/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/120802.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 Thursday, August 2, 2012, Vol. 13, No. 153 Headlines A N T I G U A & B A R B U D A LIAT: Names Ian Brunton As New Chief Executive Officer A R G E N T I N A ALTERNATIVO SRL: Files for Bankruptcy EMPRENDIMIENTOS INMOBILIARIOS: Asks for Bankruptcy Proceedings INMANTEC SRL: Asks for Bankruptcy Proceedings OSATO SA: Creditors' Proofs of Debt Due Aug. 30 PLASTIC SAN: Applies for Bankruptcy Protection REEFER CONTROL: Creditors' Proofs of Debt Due Sept. 18 RENACITY INVESTMENT: Applies for Bankruptcy Protection SALON DORADO: Asks for Bankruptcy Proceedings * BUENOS AIRES: Moody's Assigns 'B3' Rating to Series 2 Bonds B R A Z I L BANCO BARCLAYS: Moody's Assigns 'D' BFSR; Outlook Stable HYPERMARCAS SA: S&P Affirms 'BB-' Issuer Credit Ratings RAIZEN ENERGIA: S&P Ups Ratings on Cosan Notes From 'BB' C A Y M A N I S L A N D S BIO/PHARMACCELERATOR: Shareholders' Final Meeting Set for Aug. 27 BUNYAN 2 FINANCE: Shareholders' Final Meeting Set for Aug. 17 CT OPPORTUNITY: Shareholder to Hear Wind-Up Report on Aug. 13 GEMINI CAYMAN: Shareholders' Final Meeting Set for Aug. 17 GREENLAKE INVESTMENT: Shareholders' Final Meeting Set for Aug. 17 INJET400 AIRCRAFT: Shareholders' Final Meeting Set for Aug. 17 INJET800 AIRCRAFT: Shareholders' Final Meeting Set for Aug. 17 K SERA SERA: Sole Member to Hear Wind-Up Report on Aug. 31 PILOTROCK OFFSHORE: Shareholders' Final Meeting Set for Aug. 17 SSO I LTD: Sole Member to Hear Wind-Up Report on Aug. 17 D O M I N I C A * DOMINICA: Economy and Debt Burden Both Grew in 2011 D O M I N I C A N R E P U B L I C MCC FINANCE: Moody's Rates US$150-Mil. Senior Secured Notes 'B2' E L S A L V A D O R BANCO HSBC: Fitch Affirms Viability Rating at 'BB' G U A T E M A L A GUATEMALA: Fitch Affirms 'BB+' Issuer Default Ratings U R U G U A Y * URUGUAY: Moody's Upgrades Sovereign Ratings From 'Ba1' X X X X X X X X * Upcoming Meetings, Conferences and Seminars - - - - - =============================== A N T I G U A & B A R B U D A =============================== LIAT: Names Ian Brunton As New Chief Executive Officer ------------------------------------------------------ Trinidad Express reports that former Chief Executive of State- owned Caribbean Airlines Ltd Captain Ian Brunton has been appointed Chief Executive Officer of its competitor Antigua-based Leeward Island Air Transport. LIAT disclosed that Mr. Brunton will head the airline, whose major shareholders are the governments of Barbados, Antigua & Barbuda and St Vincent & the Grenadines, according to Trinidad Express. The report notes that Mr. Brunton has over fifty years' experience as a pilot, starting his career in the Royal Air Force flying military jets, before moving to commercial airplanes at BWIA West Indies Airways. Mr. Brunton was appointed CAL's CEO in 2009 under the Arthur Lok Jack led board of directors, but was subsequently dismissed in 2010 following a "verbal disagreement" between then chairman George Nicholas III and CAL's line minister, then works and transport minister Jack Warner, the report notes. In a brief telephone interview with the news agency, Mr. Brunton said his new job would be a challenge, but he has always wanted to make a difference by helping the struggling airline achieve its full potential. As reported in the Troubled Company Reporter-Latin America on Jan. 3, 2012, Antigua Caribarena related that former Antigua Aviation Minister Robin Yearwood wants to see a merger between Leeward Islands Air Transport (LIAT) and the Trinidad and Tobago- owned Caribbean Airlines Limited, as he believes this is the only way the Antigua-based regional carrier can survive. Mr. Yearwood's call came against the background of media reports out of Port of Spain that suggested CAL's management may be eyeing expansion into the OECS territories, according to Antigua Caribarena. Headquartered in V. C. Bird International Airport in Saint George Parish, Antigua, Leeward Islands Air Transport, known as LIAT, operates high-frequency interisland scheduled services serving 22 destinations in the Caribbean. The airline's main base is VC Bird International Airport, Antigua and Barbuda, with bases at Grantley Adams International Airport, Barbados and Piarco International Airport, Trinidad and Tobago. ================= A R G E N T I N A ================= ALTERNATIVO SRL: Files for Bankruptcy ------------------------------------- Alternativo SRL filed for bankruptcy. The company defaulted its payments last Oct. 10, 2011. EMPRENDIMIENTOS INMOBILIARIOS: Asks for Bankruptcy Proceedings -------------------------------------------------------------- Emprendimientos Inmobiliarios Arenales SA asked for bankruptcy proceedings. INMANTEC SRL: Asks for Bankruptcy Proceedings --------------------------------------------- Inmantec SRL asked for bankruptcy proceedings. The company defaulted its payments last June 19. OSATO SA: Creditors' Proofs of Debt Due Aug. 30 ----------------------------------------------- Alejandra Viviana Paz, the court-appointed trustee for Osato SA's bankruptcy proceedings, will be verifying creditors' proofs of claim until Aug. 30, 2012. Ms. Paz will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 5 in Buenos Aires, with the assistance of Clerk No. 10, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. The Trustee can be reached at: Alejandra Viviana Paz Marcelo Torcuato de Alvear 1354 Argentina PLASTIC SAN: Applies for Bankruptcy Protection ---------------------------------------------- Plastic San SA applied for bankruptcy protection. The company defaulted payments last June 1. REEFER CONTROL: Creditors' Proofs of Debt Due Sept. 18 ------------------------------------------------------ Nelida Grunblatt de Nobile, the court-appointed trustee for Reefer Control Service SA's bankruptcy proceeding, will be verifying creditors' proofs of claim until Sept. 18, 2012. Ms. de Nobile will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 6 in Buenos Aires, with the assistance of Clerk No. 12, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. The Trustee can be reached at: Nelida Grunblatt de Nobile Felipe Vallese 1195 Argentina RENACITY INVESTMENT: Applies for Bankruptcy Protection ------------------------------------------------------ Renacity Investment SA (Sucursal argentina) applied for bankruptcy protection. The company defaulted its payments last March. SALON DORADO: Asks for Bankruptcy Proceedings --------------------------------------------- Salon Dorado SA asked for bankruptcy proceedings. The company defaulted its payments last Dec. 15, 2011. * BUENOS AIRES: Moody's Assigns 'B3' Rating to Series 2 Bonds ------------------------------------------------------------- Moody's Latin America has assigned ratings of B3 (global scale) and A3.ar (Argentina National Scale) to the Province of Buenos Aires' Series 2 of bonds to be issued under the 2012 Local Market Bonds Program for up to US$250 million. The Series 1 was issued in May 2012. The bonds to be issued under the Series 2 will be payable in Argentine pesos and sold in the local capital market. The assigned ratings are in line with the province's long term issuer ratings. Ratings Rationale The creation of the 2012 Local Market Bonds Program has been authorized by the provincial Decree 292/2012 and the Resolution 174/2012 of the province's Ministry of Economy, under the provisions of the 2012 Budget Law. The notes to be issued under the program constitute direct, general, unconditional, and unsubordinated obligations of the province, ranking at all times pari passu without any preference among themselves and will be backed by transfers from the Government of Argentina (B3, stable) under a tax-sharing agreement. The maximum authorized amount to be issued under the program is US$250 million, or its equivalent in other currency, which represents less than 2% of the province's net direct and indirect debt as of December 2011, and only 1% of total revenues budgeted for 2012. The province will offer a second tranche of US$50 million, with the possibility to increase the amount. These notes will be payable in Argentine pesos, pay interest at a fixed rate on a semi-annual basis, and amortize principal at maturity, which is scheduled to be in one year. "The assigned ratings reflect the economic uncertainty and cost pressures facing the province, reflected in structural fiscal imbalances and weaker financial performance since 2005", said Moody's analyst Patricio Esnaola. While Buenos Aires benefits from a diversified economy, which represents roughly 35% of national output, the ratings also take into account the financial dependence on the federal government, including the importance of federal transfers on the provinces' revenue stream as well as federal debt financing to help pay off debt maturities. This consideration links Buenos Aires' credit quality to that of the central government. "Due to the province's structural imbalances, Moody's expects that it will continue to borrow from both the local and/or international capital markets", said Esnaola. According to the 2012 fiscal year budget, the province has been authorized to contract debt in the amount of ARS7.85 billion (equivalent to approximately 13% of total debt as of December 2011), and other ARS5 billion are expected to come from the federal government. "Moody's will closely monitor the impact of potential debt increases in the province's credit profile", Esnaola said. What Could Change the Rating Up/Down A strengthening of the province's financial performance, based on the translation of economic recovery and revenue growth into balanced financial operations could apply upward pressure on the ratings. Significant weakening of the province's financial performance and/or the national government's inability or unwillingness to continue to provide ongoing financial support and refinance the province's debt could apply downward pressure on the ratings. =========== B R A Z I L =========== BANCO BARCLAYS: Moody's Assigns 'D' BFSR; Outlook Stable -------------------------------------------------------- Moody's Investors Service assigned a standalone bank financial strength rating of D to Banco Barclays S.A. (Barclays Brazil), the wholly-owned subsidiary of UK Barclays Bank Plc (A2, negative, C- /baa2 negative). At the same time, Moody's assigned long- and short-term global local and foreign-currency deposit ratings of Baa3 and Prime-3, respectively, as well as long- and short-term national scale ratings of Aa1.br and BR-1 to Barclays Brazil. The outlook on all ratings is stable. The following ratings were assigned to Banco Barclays S.A.: Bank Financial Strength Rating: D, stable outlook Long-term global local-currency deposits: Baa3 , stable outlook Short-term global local-currency deposits: Prime-3 Long-term foreign currency deposits: Baa3, stable outlook Short-term foreign currency deposits: Prime-3 Long-term Brazilian national scale: Aa1.br Short-term Brazilian national scale: BR-1 Ratings Rationale Moody's notes that Barclays Brazil' standalone bank financial strength rating, which maps to ba2 in the long-term scale, reflects its relatively small and still developing investment banking franchise, as indicated by the overall modest earnings and market share in its targeted products. The Brazilian operation, which evolved from a wholesale lending franchise back in 2000, is focused on the rates business, and particularly on foreign exchange, fixed income and derivative transactions, as well as investment banking activities, as it leverages the group's global markets strategy. The standalone rating also incorporates Barclays Brazil's highly liquid balance sheet, and its solid capital base, which supports management's business growth plans. Currently, the subsidiary relies on the group for a large part of its funding, but management intends to expand and diversify its sources locally, as operations grow. Moody's also notes that earnings, are still primarily derived from proprietary trading , foreign exchange and derivatives, and therefore, they tend to be volatile, despite the local bank's limited market risk appetite. A growing share of fee- based revenues from brokerage activities and client business is likely to result in more balanced contribution from the various business lines over time. Moody's acknowledges the growth and earnings potential offered by the Brazilian investment bank market, which supports Barclays' ambitions of achieving a more relevant local market share over the next two years. Nonetheless, the bank faces growing competition by other global banks present in Brazil, as well as large domestic institutions, which may pose pressures on earnings generation. Since 2010, the bank has been seeking to increase its business with local clients - particularly in the areas of corporate finance, capital markets, and brokerage activities -- at the same time that it continues to emphasize its products and services to Barclays' global customer relationships interested in investing in Brazil, a strategy that is likely to enhance earnings recurrence in the local balance sheet. The rating also acknowledges that the Brazilian bank follows strict risk management and control guidelines that are aligned to the parent's, and which ensure that potential losses are contained and minimized, particularly in its treasury and brokerage positions. The Brazilian operation has a relatively low risk profile, with a significant portion of risks being transferred to other offshore books of the group. Moody's Baa3 global local currency rating is two notches above the standalone credit assessment and incorporates Moody's assessment of a high probability of support from the bank's parent company in light of its long-term commitment to the Brazilian operations, as indicated by significant liquidity and funding support that is provided to Banco Barclays. Moody's ascribes no degree of systemic support to Banco Barclays, considering its limited footprint in the Brazilian deposit industry. The supported rating considers the parent Barclays Bank Plc's standalone rating of C-/baa2, with negative outlook. Based in Sao Paulo, Banco Barclays S.A. had total assets of R$5.97 billion (US$3.3 billion) and equity of R$736.2 billion (US$ 404.5 million) as of March 31, 2012. HYPERMARCAS SA: S&P Affirms 'BB-' Issuer Credit Ratings ------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Hypermarcas S.A. to stable from negative. "At the same time, we affirmed our 'BB-' ratings on the company," S&P said. "The outlook change reflects our expectation that Hypermarcas will continue improving its operating and financial performance in the coming years, following several quarters of poor cash generation and weak credit metrics in 2011. It also reflects a change in our assessment of the company's liquidity to 'strong' due to our expectation that it will maintain significant cash reserves, which mitigates the still high gross leverage metrics for its rating Category," S&P said. RAIZEN ENERGIA: S&P Ups Ratings on Cosan Notes From 'BB' -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BBB' global scale and 'brAAA' national scale ratings, including the corporate credit ratings, to Raizen Energia S.A. and Ra¡zen Combust¡veis S.A., jointly referred to as Ra¡zen. "At the same time, we raised the issue ratings on the notes that Cosan Finance Ltd. and CCL Finance Ltd. originally issued to 'BBB' from 'BB'. The upgrade reflects our view of the combined credit quality of Ra¡zen and in line with the ratings on senior unsecured debts of the entities that form Ra¡zen. We also removed these issue ratings from CreditWatch positive, where we placed them on Feb. 1, 2010, following the announcement of the creation of the joint venture," S&P said. =========================== C A Y M A N I S L A N D S =========================== BIO/PHARMACCELERATOR: Shareholders' Final Meeting Set for Aug. 27 ----------------------------------------------------------------- The shareholders of Bio/Pharmaccelerator Partners Ltd. will hold their final meeting on Aug. 27, 2012, at 11:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Jonathan Nicholson P.O. Box 1976 Grand Cayman KY1-1104 Cayman Islands BUNYAN 2 FINANCE: Shareholders' Final Meeting Set for Aug. 17 ------------------------------------------------------------- The shareholders of Bunyan 2 Finance Co. will hold their final meeting on Aug. 17, 2012, at 12:30 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Shaikh Abdul Rahiman Gulf Investment House K.S.C. Dar Al-Awadi Towers, 27th to 30th Floors Ahmad Al-Jaber Street, Sharq PO Box 28808, Safat 13149 Kuwait Telephone: (+965) 1844488 Ext-1402 CT OPPORTUNITY: Shareholder to Hear Wind-Up Report on Aug. 13 ------------------------------------------------------------- The shareholder of CT Opportunity Investment Company will receive on Aug. 13, 2012, at 10:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Cheng Tai-Keh 8th Floor, No. 3 Sung Shou Road, Taipei 110 Taiwan Telephone: +8862-8780-8867 Facsimile: +8862-8780-2876 GEMINI CAYMAN: Shareholders' Final Meeting Set for Aug. 17 ---------------------------------------------------------- The shareholders of Gemini Cayman Limited will hold their final meeting on Aug. 17, 2012, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers SPV Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 GREENLAKE INVESTMENT: Shareholders' Final Meeting Set for Aug. 17 ----------------------------------------------------------------- The shareholders of Greenlake Investment Management Ltd will hold their final meeting on Aug. 17, 2012, at 11:15 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 INJET400 AIRCRAFT: Shareholders' Final Meeting Set for Aug. 17 -------------------------------------------------------------- The shareholders of Injet400 Aircraft Leasing Co Limited will hold their final meeting on Aug. 17, 2012, at 10:45 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 INJET800 AIRCRAFT: Shareholders' Final Meeting Set for Aug. 17 -------------------------------------------------------------- The shareholders of Injet800 Aircraft Leasing Co Limited will hold their final meeting on Aug. 17, 2012, at 11:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 K SERA SERA: Sole Member to Hear Wind-Up Report on Aug. 31 ---------------------------------------------------------- The sole member of K Sera Sera Investments Limited will receive on Aug. 31, 2012, at 10:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Lion International Management Limited Craigmuir Chambers P.O. Box 71 Road Town, Tortola VG1110 British Virgin Islands PILOTROCK OFFSHORE: Shareholders' Final Meeting Set for Aug. 17 --------------------------------------------------------------- The shareholders of Pilotrock Offshore Fund, Ltd. will hold their final meeting on Aug. 17, 2012, at 11:45 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 SSO I LTD: Sole Member to Hear Wind-Up Report on Aug. 17 -------------------------------------------------------- The sole member of SSO I Ltd will receive on Aug. 17, 2012, at 11:30 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 =============== D O M I N I C A =============== * DOMINICA: Economy and Debt Burden Both Grew in 2011 ----------------------------------------------------- Caribbean360.com reports that while the Dominica economy appears to be on a moderate recovery path, government is still facing challenges in reigning in the country's debt burden. This was revealed by Prime Minister Roosevelt Skerrit in Parliament as he delivered the national budget on July 17, according to Caribbean360.com. The report notes that Prime Minister Skerrit said that the economy is estimated to have grown by 1.9% in 2011, and projected to grow by 2.0% in 2012, but to drop back to 1.8% in 2013. Caribbean360.com says that Prime Minister Skerrit reported to parliament that the improvement in performance was due mainly to growth in the agriculture, construction and tourism sectors. Additionally, the prime minister reported a significant increase in the tourism sector, Prime Minister Skerrit said, Caribbean360.com notes. However, Caribbean360.com notes that the total number of visitor arrivals up to December 2011 is estimated to have decreased by 1.2%. The report relates that there was also a decrease in the number of cruise calls and passengers "as a direct result of the global crisis". Despite this, the tourism sector is expected to grow by 1.9% in 2012, Caribbean360.com notes. However, Caribbean360.com says that Prime Minister Skerrit also revealed that Dominica's total disbursed outstanding debt at the end of the financial year 2011/12 amounted to EC$896.3 million. Caribbean360.com notes that Prime Minister Skerrit said that that figure was 3.4% more than the previous year, when the debt stood at EC$866.2 million. Caribbean360.com discloses that the 2011/2012 figure's said to consist of external debt "of which EC$541.9 million is held by central government and $109.6 million is debt guaranteed for public corporations". According to the prime minister, domestic debt for the same period was EC$202.2 million for central government, and debt guaranteed for public corporations was $42.6 million, the report relays. The report relates that the prime minister said the increase in total disbursed outstanding debt is as a result of disbursements "on new and existing commitments". The government said during the financial year it contracted five external loans amounting to EC$75.9 million from the Caribbean Development Bank (CDB), the International Monetary Fund (IMF), and Agence Fran‡aise de Developement (AFD), the report notes. "The loans from CDB and IMF were contracted to repair damages caused by the Layou floods and Tropical Storm Ophelia, while the loan from AFD was contracted for the completion of the Roseau to Melville Hall Road project," the report quoted Mr. Skerrit as saying. He also indicated that in December 2011 "a loan of EC$20 million was obtained to provide bridging finance, particularly for project implementation," the report notes. Parliament's been told that a three year medium term debt management strategy for the period 2010/11 to 2013/14 was developed to guide the management of government's debt, the report adds. =================================== D O M I N I C A N R E P U B L I C =================================== MCC FINANCE: Moody's Rates US$150-Mil. Senior Secured Notes 'B2' ---------------------------------------------------------------- Moody's Investors Service assigned a B2 rating to MCC Finance Company Limited's proposed US$150 million senior secured notes, with an expected maturity of 2019 and a legal final maturity of 2022. MCC Finance Company Limited is a wholly-owned subsidiary of real estate developer Metro Country Club. This is the first time Moody's has rated Metro Country Club. The outlook is stable. The following rating was assigned with a stable outlook: MCC Finance Company Limited - Proposed senior secured notes at B2 Ratings Rationale Metro Country Club is a real estate developer located in Juan Dolio, San Pedro de Macor¡s, Dominican Republic focused mainly on the development, construction and sale of real estate as well as the purchase and sale of land. The company has been in existence for almost 20 years, generating a stable revenue stream from the sale of land (lots), apartments and villas as well as, to a lesser extent, fees from its golf course and beach club. The notes will be secured by a first priority security interest from MCC Finance Company Limited, Operadora de Golf, S.A. (manager of the developments) and Metro Country Club's subsidiary guarantors of their respective rights in all real property and improvements (excluding the assets pledged under the Villas Loan). In addition, the notes are secured by a pledge of the receivables, rights and interests under the agreements related to the sale of real property, a pledge of all the shares of Metro Country Club and its subsidiaries, insurance proceeds and all other revenue arising from the operation of developments including golf courses, marinas, tennis courts and beach clubs. While the notes have a legal final maturity of 2022, Metro Country Club has an expected maturity of 2019. In addition, the company has a redemption option in years four, five and six. The notes are senior secured obligations of Metro Country Club and will rank senior, to the extent of the collateral, in right of payment to their existing and future senior indebtedness. The notes contain certain covenants which include restricted payments, the incurrence of debt and a debt service coverage ratio minimum of 1.15x, which would trigger an early amortization period. There are additional limits related to the distribution of funds to Metro Country Club as a dividend that limit the debt service coverage ratio to 1.40x. The interest and principal payments on the notes will not be hedged. This creates foreign currency risk, which is somewhat mitigated by Metro Country Club's collection of approximately 75% of sales in US dollars. Also, recent history supports a stable Dominican currency. However, any substantial currency movements that would stress Metro Country Club's ability to pay the bonds' debt service will place negative pressure on the rating. Proceeds from the transaction will be used to finance part of the construction for the third phase of several developments, which include the acquisition of land and construction costs associated with the Costa Blanca project as well as the acquisition of land for the Metro Country Club Expansion project, which consists of residential lot sales. The company will also use part of the proceeds from the sale of the notes to refinance existing debt. Moody's B2 rating accounts for Metro Country Club's proforma credit metrics, which are in-line with other B-rated companies, as well as its mix of real estate products, and the location, price point and amenities of the development, which differentiate it from other developments in the area. Metro Country Club's other projects have sold well and on schedule, and the company has a strong pipeline of pre-sales on existing developments. These positive factors are counterbalanced by the narrow market in which the company operates, as well as the speculative nature of its construction -- Metro Country Club bears the risk of finding buyers and not all units are pre-sold. This is somewhat mitigated by the company's 20-year operating history, with an experienced management, sales and marketing teams and a track record of condo sales. Furthermore, the success of the project could be affected by current and future economic and political conditions in the Dominican Republic. Positive ratings movement would be difficult in the medium term but would reflect strong presales and collections at the Costa Blanca project as in the other Metro projects, with sales prices at least meeting projections, if not exceeding projections by 10%. Furthermore, it assumes no economic difficulties or natural disasters which would prevent the company from meeting projections. Negative ratings movement would reflect economic difficulties in the Dominican Republic, a natural disaster or other event that delays or damages the development, or sales demand for Metro Country Club's housing and related property being close to or less than 20% of what was anticipated. In addition, defaults by buyers greater than 5% at closing for the company's Las Olas, Marbella or Costa Blanca projects would place negative ratings pressure. MCC Finance Company Limited's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside MCC Finance Company Limited's core industry and believes MCC Finance Company Limited's ratings are comparable to those of other issuers with similar credit risk. ===================== E L S A L V A D O R ===================== BANCO HSBC: Fitch Affirms Viability Rating at 'BB' -------------------------------------------------- Fitch Ratings has revised to Negative from Stable the Rating Outlook of Banco Agricola's (Agricola) long-term Issuer Default Rating (IDR). This action follows Fitch's revision of El Salvador's sovereign rating Outlook to Negative from Stable. In turn, HSBC Salvadoreno's IDRs and National Ratings remain on Rating Watch Negative, pending the completion of the sale agreement between HSBC Holdings and Banco Davivienda (Davivienda), which is expected to take place this year. Agricola's and HSBC Salvadoreno's IDRs are two notches above the sovereign rating and at the same level of El Salvador's country ceiling. An eventual downgrade of El Salvador's sovereign rating could result in a downgrade of the country ceiling, which would, in turn, lead to a downgrade of Agricola's IDRs, accordingly. On the other hand, if the sovereign ratings are eventually affirmed at 'BB' and the Outlook is revised to Stable from Negative, it is highly likely that Agricola's IDR would also be affirmed with a Stable Outlook. Agricola's Viability Rating (VR), currently at 'bbb-' could also be downgraded in the event of a reduction in the country ceiling, reflecting the increased risks of a deteriorated operating environment. Agricola's IDRs are underpinned by the bank's sound financial condition, reflected in its strong local franchise, sound performance, robust capitalization, good asset quality, ample depositary base, and strong loss-absorption capacity. Agricola's ratings also consider the bank's proven resilience to downturns in economic cycles and its dominant position in the local market. However, the bank's ratings factor in El Salvador's challenging economic conditions, which may still have some impact on the asset quality and growth prospects. On the other hand, the downside potential on Agricola's IDRs is limited to one notch given the moderate probability of support that it would receive from Bancolombia ('BBB'), should it be required, which is reflected on Agricola's support rating of '3'. Fitch believes that Agricola's national ratings would not be affected should El Salvador's sovereign and country ceiling be downgraded. HSBC Salvadoreno's IDRs were placed on Rating Watch Negative on Jan. 27, 2012, after the announcement of HSBC's agreement to sell its operations in El Salvador, Honduras, and Costa Rica to Banco Davivienda of Colombia. The Rating Watch indicates that there is a heightened probability of a potential downgrade of HSBC Salvadoreno's ratings once the transaction is completed. Fitch's base case scenario considers that the Rating Watch Negative will be resolved before any further rating action on El Salvador's sovereign rating takes place. However, in the event that this transaction is not completed, the Rating Watch Negative would be replaced by a Negative Outlook, in line with that of the sovereign. If Fitch downgrades El Salvador's sovereign rating before the acquisition is completed, HSBC Salvadoreno's IDRs are also likely to be downgraded similar to those of Agricola. In any scenario, HSBC Salvadoreno's VR is expected to remain at its current level given the bank's financial profile. Established in 1955, Agricola is the largest and most diversified bank in El Salvador and one of the major players in Central America. In May 2007, Bancolombia completed de acquisition of Agricola. At present, Bancolombia, directly or indirectly, owns around 99% of Agricola's shares. As of March 2012, Agricola's market share in terms of assets and deposits was 28.4% and 27%, respectively. HSBC Salvadoreno is the fourth largest bank in El Salvador in terms of assets, with a market share of 14.1% as of March 2012. The bank has a well-balanced loan portfolio and a nationwide network of 344 points of service. HSBC Salvadoreno consolidates two financial services subsidiaries in El Salvador. HSBCS is part of a local financial group consolidated under Inversiones Financieras HSBC, S.A. (IFHSBC), where it accounts for the majority of consolidated assets and earnings. Fitch has affirmed the following ratings: Banco Agricola: -- Long-term IDR at 'BBB-'; Outlook revised to Negative from Stable; -- Viability rating at 'bbb-'; -- Short-term IDR at 'F3'; -- Support at '3'; -- National-scale long-term rating at 'AAA(slv)'; Outlook Stable; -- National-scale short-term rating at 'F1+(slv)'; -- National-scale rating for local issues of senior unsecured debt at 'AAA(slv)'; -- National-scale rating for local issues of senior secured debt at 'AAA(slv)'. Inversiones Financieras Banco Agricola -- National-scale long-term rating at 'AAA(slv)'; Outlook Stable; -- National-scale short-term rating at 'F1+(slv)'. Banco HSBC Salvadoreno: -- Viability Rating at 'bb'. The following ratings remain on Rating Watch Negative Banco HSBC Salvadoreno: -- Long-term IDR 'BBB-'; -- Short-term IDR 'F2'; -- Support '2'; -- Long-term National Rating 'AAA(slv)'; -- Short-term National Rating 'F1+(slv)'; -- Senior Unsecured Debt Long-term Rating 'AAA(slv)'; -- Senior Secured Debt Long-term Rating 'AAA(slv)'; -- Senior Unsecured Debt Short-term Rating 'F1+(slv)'; -- Senior Secured Debt Short-term Rating 'F1+(slv)'. Inversiones Financieras HSBC: -- Long-term National Rating 'AAA(slv)'; -- Short-term National Rating 'F1+(slv)'. ================= G U A T E M A L A ================= GUATEMALA: Fitch Affirms 'BB+' Issuer Default Ratings ----------------------------------------------------- Fitch Ratings has affirmed the Issuer Default Ratings (IDRs) and Country Ceiling for Guatemala as follows: -- Foreign currency IDR at 'BB+'; -- Local currency IDR at 'BB+'; -- Foreign currency short-term IDR at 'B'; -- Country ceiling at 'BBB-'. The Rating Outlook remains Stable. Guatemala's 'BB+' ratings are supported by the country's sustained macroeconomic stability, solid debt repayment record and its lower public and external debt burdens relative to those of 'BB'-rated peers. However, creditworthiness is constrained by structural factors such as weak social development and governance indicators, high crime and inequality and low savings and investment rates that constrain long term potential growth. Fiscal rigidity and a low revenue base limit the sovereign's ability to address the structural shortcomings. Growth has been resilient but slow through the global financial crisis. Protracted sluggish growth in the U.S., Guatemala's main trading partner and the origin of 90% of remittances, will likely cap average growth in Guatemala to 3.3% between 2012 and 2014 but keep inflation stable at an average 5% over the period. Downside risks stem from a renewed weakness in the U.S. and an escalation of the eurozone debt crisis. President Perez Molina's administration early success in passing a tax reform that is expected to yield 1.5% of GDP by 2015 would facilitate fiscal consolidation. However, due to fiscal rigidities and a still low revenue base, the tax reform may prove insufficient to address structural issues facing the economy. Tax revenues estimates for 2015, incorporating the reform, are 12.6% of GDP, well below the 'BB' median of 30.5%. In this context, expanding the government revenue base and making fiscal management more flexible will remain among Guatemala's key credit challenges. Guatemala's government debt burden of 24.3% of GDP is low relative to the 'BB' median of 40% of GDP as a result of a track record of conservative fiscal management. Fitch expects public debt to stabilize below 26% of GDP as the fiscal deficit drops to negative 1.9% of GDP in 2014 from negative 3.3% of GDP in 2010. Guatemala's financing needs remain modest at 3.2% of GDP and lower than its peers. In addition, the sovereign's ample access to multilateral financing and the recent successful placement of USD700million in the international capital markets support financing flexibility. President Perez Molina's administration intends to address the country's structural shortcomings in a comprehensive way aided by a battery of legislative reforms. The credit's structural weaknesses weigh on the country's investment and growth dynamics. Reform efforts will possibly be limited due to the highly divided Congress, fluid political affiliation and cumbersome legislative rules. In addition, low fiscal flexibility will test the president's ability in fully implementing his campaign agenda. Nonetheless, Fitch believes that broad political and macroeconomic stability will be preserved over the next two years. External solvency and liquidity indicators are credit strengths. Low public and external debt burdens, a favorable debt profile and an adequate level of international reserves translate in a strong external liquidity ratio relative to peers. Moreover, big structural trade deficits tend to be offset by family remittances, which results in a stable foreign exchange market. Guatemala's credit ratings could be negatively affected by its continued macroeconomic under-performance compared with its rating peers. Lack of progress in key structural areas that hinder private investments and growth prospects will place downward pressure on the rating. On the other hand, implementation of reforms that strengthen public finances and growth prospects and help arrest the relative decline of its economic standing would be consistent with maintaining ratings at current levels. Significant progress in addressing structural weaknesses will be critical for achieving an upgrade. ============= U R U G U A Y ============= * URUGUAY: Moody's Upgrades Sovereign Ratings From 'Ba1' -------------------------------------------------------- Moody's Investors Service has upgraded to Baa3 from Ba1 the government of Uruguay local- and foreign-currency bond ratings. The outlook remains positive. Key drivers of the rating action include: 1. A sovereign credit profile that, in general terms, has come in line with that of Baa-rated investment-grade countries; 2. Steady improvement in Uruguay's fiscal metrics coupled with a significant strengthening of the government's balance sheet; 3. Reduced credit vulnerabilities to regional shocks in light of increased diversification and ample liquidity buffers. Ratings Rationale Uruguay's income level is above the median for the Baa peer group. The economy's performance has been characterized by robust growth over an extended period of time with GDP reporting average annual growth of more than 6% during 2004-2011. Uruguay's economic fundamentals have strengthened and potential growth has increased underpinned by an upward shift in total factor productivity. As a result, the economy is capable of reporting higher growth rates on a sustained basis, a condition that benefits Uruguay relative to peers. Fiscal metrics have shown steady improvement reporting gradual convergence with Baa medians. The government accounts reflect a strong commitment to fiscal responsibility and strict compliance with targets set in the multi-year budget framework. Since 2004, government deficits have been on the order of 1% to 2% of GDP, with primary balances exceeding 1% of GDP. The central government's debt ratio has moved below 40% of GDP after reaching nearly 80% in 2004. Moody's anticipates that positive trends will persist, leading to additional reductions in government debt indicators in the coming years. The credit resiliency of the government's balance sheet is strongly supported by a debt structure that incorporates a maturity profile exceeding that of most Baa-rated countries - average debt maturity stands at some 11 years. The government faces moderate refinancing risks: gross financing needs are among the lowest for all sovereigns rated by Moody's coming to 3% of GDP annually. A strong institutional feature of Uruguay is its conservative fiscal management. An attitude of extreme risk aversion on the part of the authorities has led to a substantial build up of financial buffers that make the government capable of handling adverse shocks, including those associated with severe stress scenarios. A high level of precautionary liquidity reserves -- equivalent to 6% of GDP -- combined and contingent credit lines with multilateral banks provide ample coverage against events that could restrict government access to markets, placing Uruguay in a stronger position when compared to similarly rated countries. While potential credit risks derived from the country's character as a small open economy and its commodity dependence are lower than before, vulnerabilities continue to be present. Moody's recognizes that the country's exposure to some of its less-stable neighbors has been reduced and that diversification of its export base mitigates concentration risks. Still, regional contagion remains an important challenge for policy makers and fluctuations in commodity markets pose non-negligible risks. Moody's indicated that credit vulnerabilities derived from the government's exposure to foreign currency-denominated debt are mitigated in part by asset holdings that reduce the potential impact of exchange rate shocks on the sovereign's balance sheet. Additionally, liability management operations have been effective in lowering the share of foreign-currency debt with two transactions carried during the last eight months moving it to the 50% mark. While credit risks related to the level of debt dollarization are already captured by both the current rating and the positive outlook, Moody's indicated that dollarization will likely constrain the potential upside for Uruguay's ratings over the medium term. WHAT COULD MOVE THE RATING UP/DOWN? While no single condition would be sufficient to modify Uruguay's sovereign rating, elements that will be monitored on an ongoing basis to determine if the positive outlook can eventually lead to higher ratings include: * The economy's ability to avoid sharp growth deceleration in an environment that will be characterized by less favorable economic and financial external conditions during the next 12-18 months, the time period associated with the current outlook horizon; A fiscal performance associated - at most - with modest deviations on the government accounts with respect to targets set in the medium-term budget framework; * Evidence of continued diversification in Uruguay's export base that contributes to reduce further concentration risks. Even though a downgrade is unlikely given the positive rating outlook, elements that could trigger negative rating actions include: * A reversal of the declining trend in foreign currency- denominated debt that takes the corresponding share above the 50% mark; * Growing macroeconomic imbalances (i.e., current account deficit, inflation, etc.) associated to persistent above-trend growth; * Deterioration of the underlying (structural) fiscal balance As part of the rating action, Uruguay's country ceiling for foreign-currency deposits was upgraded to Baa3 from Ba2 in line with Moody's practice of aligning foreign-currency deposit ceilings with government ratings for investment grade countries -- the country ceiling foreign-currency bonds remains at Baa1. The local currency country ceilings for both bond and deposits were downgraded to Baa1 from A3 to reflect a relatively high degree of correlation between foreign-currency and local-currency ratings, given a highly dollarized financial system. Additionally, the short-term foreign-currency country ceiling for deposits was changed to P3 from NP, and the foreign-currency country ceiling for bonds to P2 from P1. The last rating action on the government of Uruguay was implemented on January 26, 2012 when Moody's assigned a positive outlook to Uruguay's sovereign ratings. The principal methodology used in this rating was Moody's Sovereign Bond Methodology published in 2008. =============== X X X X X X X X =============== * Upcoming Meetings, Conferences and Seminars --------------------------------------------- Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800 http://www.abiworld.org/ November 1-3, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Westin Copley Place, Boston, Mass. Contact: http://www.turnaround.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800 http://www.abiworld.org/ April 10-12, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott Chicago, Chicago, Ill. Contact: http://www.turnaround.org/ October 3-5, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Wardman Park, Washington, D.C. Contact: http://www.turnaround.org/ *********** Monday's edition of the TCR-LA delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-LA editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-LA constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-LA editor holds some position in the issuers' public debt and equity securities about which we report. Tuesday's edition of the TCR-LA features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR-LA. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com *********** 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, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Valerie U. Pascual, Ivy B. Magdadaro, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2012. 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 US$625 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 US$25 each. For subscription information, contact Peter Chapman at 240/629-3300. * * * End of Transmission * * *