58 million reduction in net
debt when compared to 4Q04, from US $678 million to US $620
million, representing an 8.6% decrease. This stemmed mainly from
the effect from the sale of the constant velocity joint
business.

At March 31, 2005, the total debt mix was 58% dollar-
denominated, 10% peso-denominated and 32% in UDIS. The debt
profile at the close of 1Q05 was 94% long-term and 6% short-
term. The average cost of debt as of the close of the quarter
was 5.77% for the dollar-denominated debt and 11.58% for the
peso-denominated debt, compared to 5.28% and 8.72%, respectively
in 1Q04.

The leverage ratio experienced a positive trend, going from
4.92x in 1Q04 to 3.23x in 1Q05, due mainly to the decrease in
debt and the improvements in EBITDA. The interest coverage ratio
also experienced improvements, increasing from 2.93x during 1Q04
to 3.72x in 1Q05.

RECENT EVENTS

DESC SEEKS TO ESTABLISH LOCAL BOND PROGRAM

On April 14, 2005, Desc announced its intentions to establish a
local bond program via the Mexican Stock Exchange with which it
may refinance its Medium Term Notes issued in 1999 and 2000.

RESULTS BY SECTOR

AUTOMOTIVE SECTOR

During 1Q05, sales increased slightly from US$179 million to US$
183 million, despite the Holy Week holiday and a 9.9% decrease
in domestic vehicle production, which mainly affected the Big
Three (General Motors, DaimlerChrysler and Ford).

Operating Income and EBITDA decreased significantly versus the
same period of the previous year due primarily to an increase in
steel costs in the range of 60-100%, depending on the type of
steel, which affected practically all the businesses. In
addition, changes in the income tax law forced sharp accumulated
inventory levels for our clients at the close of 2004 thereby
causing a decline in autopart sales in 1Q05.

A positive factor during the quarter was the decrease in
operating expenses due to strict internal controls and the
administrative restructuring.

CHEMICAL SECTOR

Sales for 1Q05 reached US$ 217 million, representing an increase
of 28% compared to sales for the same period of the previous
year. This was due to price increases in most of the businesses
due to higher raw material costs.

Operating income for 1Q05 was US$ 11 million, 286.7% higher than
the figure reported in 1Q04, mainly as a result of a better
operating margin, which increased from 1.7% to 5.2%. This
improvement in the operating margin was due to the price
increase, the better and more profitable product mix, improved
plant productivity and strict cost controls.

The price of the main raw materials, butadiene and styrene
monomers, increased by approximately 40% compared to 1Q04 as a
consequence of the volatility of oil prices, which reached
historical highs, as well as the low supply of butadiene
monomers. The combination of the previous factors resulted in an
improvement in EBITDA of 82% when compared to 1Q04.

FOOD SECTOR

During 1Q05, sales in the food sector increased 4.9% compared to
1Q04; operating income and operating cash flow increased 61.6%
and 34.6%, respectively, compared to the same period of the
previous year.

BRANDED PRODUCTS

During 1Q05, sales increased 1.0% compared to 1Q04, due to
higher sales in practically all product lines, most notably:
"Del Fuerte" brand tomato paste, which grew 7%, and "Nair" tuna
with an increase of 12%, as well as the success of "Smucker's"
preserves.

In ASF, the institutional channel, demand from restaurants
increased 16.3% with respect to the previous year, and in the
supermarket channel, demand grew 3.9% compared to the same
period of the previous year.

During 1Q05, the Company was able to increase prices across all
categories to levels which were above the expected inflation for
2005.

Operating income increased by 168.9% compared to 1Q04, mainly
due to price increases, improved productivity, cost optimization
due to an earlier tomato season and strict cost controls.

PORK BUSINESS

Pork prices continued to increase during 1Q05, growing 12.3%
compared to the same period of 2004. In addition, increased
efficiency resulted in an improved operating margin, increasing
from 11.5% in 1Q04 to 14.0% in 1Q05. Another positive effect was
improved export sales as a result of entering the Korean market.

REAL ESTATE SECTOR

1Q05 sales reached US$ 32 million, representing an increase of
20.1% compared to revenues for the same quarter of the previous
year, due to excellent sales acceptance at the Punta Mita
project and the sale of the "La Marina" lot located within the
same development.

The sales distribution for 1Q05 was as follows:

Punta Mita             89%
Bosques de Santa Fe     5%
Others                  6%

During the quarter, operating income reached US$ 6 million and
EBITDA reached US$7 million, registering an increase of 66.6%
and 67.0%, respectively when compared to 1Q04 due to the sales
increase and a better mix.

Investment in projects during 1Q05 was US$ 5.8 million mainly
for infrastructure at the Punta Mita and Bosques de Santa Fe
projects, the latter of which is near completion, both in terms
of infrastructure and urbanization.

(Except as noted , all figures were prepared according to
generally-accepted accounting principles in Mexico (Mexican
GAAP). Unless otherwise noted, the results in this report are
being compared to adjusted 1Q04 accumulated figures, which are
pro forma since they exclude Desc's constant velocity joint
business to make them more comparable with the 1Q05 results.
Management believes that investors can better evaluate and
analyze Desc's historical and future business trends on a
comparative basis if they consider results of operations without
these divested businesses. In addition, 1Q04 results are stated
at the peso-dollar exchange rate at March 31, 2005, as well as
in U.S. dollars.)

To view financial statements:
http://bankrupt.com/misc/GrupoDesc1Q05.pdf

CONTACT: Ms. Marisol Vazquez-Mellado
         Mr. Jorge Padilla
         Phone: (5255) 5261 8044
         E-mail: investor.relation@desc.com.mx


GRUPO DESC: Audit Committee Reports 2004 Results to Board
---------------------------------------------------------
DESC, S.A. de C.V. (BMV: DESC) announced that the following
resolutions were adopted by the applicable shareholders at
Desc's General Ordinary Shareholders Meeting, which was held
yesterday:

I. Presentation of the Report of the Board of Directors, as
provided in Article 172 of the General Corporations Law and the
Report of the Audit Committee of the Board of Directors,
regarding the fiscal year ended December 31, 2004 and
resolutions regarding such reports.

The Report referred to in the general provision of Article 172
of the General Law of Commercial Companies was deemed submitted,
as was the Report of the Board of Directors Audit Committee, for
the fiscal year from January 1 and December 31, 2004, which were
available to the shareholders in advance of the meeting in
accordance with the applicable provisions, together with the
consolidated and unconsolidated Financial Statements of the
Company and of the subsidiaries where the Company's investment
exceeds 20% of its consolidated net worth, as well as those that
contribute more than 10% to the total assets or profits of DESC,
S.A. de C.V., duly audited by the external auditors (Desc
Automotriz, S.A. de C.V. and Cantiles de Mita, S.A. de C.V.)

II. Ratification of the actions undertaken by the Board of
Directors and the Board Committees during fiscal year ended
December 31, 2004.

Any and all of the actions taken by the Board of Directors of
DESC, S.A. de C.V. and its Committees during the fiscal year
ended December 31, 2004 were unanimously approved and ratified.

III. Discussion, approval or modification, if appropriate, of
the Financial Statements of the Corporation as of December 31,
2004, with the prior reading of the Report of the Statutory
Examiner.

The consolidated and unconsolidated financial statements of the
Company through December 31, 2004, were unanimously approved,
consisting of the General Balance Sheet, the Profit and Loss
Statement, the Statement of Stockholders Equity and the
Statement of Changes in the Financial Situation of DESC, S.A. de
C.V., with their Notes, audited by the company's external
auditors, in the form that they were presented at the
Shareholders' Meeting, upon prior reading of the Statutory
Auditor's Report.

IV. Resolutions on the application of results.

The net loss for the fiscal year, which is in the amount of
MXP196,189,203.28, was unanimously applied against the
Accumulated Profit Account.

V. Election or reelection, as the case may be, of the members of
the Board of Directors, as well as the Board Committee members,
and the Statutory Examiners.

a) Pursuant to Clause Twenty-Sixth of the bylaws, it was
resolved that the Board of Directors will be comprised of 11
Directors, of which 6 Directors shall be elected by majority
vote of the Series "A" shares represented at the Shareholders'
Meeting and 5 Directors shall be elected by majority vote of the
Series "B" shares represented at the Shareholders' Meeting.

b) By unanimous vote of those present, the following persons
were elected members of the Board of Directors of DESC, S.A. de
C.V., who being present or having had knowledge of their
possible election, have given their acceptance of their
appointments.

BOARD OF DIRECTORS

SERIES "A" DIRECTORS

FERNANDO SENDEROS MESTRE               Patrimonial/ Related
ALBERTO BAILLERES GONZALEZ             Related
PABLO JOSE CERVANTES BELAUSTEGUIGOITIA Independent
FEDERICO FERNANDEZ SENDEROS            Patrimonial/ Related
CARLOS GOMEZ Y GOMEZ                   Patrimonial/ Related
ERNESTO VEGA VELASCO                   Related

SERIES "B" DIRECTORS

RUBEN AGUILAR MONTEVERDE               Independent
VALENTIN DIEZ MORODO                   Independent
CARLOS GONZALEZ ZABALEGUI              Independent
PRUDENCIO LOPEZ MARTINEZ               Independent
LUIS TELLEZ KUENZLER                   Independent

c) For purposes of the provisions of the Code of Better
Corporate Practices, it was recorded that of the 11 Directors
elected at the Shareholders' Meeting, that the company to date
has 3 Related Patrimonial Directors; 6 Independent Directors;
and 2 Related Directors.

d) It was unanimously resolved that the Evaluation and
Compensation Committee be composed of 3 Directors; the Audit
Committee, by 3 Directors; and the Finance and Planning
Committee, by 4 Directors.

e) By unanimous vote of those present, the following Directors
were appointed members to the Executive, Evaluation and
Compensation, Audit, and Finance and Planning Committees:

EVALUATION AND COMPENSATION COMMITTEE

ERNESTO VEGA VELASCO           Chairman
VALENTIN DIEZ MORODO
CARLOS GONZALEZ ZABALEGUI

AUDIT COMMITTEE

PRUDENCIO LOPEZ MARTINEZ       Chairman
ERNESTO VEGA VELASCO
RUBEN AGUILAR MONTEVERDE

FINANCE AND PLANNING COMMITTEE

FERNANDO SENDEROS MESTRE       Chairman
FEDERICO FERNANDEZ SENDEROS
CARLOS GOMEZ Y GOMEZ
ERNESTO VEGA VELASCO

f) By unanimous vote of those present, Messrs. Jose Manuel Canal
Hernando and Daniel del Barrio Burgos were, respectively,
appointed to the offices of Statutory Examiner and Alternate
Statutory Examiner.

VI. Resolution on the compensation to the Directors and the
Statutory Examiners.

It was unanimously resolved that the members of the Board of
Directors, and the Statutory Auditors, whether or not
Alternates, of DESC, S.A. de C.V., will continue receiving a fee
of $25,000.00 Mexican Currency (TWENTY-FIVE THOUSAND AND 00/100
PESOS, MEXICAN CURRENCY) for each Board of Directors Meeting
that they attend, and for each meeting that they attend of the
Evaluation and Compensation, Audit, and Finance and Planning
Committees.

Further, the Committees were authorized to incur, as applicable,
additional expenses on studies or work required to fulfill their
functions, provided that any such expenses must be duly
explained and approved by the Chairman of the Board of
Directors.

The aforesaid remuneration and additional expenses shall be paid
by charging the General Expense Account corresponding to the
fiscal year when they are actually paid.

VII. Report of the Board of Directors, as provided in Article
60, Section III of the General Rules Applicable to Securities'
Issuers and Other Participants of the Securities Market issued
by the National Banking and Securities Commission.

The Secretary of the Board of Directors reported that, in
accordance with Article 60, Section III of the General
Provisions Applicable to Securities' Issuers and Other
Participants in the Securities Market issued by the National
Banking and Securities Commission, no repurchase operations of
the Desc's shares were completed during fiscal year 2004.

VIII. Designation of deputies to formalize the resolutions
adopted at the meeting.

By unanimous vote of those present, Messrs. Fernando Senderos
Mestre, Ernesto Vega Velasco, Juan Marco Gutierrez Wanless,
Arturo D'Acosta Ruiz, Ramon F. Estrada Rivero y Fabiola G.
Quezada Nieto were named as Delegates of this Shareholders
Meeting in order that, jointly or severally, they carry out the
acts necessary to formalize and give compliance to the
resolutions adopted by this Shareholders Meeting, and process
the formalization before a Notary Public of these minutes in
relevant part, signing the relevant instrument, and process
themselves or through a third party, their recording with the
Public Registry of Commerce.

IX. Reading and approval of the minutes of this meeting.

The minutes were approved in all their terms, which were
prepared and read by the Secretary. The Chairman, the Secretary
and the Statutory Examiner are authorized to sign them for the
record.

About DESC

DESC, S.A. de C.V. (BMV: DESC) is one of the largest industrial
groups in Mexico, with 2004 sales of approximately US$ 2 billion
and nearly 14,000 employees, which through its subsidiaries is a
leader in the Automobile Parts, Chemical, Food and Property
sectors.

CONTACT: Mr. Marisol Vazquez-Mellado
         Mr. Jorge Padilla
         Phone: (5255) 5261-8044
         E-mail: investor.relation@desc.com.mx

         Ms. Maria Barona
         Ms. Melanie Carpenter
         Phone: 212-406-3690
         E-mail: desc@i-advize.com


GRUPO MEXICO: Net Profit Jumps 51% YOY for 1Q05
-----------------------------------------------
Grupo Mexico, S.A. de C.V. (BMV: GMEXICOB) reported its results
today for the first quarter and the three months ended March 31,
2005.

HIGHLIGHTS:

- Southern Peru (SPCC) completes its acquisition/merger of
Minera Mexico (MM) in a stock-for-stock transaction,
consolidating results as of April 1st and creating the world's
second largest mining company in terms of copper ore reserves.
GMexico now owns 75.1% of SPCC.

- A major performance in sales, EBITDA and earnings over
previous years in both our SPCC and Minera Mexico (MM) mining
units and Ferromex. Copper production prices were set at $1.51
per pound for the next three months in order to ensure an EBITDA
similar to 1Q05.

- Consolidated sales increased during 1Q05 to $1,246.1 million,
43% higher than 1Q04 total sales and 5% lower than the 1,315
million recorded in 4Q04, as a result of SPCC's slight sales
volume reduction as compared to 4Q04.

- EBITDA increased 52% vis-a-vis 1Q04 and reached $614.1 million
for an EBITDA margin of 49.0% on sales.

- As a result of increased production volumes, particularly
molybdenum and zinc, and metal price improvements, consolidated
operating profit rose to $530.7 million in 1Q05, 59% higher than
the same quarter in 2004.

- 1Q05 Consolidated net profit increased to $250.6 million, 51%
higher than the $165.6 million posted for the same quarter in
2004.

- Steady increase in prices for metals in our production line:
285% in molybdenum, 23% in zinc, 19% in copper, and 4% in silver
as compared to 1Q04.

- Due to its positive performance, MM was able to make a debt
prepayment for $120 million on its $600-million syndicated loan,
cutting it down to $480 million.

- GMexico prepaid $75 million on its $310-million loan facility
with Banco Inbursa, bringing it down to $175, at the Mining
Division's (AMC) holding company level. An additional payment of
$7.5 million was also made on its $15-million loan with Calyon
Bank.

- Net debt in the 1Q05 was reduced by $209.9 million from $1,543
million in 4Q04 to $1,333 million.

- Effective December 2004, Ferromex implemented a pricing
formula in order to allow for the recovery of diesel cost
increments as it is done by American rail companies, for the
purpose to better reflect the co-relation between volumes moved
and sales.

RELEVANT EVENTS

1. On March 28, the stockholders of Southern Peru Copper
Corporation (SPCC) at a Special Meeting approved the merger of
SPCC and Minera Mexico, S.A. de C.V. (MM) by over 90% of the
shareholders. As a result of such decision, SPCC acquired 99.15%
of MM's shares of stock and issued approximately 67,2 million
new shares to the order of Americas Mining Corporation, MM's
majority shareholder. In addition, the newly merged SPCC-MM,
requested forthwith that all of the company's Class A shares, or
founding partner shares, be converted into shares of common
stock. Thus, SPCC will have one single series of common shares.
SPCC will continue listing in the New York and Peru Stock
Exchanges and as of April 1st, shall report to the regulating
authorities in both countries with consolidated results together
with MM, now acquired by SPCC.

Southern Peru Copper Corporation now is the world's largest
copper mining company in terms of copper ore reserves listed in
New York and Peru, and the second largest in terms of market
capitalization.

2. The awareness and responsibility of the Steel Workers Union,
which represents workers of the Mission, Amarillo, Hayden, and
Silver Bell units, as well as the unwavering commitment of the
company's management, has allowed for continued conciliatory
negotiations, even though the time limits set for initiating a
strike have expired, thus importantly contributing to the
recovery of Asarco and helping to preserve a source of
employment.

FINANCING

GMexico's total debt at March 31, 2005 amounted to $2,282.9
million; with a cash balance of $949.3 million equal to a net
debt of $1,333.6 million. Cash at the close of December 2004 was
$973.5 million, for a net debt of $1,543.4 million vs. $1,333.5
million at March 2005. This ratio provides a debt reduction of
$209.9 million during 1Q05, accounting for a 14% net debt
decrease vis-a-vis the close of the year 2004. The debt/equity
ratio for 1Q05 was 51.6% and Net Debt/ EBITDA LTM ratio of 61.6%
The financial cost for the first quarter of 2005 was $51.6
million, 7.7% less than the same quarter in 2004, due to a major
reduction in the Group's liabilities and recently improved rate
conditions obtained by MM and SPCC, which will reflect on
further savings in the financial cost over subsequent quarters.

On March 30, MM prepaid $120 million from a syndicated loan. In
exchange for such prepayment, MM was awarded a significant
interest rate reduction, going from Libor plus 200 basis points
to Libor plus 112.5 basis points for the next 6 months. The
transaction was funded with the proceeds of MM cash flow
operations, thus fulfilling the goal and commitment of providing
the company with a more sound and efficient financial structure.
After such prepayment, MM's total debt is reduced by almost 12%,
from $1,041.2 million to $921.2 million, producing a debt/equity
ratio of 43% and a debt/EBITDA LTM ratio of 1.2x.

On January 31, SPCC signed a $200 million syndicated bank
facility led by Citigroup, BNP Paribas and Scotiabank. The
proceeds were used to prepay all of the bonds issued in the
Peruvian capital markets. In January 2005, SPCC paid $150
million plus interest from four issues made during the years
2001, 2002 and 2003. Then in March and April of this year, SPCC
will pay the two series of bonds outstanding issued in 2000. The
terms and conditions of this credit facility are better than
those granted for the existing bonds.

GMexico prepaid $75 million on its $310-million loan facility
with Banco Inbursa, bringing it down to $175, at the Mining
Division's (AMC) holding company level. An additional payment of
$7.5 million was also made on its $15-million loan with Calyon
Bank.

With this, Grupo Mexico fulfills its commitment to improve the
financial conditions of its subsidiaries by cutting back on
liabilities, improving its amortization profile and eliminating
warranties and restrictions, thus affording efficient growth of
operations and reducing its financial costs as well.

MINING DIVISION

AMERICAS MINING CORPORATION

Metals Market

Metal prices continued their marked upward trend throughout the
first quarter of 2005, with relevant increments mostly in the
case of molybdenum at 285%, zinc at 23%, and copper at 19% over
1Q04. A sound growth trend in copper demand during 1Q05 is
evident in all the consumer economies and was particularly high
in China. This, together with a higher demand in the United
States, contributed to a continuing deficit in global metal
inventories during the first months of 2005, down from 136,0000
to 99,520 tons. A weaker dollar also contributed to rising
copper prices, reaching historical 15-year highs. Analysts
expect the deficit in copper supplies will continue during 2005.

The policy of GMexico, the world's second largest company in
copper reserves, is to carry out its projects gradually, through
discipline and responsibility, in order to supply the markets
and thus ensure adequate returns to its shareholders in the long
term, without undue statements of grandeur that only confuse the
market.

Financial Highlights

Sales of the mining sector (AMC) during 1Q05 increased by 49.5%
to $1,091.3 million, while the cost of sales rose 37.6% for a
net profit of $227.0 million, 53.5% higher than that registered
last year.

1Q05 sales at $1,091.3 million decreased 5% over 4Q04 due to
reduced sales volumes from lower ore grades in the Peru mines
and a decline in Mexico's mining production as a result of the
largest rainfall recorded over the past 10 years last February,
which particularly affected the Cananea and Ray mines.

At $560.2 million, EBITDA increased 62% over 1Q04. The EBITDA
margin as a percentage of sales increased from 47.4% to 51.3%
Americas Mining Corporation is a Delaware-based corporation and
the holding company for the Mexico, United States and Peru
mining operations. It ranks as the world's second largest
company in terms of copper ore reserves, the third largest mine
to refined copper producer, the fourth largest silver producer,
and the seventh largest zinc producer.

MINERA MEXICO
Financial Highlights

Copper production in 1Q05 was 80,804 MT, 5.1% lower than in 2004
for the same period, mostly due to the highest rainfall recorded
over the past 10 years at the Cananea mine, which caused severe
flooding in the pits.

The decline in copper production was offset by a 5% increase in
molybdenum production and climbing metal prices, which
contributed to the $458.8 million sales recorded in 1Q05, a
39.7% increase over the same period in 2004 and 12.5% over 4Q04.
On the other hand, the cost of sales in 1Q05 at $199.6 million
was 31.3% higher than last year for the same period, primarily
as a result of important energy and other cost increases in
Mexico, particularly electricity and diesel fuel.

For the first time in history, MM reached a cash operating
breakeven point of less US$(0.5) cents per pound of copper at
March 31, 2005, versus US$36.9 cents recorded last year for the
same period, due to the rallying prices in our different by-
products and a 5% increase in molybdenum production volumes.

MM's 1Q05 EBITDA increased by 49% from $166.8 to $249.0 million.
EBITDA margin as a sales percentage increased from 50.8% to
54.3% in 1Q05 as compared to the same period in 2004.

MM reported a net profit increase of 41.9%, from $96.2 in 1Q04
to $136.6 million in 1Q05.

Minera Mexico is the largest mining company in Mexico. Its two
large open pit mine operations are Cananea, the world's fourth
largest minein terms of reserves and the first in terms of
"years of operation", and the metallurgical mining complex La
Caridad, which includes copper smelting and refining, a wire rod
plant and a precious metal refinery. Its other operations
include four poly-metallic underground mining units and a zinc
refinery.

SOUTHERN PERU COPPER CORPORATION
Financial Highlights

On March 28, the stockholders of Southern Peru Copper
Corporation (SPCC) at a Special Meeting approved the merger of
SPCC and Minera Mexico, S.A. de C.V. (MM) by over 90% of the
shareholders. As a result of such decision, SPCC acquired 99.15%
of MM's shares of stock and issued approximately 67,2 million
new shares to the order of Americas Mining Corporation, MM's
majority shareholder.

In addition, the newly merged SPCCMM, requested forthwith that
all of the company's Class A shares, or founding partner shares,
be converted into shares of common stock. Thus, SPCC will have
one single series of common shares. SPCC will continue listing
in the New York and Peru Stock Exchanges and as of April 1st,
shall report to the regulating authorities in both countries
with consolidated results together with MM, now acquired by
SPCC.

Copper mine production in 1Q05 was 80,945 MT, 14.6% less than in
2004 for the same period. This 13,881 MT decline includes 4,783
MT from the Toquepala mine and 9,097 MT from the Cuajone mine,
and was mostly due to lower ore grades as forecast.

Product sales totaled $486.2 million in 1Q05, a 77.4% increase
over the $274.0 million recorded last year for the same period.
Key drivers of revenue were larger sales volumes and metal price
increases, particularly molybdenum.

EBITDA for 1Q05 rose 93.5% from $156.0 to $301.9 million. At the
same time, SPCC's cash on hand increased 161.5% and reached
$722.2 million at March 31, 2005. EBITDA margin as a sales
percentage rose from 56.9% to 62.1% in 1Q05 as compared to the
same period in 2004.

The company's net profit was 116.1% higher than in 1Q04 and
totaled $187.6 million as compared to $86.8 million in 1Q04. The
cash operating breakeven point for copper production at SPCC was
less (33.0) cents and 39.90 cents in 1Q05 and 1Q04,
respectively. This accounts for a reduction of 8 times due to
rallying prices in our by-products, particularly molybdenum,
which also posted larger production volumes.

As for SPCC's expansion and modernization program, the Ilo
smelter project is on schedule, with detailed engineering work
in progress and procurement of larger equipment in order to
complete the project by year end 2006.

In addition, the ore crushing, leaching and conveyor belt
project at the Toquepala mine is also on schedule. In March
2004, a construction contract was awarded to Cosapi, a Peruvian
contractor. The contract is part of the $70-million project
scheduled for completion in mid-2005. This project will increase
SX/EW copper recovery and allow for annual savings of $25
million in operating costs at Toquepala.

On January 26, SPCC signed a $200 million syndicated bank
facility led by Citigroup, BNP Paribas and Scotiabank. The
proceeds were used to prepay all of the bonds issued in the
Peruvian capital markets. In January 2005, SPCC paid $150
million plus interest from four issues made during the years
2001, 2002 and 2003. Then in March and April of this year, SPCC
will pay the two series of bonds outstanding issued in 2000. The
terms and conditions of this credit facility are better than
those granted for the existing bonds.

Southern Peru Copper Corporation (SPCC) is the world's largest
copper mining company in terms of ore reserves listed in New
York and Peru, and the second such largest company in terms of
market capitalization. SPCC shareholders, directly or through
subsidiaries, are as follows: Grupo Mexico (75.1%), Cerro
Trading Company (7.7%), Phelps Dodge (7.6%) and other common
shareholders (9.6%)

ASARCO, LLC.
Financial Highlights

Copper production in 1Q05 was 40,786 MT, slightly lower than in
2004 for the same period. This as a result of the largest
rainfall recorded in the past 10 years at the Ray mine last
February, which flooded the pit and affected for 10 days the ore
crushing and conveyor belts commuting to the Ray metallurgical
complex.

As for the company's investment and acquisition projects, $16.9
million were invested in 1Q05, 8.5 times higher than in 2004 for
the same period. $12.3 million were assigned to the Hayden
Smelter for its 5-year maintenance service, so that work was
interrupted for 50 days last January and February. Such
maintenance will enable the smelter to operate at full capacity
and lower their unit costs.

The decline in copper production was offset by a 3.4% sales
volume increase and rising metal prices, which contributed to
the $159.2 million sales recorded in 1Q05, a 17.7% increase over
the same period in 2004 and 29.4% over 4Q04.

The cost of sales in 1Q05 was $136.1 million, 35.3% higher than
the previous year's for the same period. This cost increase was
mostly due to the 122% increase in tonnage load moved according
to the mine stripping and equipment maintenance plan designed to
upgrade availability to industry standards.

Asarco's EBITDA was $16.2 million in 1Q05 as compared to $29.6
million for the same period in 2004 and 19% higher than the
$13.6 million recorded in 4Q04.

Asarco reported a net profit of $2.0 million in 1Q05 as compared
to $16.4 million for the same period in 2004.

On April 11, Asarco LLC announced its decision to file Chapter
11 proceedings in Bankruptcy Court for its non-operating and
dormant subsidiaries LAQ and CAPCO, in which all asbestos-
related claims will be channeled to a trust for an equitable
resolution and payment.

The awareness and responsibility of the Steel Workers Union,
which represents workers of the Mission, Amarillo, Hayden, and
Silver Bell units, as well as the unwavering commitment of the
company's management, has allowed for continued conciliatory
negotiations, even though the time limits set for initiating a
strike have expired, thus importantly contributing to the
recovery of Asarco and helping to preserve a source of
employment.

Founded in 1899, Asarco is a fully integrated copper mining,
smelting and refining company having important copper reserves
in the United States. The open-pit mining units at Mission, Ray
and Silver Bell in Arizona include electro-winning plant
facilities at Ray and Silver Bell. Asarco operates a copper
smelter in Hayden, Arizona, and has a copper refinery and a
copper rod and cake plant in Texas.

RAILROAD DIVISION
Financial Highlights
Grupo Ferroviario Mexicano (GFM)

Load volumes moved by Ferromex in 1Q05 as measured by tons per
kilometer (tons/km) increased 8.1% as compared to the same
period in 2004, primarily as a result of increasing trade flows
between Mexico and the United States driven by the market's
economic growth and larger domestic volumes.

The cost of sales in 1Q05 was $97.4 million, a 10.2% increase
over the same period in 2004 and a decline of 11.5% over 4T04.
This item was slightly offset by higher transportation volumes
which afforded higher income from services during this quarter.

Nevertheless, cost of sales was adversely affected by
significant diesel cost increases. Diesel prices rallied 32.9%
from $0.276 to $0.367 US cents, which added to the higher liter
consumption accounted for a $6.4 million increase.

Ferromex's EBITDA in 1Q05 totaled $53.0 million, 6.9% higher
than last year's for the same period. EBITDA margin as a sales
percentage remained at 33.3% in 1Q05 as compared to the same
period in 2004.

Operating profit was $36.8 million in 1Q05, 11.8% higher than
1Q04 despite the hike in diesel prices, which is the major
consumable of railway operations.

Investment projects and other asset acquisitions were assigned
$20.4 million for the first quarter of 2005, 167.5% more than in
2004 for the same period. The sum was allocated to
infrastructure renovation and 25 new locomotive acquisitions.

As of March 2005, total debt decreased by $31.3 million, from
$478.2 million at 4Q04 to $446.9 million in 1Q05. Such decrease
derived from amortization payments to Eximbank for $8.0 million
and to Bank of America for $6.6 million. In addition, an early
amortization of $31.7 million to Banco Inbursa on its loan
maturing December 2007 was conducted by the Company, using funds
from the normal course of its operations. This item is partially
offset by the loans granted in December 2004 and January 2005 by
BNP Paribas which included an Eximbank guaranty for US$39.5
million for the acquisition of 25 locomotives.

Effective December 2004, Ferromex implemented a pricing formula
in order to allow for the recovery of diesel cost increments as
it is done by American rail companies, for the purpose to better
reflect the co-relation between volumes moved and sales.

Ferromex is Mexico's largest railway company, providing the
widest coverage. Through a 8,500 km network, its tracks cover
71% of Mexican territory. Ferromex lines connect with five
gateways at the U.S. Border, four ports on the Pacific Ocean and
two ports on the Gulf of Mexico. The company is controlled by
Grupo Mexico (74%) and Union Pacific (26%).

To view financial statements:
http://bankrupt.com/misc/GrupoMex.pdf

CONTACT: GRUPO MEXICO
         Av. Baja California No. 200
         Colonia Roma Sur
         06760 Mexico, D.F.
         Phone: 52 (55) 5080-0050


TFM: Fitch Assigns 'B+' to $460M Issuance
-----------------------------------------
Fitch Ratings has assigned a 'B+' foreign currency rating to the
US$460 million 9.375% senior notes due 2012 issued by TFM, S.A.
de C.V. (TFM). Fitch has also affirmed the 'B+' foreign and
local currency senior unsecured ratings of TFM. The Rating
Outlook is Stable.

The foreign currency rating also applies to TFM's US$150 million
senior notes due 2007 and the company's US$180 million senior
notes due 2012. The proceeds from this new issuance will be used
primarily to repurchase TFM's US$443 million 11.75% senior notes
due 2009 that are also rated 'B+'.

TFM's 'B+' ratings reflect the company's challenging operating
environment, high leverage, flat earnings, and tight liquidity.
Over the last two years, TFM has operated in a challenging
environment characterized by higher fuel costs, a depreciating
Mexican peso versus the U.S. dollar and a general shift in
manufacturing to China from several countries, including Mexico.
This latter factor has resulted in a decline in the shipment of
cargo from some sectors served by the company, including
automotive. In 2004, TFM's revenues of approximately US$700
million were flat vis-a-vis those of 2003.

TFM remains highly levered. As of Dec. 31, 2004, TFM had about
US$1.4 billion in total debt, consisting of US$773 million in
unsecured bonds, a US$133 million term loan and an estimated
US$504 million of off-balance debt associated with lease
obligations. TFM's EBITDAR, which is defined as EBITDA plus the
company's annual locomotive and railcar lease payments, was
US$277 million in 2004 or about the same level as in 2003. The
ratio of total debt-to-EBITDAR has remained at about 5.0 times
(x) throughout the last several years. EBITDAR covered fixed
expenses, defined as interest expense plus lease payments, by
about 1.7x in 2004.

TFM's liquidity is poor with only US$14.2 million of cash as of
Dec. 31, 2004. Fitch believes, that neither the completed
transaction to sell Grupo TMM's indirect stake in TFM to Kansas
City Southern (KCS) nor the resolution of TFM's value added tax
(VAT) claim is likely to provide any cash for debt reduction at
TFM. Despite the continued favorable court rulings for TFM's
claim to an estimated US$1 billion value added tax refund from
the Mexican government, a considerable amount of doubt exists as
to whether any portion of TFM's VAT refund will be in the form
of cash.

The Mexican government holds a PUT option for its 20% equity
interest in TFM. Grupo TFM's shareholder is obligated to acquire
the shares that the government holds in TFM if they are not
purchased by the public. In one scenario, the government could
put its 20% of TFM's shares to Grupo TFM, and Grupo TFM could
acquire the Mexican government's 20% stake in TFM. Because the
government has lost most of the steps in TFM's VAT negotiation
process, it could effectively offset the VAT refund it owes to
TFM with the proceeds of the sale of TFM in a cashless
transaction as proposed by Grupo TFM's shareholders.

Fitch views the transaction completed on April 1, 2005 in which
Grupo TMM sold its 51% voting interest in Grupo TFM to KCS as
being mildly positive for TFM. The transaction replaced TFM's
financially distressed controlling shareholder, Grupo TMM, with
KCS, a U.S. entity that has a stronger financial profile but one
that is also highly leveraged. In addition, TFM will likely be
able to continue refinancing and borrowing at a lower cost under
the control of KCS which is a somewhat stronger financially vis-
a-vis Grupo TMM. Despite becoming the controlling stockholder of
TFM, KCS continues to be a small railway and about two-thirds of
its future operating earnings will be generated by the Mexican
operations.

TFM holds the concession to operate Mexico's northeastern rail
lines and is Mexico's largest railroad by volume. The company
transports more than 40% of Mexican rail volume and owns more
than 2,600 miles of rail track. TFM is the only Mexican carrier
to Laredo, Texas, the largest freight exchange point between the
United States and Mexico. TFM also serves three of Mexico's four
primary seaports and approximately 80% of the company's revenue
is related to international freight. In 2004, TFM's revenues
were generated from the following main industries: agro-
industrial (21%), cement, metals and minerals (20%), chemical
and petrochemical (18%), automotive (17%), manufacturing and
industrial (11%) and intermodal (7%). TFM is an operating
company 80% owned by Grupo TFM and 20% owned by the Mexican
government. KCS now owns all the common stock of Grupo TFM, a
holding company, and controls all of the shares of TFM that
carry full voting rights.


TV AZTECA: Signs Purchase Agreement With Harris Corporation
-----------------------------------------------------------
Harris Corporation (NYSE: HRS) announced Thursday that TV
Azteca, S.A. de C.V., one of the two largest producers of
Spanish language television programming in the world, has signed
a purchase agreement with Harris Corporation's Broadcast
Communications Division for digital television transmitters, and
high-definition encoding equipment for HDTV. The equipment will
bring HDTV to nine cities in M‚xico and will be launched in two
phases through mid-2006.

The new equipment places TV Azteca at the forefront of digital
transmission capabilities in Latin America and will allow for
HDTV transmission in M‚xico City, Guadalajara and Monterrey by
the third quarter of this year. The services are in accordance
with a rollout plan detailed by TV Azteca in August 2004. Phase
Two of the national rollout will bring HDTV services to six
additional cities (Matamoros, Reynosa, Nuevo Laredo, Ciudad
Juarez, Mexicali and Tijuana) through the first half of 2006.

"This is another example of how TV Azteca sets technology
standards to benefit viewers throughout Latin America," said
Mario San Rom n, CEO of TV Azteca. "This announcement also
implies that our first stations will be on the air at least 15
months ahead of the digital upgrade commitments confirmed with
Mexican authorities."

According to Rom n Gomez, TV Azteca Director of Engineering and
Technology Development, Harris was selected as the vendor of
choice following a careful and thorough analysis of Harris and
competitive suppliers. "The technology, air signal, reliability,
price and our long-term relationship with Harris were key
factors in our selection," said G˘mez. "We have a 12-year track
record with Harris transmitters."

The initial TV Azteca order includes six Harris DiamondCDr
DHD8P1 transmitters operating at 1.8 kW. DiamondCD transmitters
have been among the most popular transmitters employed for the
U.S. digital TV rollout, with more than 300 deployed in the U.S.
at power levels from 1.8 kW to 35 kW. TV Azteca can readily
expand the DHD8P1 for additional power output by adding power
amplifiers and power supplies. The DiamondCD DHD8P1 transmitter
includes the Apex(TM) advanced digital TV exciter, with over 400
installations since its introduction in 2002.

"Harris Corporation is pleased to continue its strategic
relationship with TV Azteca as it starts deployment of digital
television. Harris has established a broad base of content
delivery solutions from its leadership position in U.S. digital
television, and we are honored to be selected to extend these
market-proven solutions to M‚xico as TV Azteca commences its
commercial deployment of digital television," said Dale Mowry,
vice president and general manager of Television Broadcast
Systems for Harris Broadcast Communications.

"This project is consistent with our efforts throughout the
region to guide customers to a fast and economical conversion to
digital throughout their broadcast operations," said Nahuel
Villegas, Harris Broadcast Communications' regional sales
director for Latin America and the Caribbean.

Harris' turnkey solution will allow viewers with HDTV sets to
receive picture resolution six times sharper than standard
definition analog sets. TV Azteca viewers without HDTV sets will
continue to receive their television programming through analog
transmission approaches.

About TV Azteca

TV Azteca is one of the two largest producers of Spanish
language television programming in the world, operating two
national television networks in M‚xico, Azteca 13 and Azteca 7,
through more than 300 owned and operated stations across the
country. TV Azteca affiliates include Azteca America Network, a
new broadcast television network focused on the rapidly growing
U.S. Hispanic market, and Todito.com, an Internet portal for
North American Spanish speakers.

About Harris Broadcast Communications Division

Harris Broadcast Communications Division is one of four
divisions within Harris Corporation, an international
communications equipment company focused on providing assured
communicationsT products, systems and services for government
and commercial customers in more than 150 countries. One of the
world's leading suppliers of broadcast technology, Harris
Broadcast Communications Division offers a full range of
solutions that support the digital delivery, automation and
management of audio, video and data.

CONTACT:  Harris Broadcast Communications Division
          Martha Rapp
          E-mail: martha.rapp@harris.com
          Tel: +1 217 221 7577

          Pipeline Communications
          Robin Hoffman
          E-mail: robinh@pipecomm.com
          Tel: +1 973 746 6970

          TV Azteca
          Daniel McCosh
          E-mail: dmccosh@tvazteca.com.mx
          Tel: +5255 1720 0059



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

PDVSA: CITGO Denies Allegations of Financial Distress
-------------------------------------------------------
The NY Times published an article on CITGO Petroleum Corporation
on Thursday. The headline, The Troubled Oil Company, leads the
reader to believe that the company is in poor shape yet, later
in the article, the writer points out the company's impressive
results for 2004.  Clearly, CITGO remains a vibrant, extremely
strong company with record earnings, excellent safety and
environmental performance and good operations.

CITGO continues to file all required reports with the Securities
and Exchange Commission (SEC) in a timely manner. The company
recently filed its 2004 Form 10-K, which includes comparative
balance sheet information for the past two years and comparative
income statement information for the past three years. Those
financial statements have been audited by a "Big Four"
registered independent accounting firm. As an SEC-registered
company, CITGO is subject to section 302 of the Sarbanes Oxley
Act. Certifications by CITGO's CEO and CFO have been
incorporated into those filings.  CITGO's SEC reports are
available on the company's Web site, www.CITGO.com.

In addition to the independent auditor review, CITGO has a
disclosure committee comprised of senior-level executives who
review all financial and operating information prior to being
disclosed publicly.

As a refiner, transporter and marketer of transportation fuels,
lubricants, petrochemicals, refined waxes, asphalt and other
industrial products, CITGO is owned by PDV America, Inc., an
indirect wholly owned subsidiary of Petroleos de Venezuela,
S.A., the national oil company of the Bolivarian Republic of
Venezuela.

Venezuela, through PDVSA, has made substantial investments in
CITGO, allowing CITGO to grow dramatically and become a major
player in the world's energy market. For example, CITGO recently
completed a $300 million, 105,000 barrel-per-day (bpd) crude
capacity expansion at its Lake Charles, La. refinery, making
that facility the fourth largest in the United States. Thus,
CITGO is a key component of Venezuela's strategy to maintain a
strong presence in the United States and the company continues
to evaluate opportunities to improve its operations.

As part of the global PDVSA family, and as is the case in other
multi-national corporations, senior executives are rotated
periodically throughout the company to gain international
experience.  In CITGO's case, Venezuelan employees have held
leadership positions for many years. In fact, Felix Rodriguez,
an industry veteran with more than 30 years of experience, was
recently named CITGO's president and CEO after serving as
PDVSA's vice president of exploration and production. It should
also be noted that more than half of CITGO's senior staff remain
non-Venezuelan employees.

As a result of the dedication and contributions of the nearly
4,000 employees of the CITGO family, the company has established
a tradition of success, continuing to provide the quality
petroleum products for which the CITGO brand is known.

CONTACT: CITGO Petroleum Corporation
         Investor Relations
         Ms. Kate Robbins
         Public Affairs Manager
         Phone: (832) 486-5764
         E-Mail: InvRel@citgo.com




PDVSA: Venezuela, Chile Work for Stronger Energy Ties


ROYAL SHELL: Publishes 2004 Results Under IFRS
----------------------------------------------
On 22 November 2004 the Royal Dutch/Shell Group of Companies
presented the accounting impacts of the adoption of
International Financial Reporting Standards (IFRS). This
provided information on the transition adjustment from US
Generally Accepted Accounting Principles (GAAP) at 1 January
2004 and guidance on the impact for 2004.

Published Thursday are the Group's 2004 quarterly and annual
results under IFRS, which will be the comparative data presented
in its 2005 quarterly results announcements and annual report.
These results are subject to the adoption by 31 December 2005 of
any further IFRS pronouncements. Furthermore, these results are
subject to completion of the proposed unification, which will
require that the 2005 financial statements be prepared for Royal
Dutch Shell plc.

Starting with the financial results announcement for the first
quarter of 2005 on 28 April 2005, the Group will be reporting
its 2005 quarterly and annual results under IFRS.

The schedules provided show a reconciliation to 2004 financial
statements for the Group as published in the 2004 Form 20-F
filed with the Securities and Exchange Commission (SEC) on 30
March 2005.

Impacts from IFRS arise from first time adoption choices and
differences in accounting policies and in presentation format
between US GAAP and IFRS. There is no impact on the Group's
strategy, financial framework and there is only a minor movement
in cash and cash equivalents.

Consistent with advice provided in November 2004 on the IFRS
impact, the key changes to the financial statements are:

Income statement

- 2004 Group net income increases $358 million from $18.2
billion under US GAAP to $18.5 billion under IFRS. Main
individual items contributing to the increase arise from the
IFRS treatment of accounting for major inspection costs (+$0.2
billion), additional impairments (-$0.3 billion) and reversals
of impairments (+$0.5 billion), pension costs (-$0.2 billion),
share-based compensation (-$0.1 billion) and lower charges for
cumulative currency translation differences (CCTD) on
divestments (+$0.1 billion) (see further details below).

- The IFRS presentation format has been adopted.

- Presentation changes from US GAAP to IFRS are:

- Discontinued operations adjustments: the definition of
activities classed as 'discontinued operations' differs from
that under US GAAP. As a result only earnings from the
polyolefins joint venture Basell, which is held for sale, are
classified as 'income from discontinued operations' in 2004.

- IFRS reclassifications of reported line items:

i. Certain joint ventures are accounted for using the equity
method under IFRS and were previously proportionately
consolidated. This impacts individual line items in the
financial statements but has no effect on income;

ii. The 'share of profit of equity accounted investments' is now
shown net of finance costs and tax;

iii. Accretion expense for asset retirement obligations is now
shown in 'net finance costs'; and

iv. Research and development costs are included in 'cost of
sales'.

Balance sheet

- Net assets at transition on 1 January 2004 decrease by $4.7
billion. Net assets at 31 December 2004 decrease by $4.5 billion
and total debt increases by $0.2 billion (see further details
below).

- The IFRS presentation format has been adopted.

- Presentation changes from US GAAP to IFRS are
reclassifications of reported line items:

i. Certain joint ventures are accounted for using the equity
method under IFRS and were previously proportionately
consolidated. This impacts individual line items in the balance
sheet but has no effect on Group equity; and

ii. Provisions require reporting on separate lines on the
balance sheet.

Statement of Cash flow

- The IFRS presentation format has been adopted.

- Under the IFRS format, the amounts of taxation accrued and
taxation paid are shown separately within 'cash flow from
operating activities', rather than within working capital
movements.

- Reported 'cash flow from operating activities' in 2004 has
increased by $1.4 billion with an offset in cash flow from
investing and financing activities. This is mainly due to:

- The different presentation of interest (interest paid is now
included in financing activities and interest received in
investing activities) with an effect of $0.5 billion;

- Write offs of previously capitalised exploratory well costs
are now added back within 'cash flow from operating activities'
in 'other' and not deducted from capital expenditure with an
effect of $0.5 billion; and

- Major inspection costs are capitalised (and therefore shown in
'investing activities') and were previously expensed. This has
an effect of $0.4 billion.

Key adjustments to reflect accounting policies under IFRS are
described below:

Employee benefits (pension funds)

- As stated in November 2004, there is no impact on the
actuarial position or funding of the pension funds, which
continue to be well funded.

- Unrecognised gains and losses related to defined benefit
pension arrangements and other post retirement benefits at the
date of transition (1 January 2004) have been recognised in the
2004 opening balance sheet, with a corresponding reduction in
Group equity (net assets) of $4.9 billion. During 2004 the pre-
tax net liability recognised in the balance sheet under IFRS
decreased from $5.8 billion at 1 January 2004 to $4.7 billion at
31 December 2004. Under US GAAP the pre-tax net asset recognised
increased from $1.7 billion at 1 January 2004 to $3.3 billion at
31 December 2004.

- The use of the fair value of pension plan assets (rather than
market-related value) to calculate annual expected investment
returns and the changed approach to amortisation of investment
gains/losses can be expected to increase volatility in income
going forward.

- Under IFRS there is an additional charge in 2004 for defined
benefit pension arrangements of $0.2 billion after tax.

Net equity and CCTD

- At transition (1 January 2004), the composition of net equity
changed because the balance of cumulative currency translation
differences (CCTD) under US GAAP of $1.2 billion was eliminated
to increase retained earnings. Neither net assets nor equity in
total were impacted. Because of this elimination, the amount of
CCTD charged to income on disposals in 2004 was lower by $0.1
billion under IFRS compared with US GAAP.

- In 2004 and going forward, CCTD will continue, reflecting
currency translation effects on net assets of entities with non-
US dollar functional currencies.

Impairments and reversals of impairments

- IFRS requires the use of discounted cash flows for impairment
testing and may also require impairment reversals when
circumstances change. Under this methodology, in 2004 previous
impairments of certain Exploration & Production assets (Aera and
Venezuela) have been reversed (with a credit to income of $0.5
billion). Also certain North American tolling assets in Gas &
Power and certain Chemicals assets required impairment and the
amount of the impairment for Basell differed under IFRS from
that under US GAAP (with a combined net charge to income of $0.3
billion).

Major inspection costs

- Major inspection costs are capitalised using the 'Solomon'
industry definition of major inspection. At transition (1
January 2004), net assets increased by $0.4 billion.

- The impact on income going forward is reflected in lower
operating costs and higher depreciation, having a net positive
effect on income in 2004 of $0.2 billion.

Share-based compensation

- Share options awards made after 7 November 2002 and not vested
at 1 January 2005 are expensed rather than the previous practice
of pro forma disclosure in the notes to the financial
statements. 2004 income was reduced by $0.1 billion.

Other

- There were other minor differences arising mainly from IAS 12
Income Taxes, IAS 16 Property, Plant and Equipment and IAS 17
Leases.

The main reasons for changes in earnings by industry segment
under IFRS are:

Exploration & Production

The reversals of impairments (Venezuela and Aera) and lower CCTD
charges on divestments.

Gas & Power

The North American tolling impairment.

Oil Products

Capitalisation of major inspection costs and the effect of CCTD
on divestments, partly offset by additional pension charges.

Chemicals

The lower impairment of Basell and other impairments as a result
of the IFRS adoption.

Other & Corporate

The reclassification of certain operating leases as finance
leases increases net finance costs.

The schedule of the 2004 quarterly results under IFRS can be
downloaded from www.shell.com/investor under "Quarterly
Results". Full details of the Group's accounting policies under
IFRS will be made available on this site on 28 April 2005.

CONTACT: Shell Transport & Trading Company and Royal Dutch
Petroleum Company
         Investor Relations -
         London: Gerard Paulides
                 Tel: +44-(0)207-934-6287
         Europe: Bart van der Steenstraten
                 Tel: +31-70-377-3996
         USA: Harold Hatchett
              Tel: +1-212-218-3112

         Media Relations
         International and UK: Stuart Bruseth
                               Tel: +44-(0)207-934-6238
                               Simon Buerk
                               Tel: +44-(0)207-934-3453
                               Lisa Givert
                               Tel: +44-(0)207-934-5914
                               Biana Ruakere
                               Tel: +44-(0)207-934-4323
                               Susan Shannon
                               Tel: +44-(0)207-934-3277

         The Netherlands: Herman Kievits
                          Tel: +31-70-377-8750



                            ***********

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 America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
Lucilo Junior M. Pinili, Editors.

Copyright 2005.  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 written permission of the publishers.

Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are $25 each.  For subscription
information, contact Christopher Beard at 240/629-3300.


* * * End of Transmission * * *