TCRLA_Public/140206.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, February 6, 2014, Vol. 15, No. 26


                            Headlines



B E R M U D A

VIMPELCOM LTD: Taps Aleksandr Vorobyev as Acting Director General
VIMPELCOM LTD: Fin'l. Policy Updates Credit Positive says Moody's


B R A Z I L

CENTRAIS ELETRICAS: Moody's Withdraws 'Caa1' Issuer Rating
CIA DE SANEAMENTO: Will Cut Bills for Customers Who Save Water
* BRAZIL: Treasury Cancels Bond Auctions Citing Market Conditions


C A Y M A N  I S L A N D S

AVILA FUND: Commences Liquidation Proceedings
CABA LIMITED: Placed Under Voluntary Wind-Up
CANADIAN SHIELD: Shareholders Receive Wind-Up Report
DRAGONSPELL HOLDINGS: Commences Liquidation Proceedings
FCM REINSURANCE: Commences Liquidation Proceedings

HELIUM MASTER: Commences Liquidation Proceedings
IVIRON FUND: Placed Under Voluntary Wind-Up
LAIDA LIMITED: Shareholders Receive Wind-Up Report
MCT CAPITAL: Placed Under Voluntary Wind-Up
PCM SPC: Shareholders Receive Wind-Up Report

PYTHIA LIMITED: Shareholder Receives Wind-Up Report
RAM CAPITAL: Placed Under Voluntary Wind-Up
REDBREAST AIRCRAFT: Shareholders Receive Wind-Up Report
RHONE-SAM: Placed Under Voluntary Wind-Up
RITCHIE DEBT: Placed Under Voluntary Wind-Up

RITCHIE RML: Placed Under Voluntary Wind-Up
SL PREMIUM: Placed Under Voluntary Wind-Up
SPECIAL CREDIT: Placed Under Voluntary Wind-Up
TUTOR INTERNATIONAL: Shareholder Receives Wind-Up Report
VENCAP 7 LLC: Commences Liquidation Proceedings


D O M I N I C A N   R E P U B L I C

* DOMINICAN REP: Gas Stations Complain of Sagging Sales


P A N A M A

BANCO PANAMENO: S&P Affirms 'BB' ICR; Outlook Stable
GROUP UNITED: Panama Canal Expansion on 'Brink of Failure'


P A R A G U A Y

PARAGUAY: Moody's Ups Gov't. Bond Rating to Ba2; Outlook Positive


P U E R T O   R I C O

GOVERNMENT DEV'T BANK: S&P Lowers LT Issuer Credit Rating to 'BB'
PUERTO RICO: GO Bonds Inch Higher After S&P Downgrade
PUERTO RICO: Investors Appears to Shrug Off Debt Downgrade
PUERTO RICO: S&P Cuts Debt to Junk, Cash Squeeze Intensifies
PUERTO RICO AQUEDUCT: S&P Lowers Revenue Bonds Rating to 'BB+'

UNIV. OF PUERTO RICO: S&P Lowers SPUR to 'BB+' on Revenue Bonds


                            - - - - -


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B E R M U D A
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VIMPELCOM LTD: Taps Aleksandr Vorobyev as Acting Director General
-----------------------------------------------------------------
UzDaily News reports that telecommunication operator Vimpelcom Ltd
(Beeline trademark) appointed Aleksandr Vorobyev as acting
director of its subsidiary in Uzbekistan, Unitel LLC.

Prior to appointment, Mr. Vorobyev worked as financial director of
the operator, according to UzDaily News.

Former director-general of Unitel Andrei Safronyuk, who worked in
the position since June 2010, left the post as his contract
expired, the report notes.  Mr. Safronyuk will continue his career
outside of Vimpelcom, the report relays.

Aleksandr Vorobyev worked as financial director at Takom,
Vimpelcom's subsidiary in Tajikistan, between November 2011 and
August 2013.  In August 2013, he started to work as financial
director of Unitel.

Domiciled in Bermuda and headquartered in the Netherlands,
VimpelCom Ltd is a holding company for Vimpel-Communications OJSC
(Ba3 stable), Kyivstar (unrated), Wind Telecomunicazioni S.p.A.
(B1 negative), and Global Telecom Holding S.A.E. (unrated), with
strong positions in Russia, Ukraine, Kazakhstan, Italy, Algeria,
Pakistan, and operations in countries in the Commonwealth of
Independent States (CIS), Africa, South-East Asia and North
America.


VIMPELCOM LTD: Fin'l. Policy Updates Credit Positive says Moody's
-----------------------------------------------------------------
Moody's Investors Service has said that it views recent updates
VimpelCom Ltd (Ba3 stable) has made to its financial policy as
credit positive for the group. The updated policy prioritises
deleveraging and investment in 3G/4G mobile data network over
dividend payouts. The new policy should support the group's
financial metrics and competitive positions. However, any positive
pressure on the rating will depend on the development of the
group's financial metrics as a result of both the implementation
of its new financial policy and its operating performance.

On January 28, VimpelCom announced that it intends to (1) limit
its dividend payouts to $0.035 from $0.8 per share until it
deleverages to reported net debt/EBITDA of below 2.0x, and (2)
focus on deleveraging and investment in the expansion of its 3G/4G
mobile data network, with capital expenditure (capex) accounting
for 21% of the group's revenue in 2014.

The announced policy, in and of itself, does not translate into
immediate positive pressure on VimpelCom's rating. The impact on
the rating will depend on the evolution of the group's financial
metrics as a result of the implementation of the updated financial
policy. As yet, VimpelCom has not disclosed details of whether it
plans to use the cash saved on dividends for either debt reduction
or financing capex, and which entities within the group will be
affected.

Moody's notes that VimpelCom's Ba3 corporate family rating (CFR)
continues to reflect the company's ongoing reliance upon its
Russian and Ukrainian subsidiaries consolidated under VimpelCom
Holdings B.V., which continue to determine VimpelCom's financial
flexibility. As such, Moody's primarily bases its assessment of
VimpelCom's business and financial profile on VimpelCom Holdings.

Moody's estimates that as of year-end 2013 VimpelCom Holdings'
leverage stood at around 2.4x adjusted debt/EBITDA, materially
exceeding 2.0x, which is the threshold for an upgrade of
VimpelCom's Ba3 CFR. Should VimpelCom apply all cash saved on
dividends in 2014 to repay debt consolidated at the VimpelCom
Holdings' level (as opposed to repaying debt at VimpelCom's highly
leveraged business in Italy consolidated under Wind Telecom
S.p.A.), the company's leverage would not necessarily decline
below 2.0x. This is because deleveraging will also depend on the
company's ability to preserve its historically strong operating
performance in the highly competitive core Russian market, which
is yet to be evidenced.

The rating agency recognises the long-term positive effect of
VimpelCom's investment in the expansion of its 3G/4G networks, as
operations in the lucrative mobile data segment are likely to be
the main driver for the group's revenues growth in the medium
term. The scale and quality of those networks are likely to be one
of the key factors for the group in maintaining its extensive
subscriber base, particularly in Russia. However, it will take
time for increased investment in the 3G/4G networks to translate
into meaningful revenues and earnings growth.

Domiciled in Bermuda and headquartered in the Netherlands,
VimpelCom Ltd is a holding company for Vimpel-Communications OJSC
(Ba3 stable), Kyivstar (unrated), Wind Telecomunicazioni S.p.A.
(B1 negative), and Global Telecom Holding S.A.E. (unrated), with
strong positions in Russia, Ukraine, Kazakhstan, Italy, Algeria,
Pakistan, and operations in countries in the Commonwealth of
Independent States (CIS), Africa, South-East Asia and North
America.


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


CENTRAIS ELETRICAS: Moody's Withdraws 'Caa1' Issuer Rating
----------------------------------------------------------
Moody's Investors Service is withdrawing all Centrais Eletricas do
Para's (CELPA) ratings for its own business reasons.

Moody's last rating action on CELPA was on December 23, 2013 when
Moody's upgraded Celpa's Issuer rating to Caa1 on the global scale
from Ca and to Caa1.br on the Brazilian National Scale from Ca.br
with a stable outlook. At the same time, Moody's upgraded the
rating on CELPA's former senior unsecured 5-year USD 250 million
bond issue to Caa1 on the global scale from Ca.

The following ratings were withdrawn:

Issuer Ratings: Caa1/Caa1.br

Senior Unsecured rating of Caa1 on 10.5% 5 year USD 250 million
bonds due June 3, 2016

Ratings Rationale

CELPA has been in judicial recovery since February 28, 2012. The
main points approved on CELPA's financial recovery plan on
September 01, 2012 included the following: a BRL 700 million
equity infusion by new owner Equatorial Energia S.A. (not rated);
a transition and restructuring plan approved by ANEEL; a
reschedule of taxes due over a minimum term of term of 60 months;
and a renegotiation and rescheduling of its debt. All of these
items have been implemented; however, Equatorial Energia still
needs to infuse its remaining BRL 250 million in new equity which
will be used to finance part of the capital expenditure program.
Despite its ownership by a financially strong and experienced
shareholder and the above credit positives, CELPA's future is
still viewed as challenging given his still highly levered capital
structure the material investments that will be required to
achieve ANEEL's energy loss target of 28.5% given the 36.5% energy
losses registered at the end of the recent third quarter. Moody's
Investors Service has withdrawn the credit rating for its own
business reasons.

CELPA, headquartered in Belem, owns a 30-year concession contract
that expires in 2028, which is subject to a further 30-year
renewal, to distribute electricity to 143 cities in the state of
Para. In the first 9 months of 2013, CELPA sold 5.3 TWh to
approximately 1.99 million consumers, and had net revenues of
BRL1.5 billion which excludes BRL282 million construction revenues
and net loss of BRL118 million.

CELPA is controlled by Equatorial Energia S.A. (Equatorial, not
rated) since November 01, 2012 when it acquired 65.2% of the
voting capital from Rede Energia S.A for just BRL 1.00


CIA DE SANEAMENTO: Will Cut Bills for Customers Who Save Water
--------------------------------------------------------------
Denyse Godoy and Stephan Nielsen at Bloomberg News report that
Cia. de Saneamento Basico do Estado de Sao Paulo said it will cut
bills for customers who save water amid a drought that's draining
dams to a record low.

Sabesp is offering business and residential clients in the greater
Sao Paulo area a 30 percent discount through August if they cut
their monthly usage 20 percent below their average between
February 2013 and January 2014, the Sao Paulo-based company said
in a statement, according to Bloomberg News.

Bloomberg News notes that a dry spell in parts of Brazil is also
hurting coffee and sugar crops and sending electricity prices to a
record high as hydropower plants struggle with low reservoirs.

"Investors are concerned about the impact that the discount and
the rationing may have over the company's revenue," Bloomberg News
quoted Sandro Fernandes, an analyst at the brokerage firm Geraldo
Correa, as saying.  "If reservoir levels fall further, Sabesp will
just run out of the product it sells," Mr. Fernandes said,
Bloomberg News relates.

Bloomberg News discloses that Sabesp's net revenue may be BRL360
million (US$148.3 million) lower than the previously estimated
BRL9.57 billion because of the discount for clients, according to
a research note from Goldman Sachs Group Inc.

Sabesp's Cantareira water system, which supplies water to almost
10 million people, is at a "critical level," according to the
statement, Bloomberg News says.  The system is at 21.9 percent of
capacity, its lowest level ever.

Companhia de Saneamento Basico do Estado de Sao Paulo (SABESP)
provides basic and environmental sanitation services; and supplies
treated water on a wholesale basis to residential, commercial,
industrial, and municipal customers in the State of Sao Paulo.

As reported in the Troubled Company Reporter-Latin America on Nov.
14, 2013, Standard & Poor's Ratings Services affirmed its 'BB+'
global scale and 'brAA+' national scale corporate credit ratings
on Companhia de Saneamento Basico do Estado de Sao Paulo (SABESP).
The outlook on both scales remains positive.  The company's stand-
alone credit profile (SACP) is 'bb+'.


* BRAZIL: Treasury Cancels Bond Auctions Citing Market Conditions
-----------------------------------------------------------------
Filipe Pacheco at Bloomberg News reports that Brazilian Treasury
canceled auctions of Brazilian government's fixed-rate and zero-
coupon bonds scheduled for today, Feb. 6, citing market
conditions.

"The market is reacting calmly and sees that the Treasury is not
desperate to refinance its debt," Ricardo Ramos, trader at Icap do
Brasil in Sao Paulo, told Bloomberg News in a phone interview.


==========================
C A Y M A N  I S L A N D S
==========================


AVILA FUND: Commences Liquidation Proceedings
---------------------------------------------
On Dec. 22, 2008, the shareholders of Avila Fund Ltd. resolved to
voluntarily liquidate the company's business.

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidator is:

          Commerce Corporate Services Limited
          c/o CIBC Financial Centre
          11 Dr. Roy's Drive
          P.O. Box 694 Grand Cayman, KY1-1107
          Cayman Islands


CABA LIMITED: Placed Under Voluntary Wind-Up
--------------------------------------------
At an extraordinary general meeting held on Dec. 6, 2013, the
shareholders of Caba Limited resolved to voluntarily wind up the
company's operations.

The creditors are required to file their proofs of debt to be
included in the company's dividend distribution.

The company's liquidator is:

          Commerce Corporate Services Limited
          P.O. Box 694 Grand Cayman
          Telephone: 949 8666
          Facsimile: 949 0626
          Cayman Islands


CANADIAN SHIELD: Shareholders Receive Wind-Up Report
----------------------------------------------------
The shareholders of Canadian Shield Offshore Fund, Ltd received on
Jan. 10, 2014, the liquidator's report on the company's wind-up
proceedings and property disposal.

The company's liquidator is:

          Avalon Ltd.
          Landmark Square, 1st Floor
          64 Earth Close, West Bay Beach
          P.O. Box 715 Grand Cayman KY1-1107
          Cayman Islands
          Facsimile: +1 (345) 769-9351


DRAGONSPELL HOLDINGS: Commences Liquidation Proceedings
-------------------------------------------------------
On Dec. 6, 2013, the shareholders of Dragonspell Holdings Limited
resolved to voluntarily liquidate the company's business.

Only creditors who were able to file their proofs of debt by
Jan. 6, 2014, will be included in the company's dividend
distribution.

The company's liquidator is:

          CDL Company Ltd.
          P.O. Box 31106 Grand Cayman KY1-1205
          Cayman Islands


FCM REINSURANCE: Commences Liquidation Proceedings
--------------------------------------------------
At an extraordinary general meeting held on Aug. 19, 2013, the
shareholders of FCM Reinsurance Ltd. resolved to voluntarily
liquidate the company's business.

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidator is:

          Stuart Jessop
          Windward 3, 5th Floor
          Regatta Office Park, West Bay Road
          Grand Cayman KY1-1105
          Cayman Islands


HELIUM MASTER: Commences Liquidation Proceedings
------------------------------------------------
On Dec. 4, 2013, the sole shareholder of Helium Master Fund
Limited resolved to voluntarily liquidate the company's business.

Creditors are required to file their proofs of debt to be included
in the company's dividend distribution.

The company's liquidator is:

          Syquant Capital
          Laurent Boscherel
          67 rue la Boetie
          75008 Paris
          France
          Telephone: +331.42.56.56.27


IVIRON FUND: Placed Under Voluntary Wind-Up
-------------------------------------------
At an extraordinary general meeting held on Nov. 29, 2013, the
shareholders of The Iviron Fund resolved to voluntarily wind up
the company's operations.

Only creditors who were able to file their proofs of debt by
Jan. 17, 2014, will be included in the company's dividend
distribution.

The company's liquidator is:

          Fides Limited
          P.O. Box 10338 Grand Cayman KY1-1003
          Telephone: (345) 949-7232


LAIDA LIMITED: Shareholders Receive Wind-Up Report
--------------------------------------------------
The shareholders of Laida Limited received on Jan. 6, 2014, the
liquidator's report on the company's wind-up proceedings and
property disposal.

The company's liquidator is:

          Royhaven Secretaries Limited
          c/o Julie Reynolds
          Telephone: +1 (345) 914 1344
          Facsimile: +1 (345) 945 4799
          Coutts & Co (Cayman) Limited
          Coutts House
          1446 West Bay Road
          P.O. Box 707 Grand Cayman KY1-1107
          Cayman Islands


MCT CAPITAL: Placed Under Voluntary Wind-Up
-------------------------------------------
At an extraordinary general meeting held on Nov. 29, 2013, the
shareholders of MCT Capital Management Ltd. resolved to
voluntarily wind up the company's operations.

Only creditors who were able to file their proofs of debt by
Jan. 17, 2014, will be included in the company's dividend
distribution.

The company's liquidator is:

          Fides Limited
          P.O. Box 10338 Grand Cayman KY1-1003
          Telephone: (345) 949-7232


PCM SPC: Shareholders Receive Wind-Up Report
--------------------------------------------
The shareholders of PCM SPC received on Jan. 7, 2014, the
liquidator's report on the company's wind-up proceedings and
property disposal.

The company's liquidator is:

          Florence Lo
          Telephone: (852) 6908 2833
          Facsimile: (852) 3602 3051
          Ogier Fiduciary Services (Cayman) Limited
          89 Nexus Way, Camana Bay
          Grand Cayman KY1-9007
          Cayman Islands


PYTHIA LIMITED: Shareholder Receives Wind-Up Report
---------------------------------------------------
The shareholder of Pythia Limited received on Jan. 13, 2014, the
liquidator's report on the company's wind-up proceedings and
property disposal.

The company's liquidator is:

          Ogier
          c/o Jo-Anne Maher
          Telephone: (345) 815-1762
          Facsimile: (345) 949-9877


RAM CAPITAL: Placed Under Voluntary Wind-Up
-------------------------------------------
On Dec. 6, 2013, the sole shareholder of Ram Capital Structure
Arbitrage, Ltd. resolved to voluntarily wind up the company's
operations.

The creditors are required to file their proofs of debt to be
included in the company's dividend distribution.

The company's liquidator is:

          Avalon Ltd.
          Reference: GL
          Telephone: +1 (345) 769 4422
          Facsimile: +1 (345) 769 9351
          Landmark Square, 1st Floor
          64 Earth Close West Bay Beach
          P.O. Box 715, George Town
          Grand Cayman KY1-1107
          Cayman Islands


REDBREAST AIRCRAFT: Shareholders Receive Wind-Up Report
-------------------------------------------------------
The shareholders of Redbreast Aircraft Leasing Ltd received on
Jan. 10, 2014, the liquidator's report on the company's wind-up
proceedings and property disposal.

The company's liquidator is:

          Avalon Ltd.
          Landmark Square, 1st Floor
          64 Earth Close, West Bay Beach
          P.O. Box 715 Grand Cayman KY1-1107
          Cayman Islands
          Facsimile: +1 (345) 769-9351


RHONE-SAM: Placed Under Voluntary Wind-Up
-----------------------------------------
On Dec. 6, 2013, the sole shareholder of Rhone-Sam Select
(Cayman), Ltd resolved to voluntarily wind up the company's
operations.

The creditors are required to file their proofs of debt to be
included in the company's dividend distribution.

The company's liquidator is:

          Avalon Ltd.
          Reference: GL
          Telephone: +1 (345) 769 4422
          Facsimile: +1 (345) 769 9351
          Landmark Square, 1st Floor
          64 Earth Close West Bay Beach
          P.O. Box 715, George Town
          Grand Cayman KY1-1107
          Cayman Islands


RITCHIE DEBT: Placed Under Voluntary Wind-Up
--------------------------------------------
On Dec. 6, 2013, the sole shareholder of Ritchie Debt Acquisition
Fund, Ltd. resolved to voluntarily wind up the company's
operations.

The creditors are required to file their proofs of debt to be
included in the company's dividend distribution.

The company's liquidator is:

          Avalon Ltd.
          Reference: GL
          Telephone: +1 (345) 769 4422
          Facsimile: +1 (345) 769 9351
          Landmark Square, 1st Floor
          64 Earth Close West Bay Beach
          P.O. Box 715, George Town
          Grand Cayman KY1-1107
          Cayman Islands


RITCHIE RML: Placed Under Voluntary Wind-Up
-------------------------------------------
On Dec. 6, 2013, the sole shareholder of Ritchie RML Capital III,
Ltd. resolved to voluntarily wind up the company's operations.

The creditors are required to file their proofs of debt to be
included in the company's dividend distribution.

The company's liquidator is:

          Avalon Ltd.
          Reference: GL
          Telephone: +1 (345) 769 4422
          Facsimile: +1 (345) 769 9351
          Landmark Square, 1st Floor
          64 Earth Close West Bay Beach
          P.O. Box 715, George Town
          Grand Cayman KY1-1107
          Cayman Islands


SL PREMIUM: Placed Under Voluntary Wind-Up
------------------------------------------
At an extraordinary general meeting held on Nov. 29, 2013, the
shareholders of SL Premium Equity Fund Ltd. resolved to
voluntarily wind up the company's operations.

Only creditors who were able to file their proofs of debt by
Jan. 17, 2014, will be included in the company's dividend
distribution.

The company's liquidator is:

          Fides Limited
          P.O. Box 10338 Grand Cayman KY1-1003
          Telephone: (345) 949-7232


SPECIAL CREDIT: Placed Under Voluntary Wind-Up
----------------------------------------------
On Dec. 6, 2013, the sole shareholder of Special Credit
Opportunities, Ltd. resolved to voluntarily wind up the company's
operations.

The creditors are required to file their proofs of debt to be
included in the company's dividend distribution.

The company's liquidator is:

          Avalon Ltd.
          Reference: GL
          Telephone: +1 (345) 769 4422
          Facsimile: +1 (345) 769 9351
          Landmark Square, 1st Floor
          64 Earth Close West Bay Beach
          P.O. Box 715, George Town
          Grand Cayman KY1-1107
          Cayman Islands


TUTOR INTERNATIONAL: Shareholder Receives Wind-Up Report
--------------------------------------------------------
The shareholder of Tutor International, Ltd. received on Jan. 14,
2014, the liquidator's report on the company's wind-up proceedings
and property disposal.

The company's liquidator is:

          John D. Barrett
          c/o 15901 Olden Street,
          Symlar California 91342
          United States of America
          Telephone: +818 362 8391
          Facsimile: +818 364 8451


VENCAP 7 LLC: Commences Liquidation Proceedings
-----------------------------------------------
At an extraordinary general meeting held on Nov. 27, 2013, the
shareholders of Vencap 7 LLC resolved to voluntarily liquidate the
company's business.

Only creditors who were able to file their proofs of debt by
Dec. 16, 2013, will be included in the company's dividend
distribution.

The company's liquidator is:

          Ian D. Stokoe
          c/o Adam Keenan
          Telephone: (345) 914 8743
          Facsimile: (345) 945 4237
          P.O. Box 258 Grand Cayman KY1-1104
          Cayman Islands


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D O M I N I C A N   R E P U B L I C
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* DOMINICAN REP: Gas Stations Complain of Sagging Sales
-------------------------------------------------------
Dominican Today reports that Dominican Republic's gas station
owners grouped in Andegas complained that despite the 4.1%
economic growth, fuel consumption fell during 2013, which in their
view reveals a boom in contraband and harms public finances and
the stability of the businesses that pay taxes.

Anadegas President Emilio Vazquez said lower government revenue
from that fuel could lead to higher taxes on other derivatives of
petroleum, according to Dominican Today.

Mr. Vazquez, the report notes, also disclosed a picket in front of
the Industry and Commerce Ministry to demand a change in the
"temperature differential," the provision which allows the major
fuel suppliers to pocket extra income before the gasoline cools.

The group said refined fuels need to be heated to high
temperatures to pump through pipes, which increases volume, but
once cooled, it recovers its original volume, the report notes.

Mr. Vazquez, the report relays, added that international fuel
wholesalers have taken advantage of the volume differential during
the last 50 years.


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P A N A M A
===========


BANCO PANAMENO: S&P Affirms 'BB' ICR; Outlook Stable
----------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB' long term
issuer credit rating on Banco Panameno de la Vivienda, S.A. y
Subsidiarias (Banvivienda).  The outlook is stable.

Standard & Poor's Ratings Services' rating on Banvivienda reflects
the bank's "moderate" business position, "adequate" capital and
earnings, "adequate" risk position, "below average" funding, and
"adequate" liquidity, as S&P's criteria define these terms.

"Under our bank criteria, we use our Banking Industry Country Risk
Assessment's (BICRA) economic risk and industry risk scores to
determine a bank's anchor, the starting point in assigning an
issuer credit rating.  Our anchor for a commercial bank operating
only in Panama is 'bbb-', based on the country's economic risk
score of '6' and an industry risk score of '5'.  Panama's economic
risk assessment reflects high levels of household debt and a
limited ability to take on additional loans, which in our view,
results from the country's low per capita GDP.  The country's
economy has become increasingly resilient and diversified in the
past decade and it has shown adequate GDP growth rates for the
past five years.  However, our economic risk assessment also
considers Panama's small domestic market, which leads to its high
reliance on global and regional economic activity to drive its
growth.  In our view, credit growth itself doesn't worsen economic
imbalances, as it is fairly moderate.  Furthermore, whenever the
economy slows down, so does credit.  Other factors such as
commercial real estate (CRE) prices and the country's external
position pose additional risk in our economic imbalances
assessment, in our view.  Our industry risk assessment recognizes
that Panama adequately regulates and supervises financial
institutions, fostering the financial system's stability.  Despite
high leverage levels, Panama's authorities engage in adequate
oversight of the financial system and apply international
standards.  There are some minor exceptions to this policy, but
Panama's major banks' conservative management mitigates these
factors.  Nevertheless, our industry risk assessment remains
limited by the absence of a lender of last resort in the country.
Although the government offered liquidity support to all banks in
2008, we are uncertain that it would provide support again in the
event of an adverse economic scenario," S&P noted.

"The stable outlook reflects our expectations that the bank will
continue implementing its growth plan while maintaining adequate
risk position and asset quality metrics, adequate capitalization
levels with RAC ratios above 7%, and liquidity metrics that are in
line with is national peers," said Standard & Poor's credit
analyst Ivana Recalde.


GROUP UNITED: Panama Canal Expansion on 'Brink of Failure'
----------------------------------------------------------
Dan Molinski, writing for The Wall Street Journal, reported that
work to expand the Panama Canal so bigger ships can fit through
the 100-year-old waterway has virtually ground to a halt, and the
consortium in charge of the construction effort said the project
is now on the "brink of failure" after talks broke down between
the contractors and Panama's government over who is going to pay
for $1.6 billion in cost overruns.

According to the report, the storied canal, built by American
engineers, is among the world's most vital shipping routes, acting
as a shortcut between the Pacific and Atlantic oceans that shaves
nearly two weeks off travel times for ships that otherwise would
need to travel around South America at Cape Horn. But the canal
has become too narrow for the world's ever-larger ships, including
those hauling products such as natural gas and other fuels.
Countries including the U.S., which is fast becoming a net
exporter of natural gas as it uses new drilling technology to tap
into rock formations, are eager to take advantage of a wider canal
to boost their shipments to Asia.

But the expansion project, already 70% complete, is now in
turmoil, the report said.  Early on Feb. 5, the European building
consortium GUPC, or Group United for the Canal, said the
government-controlled Panama Canal Authority walked out on
monthlong talks late on Feb. 4 night. "The break in negotiations
puts the Panama Canal expansion and up to 10,000 jobs at immediate
risk," said the consortium, which is 48%-controlled by Sacyr SA of
Spain and 48%-controlled by Salini Impregilo SpA of Italy, notes
the report.

Hours later, Jorge Quijano, the head of the Panama Canal
Authority, a government agency, said GUPC is to blame for the
collapse in negotiations, accusing the consortium of going outside
the contract to demand "exorbitant" and undeserved funding for
cost overruns that haven't been substantiated, the report related.

The canal authority said "almost all" the work by GUPC stopped on
Wednesday, and demanded that the consortium resume its activities,
adding that the construction companies need to take advantage of
Panama's dry season to get as much work done as possible, notes
the WSJ report.


===============
P A R A G U A Y
===============


PARAGUAY: Moody's Ups Gov't. Bond Rating to Ba2; Outlook Positive
-----------------------------------------------------------------
Moody's Investors Service has upgraded Paraguay's government bond
rating by one notch to Ba2 from Ba3, and changed the outlook to
positive from stable.

Moody's decision to upgrade Paraguay's rating was driven by the
following factors:

1. The improving standing of Paraguay's key fiscal metrics
relative to 'Ba' peer medians,

2. A strengthened institutional framework as a result of the
legislation package that was approved last year,

3. A smooth political transition since the impeachment of former
president Fernando Lugo in 2012.

Ratings Rationale

First Driver - Improving Standing Of Key Fiscal Metrics Relative
to 'Ba' Peer Medians

After the central government reported average debt ratios of 18%
of GDP and 112% of revenues during 2003-2012, compared with the
39% and 149% for 'Ba'-rated medians during the same period, these
debt ratios declined to just 12.7% of GDP and 79% of revenues in
2013. That is well below the 'Ba' medians of 36% and 151%,
respectively. Debt affordability, as measured by the ratio of
interest payment to revenues, is high at less than 2% (Ba median:
7.7%) owing to the largely concessional nature of Paraguay's debt.
The country's average debt maturity is over 20 years.

Although most of the government's debt is in foreign currency,
Paraguay has a natural hedge since revenues from hydroelectric
energy sales to Brazil and Argentina are US dollar-denominated.

Second Driver -- Strengthened Institutional Framework

The government of President Horacio Cartes, who took office in
August 2013, secured passage of several key pieces of legislation
within months of coming to power, including a tax reform, a Fiscal
Responsibility Law, a Law to Modernize Financial Administration, a
Public Private Partnership (PPP) Law, and a revision of the
Sovereign Bond Law.

Third Driver -- Smooth Political Transition

The transition of power since the impeachment of former president
Fernando Lugo has been smooth and seamless, including the
changeover to the interim Franco administration and more recently
to the new Cartes administration. There was no material impact on
the economy or to the country's creditworthiness during the
transition period. And Paraguay was ultimately reincorporated into
MERCOSUR. Throughout the transition, the technical capacity of the
Ministry of Finance and central bank remained strong.

Rationale For Positive Outlook

The positive outlook on the Ba2 rating reflects our expectation
that, even though it will take time for the government to
implement the various laws approved in late 2013, they are likely
to improve fiscal oversight (e.g., through the Fiscal
Responsibility Law) and allow for higher levels of infrastructure
investment (e.g., through the PPP law and/or the revision of the
Sovereign Bond Law) over the medium-to-long term.

What Could Move The Ratings Up/Down

Upward rating pressure could result from: (i) successful
implementation of recently passed laws; (2) investments in the
economy that could enhance economic diversity and/or markedly
improve infrastructure.

Downward rating pressure could result from: (1) a reversal of the
government's prudent fiscal management (2) a significant and
prolonged commodity shock driven by declining prices or adverse
climate conditions; (3) recurrent political instability.

Country Ceilings

As a result of this rating action, the long-term local currency
bond and deposit ceilings changed to Baa3 from Ba1, while the
short-term local currency bond and deposit ceilings changed to P3
from Not Prime. The long-term foreign currency deposit ceiling
changed to Ba3 from B1, while the short-term foreign currency
deposit ceiling remains at Not Prime. The long-term foreign
currency bond ceiling remains unchanged at Ba1, while the short-
term foreign currency bond ceiling remains Not Prime.

GDP per capita (PPP basis, US$): $6,053 (2012)

Real GDP growth (% change): 13.6% (2013 Estimate)

Rate (CPI, % change Dec/Dec): 4.2% (2013 Estimate)

Gen. Gov. Financial Balance/GDP: -1.9% (2013 Estimate)

Current Account Balance/GDP: 0.8% (2013 Estimate)

External debt/GDP: 18.2% (2013 Estimate)

Level of economic development: Low level of economic resilience

Default history: At least one default event (on bonds and/or
loans) has been recorded since 1983.

On 29 Jan 2014, a rating committee was called to discuss the
rating of the Paraguay, Government of.The main points raised
during the discussion were: The issuer's institutional
strength/framework, have materially increased. The issuer's fiscal
or financial strength, including its debt profile, has materially
increased. The issuer has become increasingly susceptible to event
risks. An analysis of this issuer, relative to its peers,
indicates that a repositioning of its rating would be appropriate.
Other views raised included: The issuer's economic fundamentals,
including its economic strength, have not materially changed. The
issuer's governance and/or management, have not materially
changed. The systemic risk in which the issuer operates has not
materially changed.

The principal methodology used in this rating was Sovereign Bond
Ratings Methodology published in September 2013.


=====================
P U E R T O   R I C O
=====================


GOVERNMENT DEV'T BANK: S&P Lowers LT Issuer Credit Rating to 'BB'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its long-term
issuer credit rating on the Government Development Bank for Puerto
Rico (GDB) to 'BB' from 'BBB-' and its short-term issuer credit
rating to 'B' from 'A-3'.  S&P initially placed the ratings on
CreditWatch with negative implications on Jan. 24, 2014.  The
ratings remain on CreditWatch with negative implications.

"The downgrade reflects GDB's constrained market access, which has
led to a material deterioration in its liquidity position," said
Standard & Poor's credit analyst Sunsierre Newsome.  "It also
reflects GDB's high business and loan exposure to the Commonwealth
of Puerto Rico, whose creditworthiness has deteriorated, and other
government related entities."

GDB, which is providing permanent and bridge financing to the
local public sector, is experiencing a steady deterioration in its
liquidity position.  Public-sector loans have increased, while
public-sector deposits, which constitute the bulk of the bank's
deposit base, have declined materially.  S&P estimates GDB's loan-
to-deposit ratio to be, currently, higher than 160%, demonstrating
a structural funding reliance on market access.  S&P could see
some inflows of public-sector deposits in the coming months as a
result of a proposed bill authorizing GDB to require certain
public-sector entities to transfer their deposits, which are
currently held at private local banks, to GDB.  Potential related
deposit inflows are unlikely to be significant enough, in S&P's
opinion, to materially improve GDB's liquidity position.

"In our opinion, GDB currently has a reduced ability to fund the
Commonwealth's liquidity needs in the coming quarters without
accessing the markets," said Ms. Newsome.

Issuances by either GDB or the Commonwealth have been modest in
recent quarters.  For example, on Dec. 27, 2013, GDB placed
$110 million of notes yielding 8% with the Puerto Rico State
Insurance Fund Corp., a government entity that provides workers
compensation.  Although S&P expects GDB or the Commonwealth to
access the market in the near future, this will likely be more
difficult and significantly more expensive than in the past, in
S&P's view.  The other liquidity sources of GDB are primarily
related to its investment portfolio.  The $2.8 billion investment
portfolio, as of Sept. 30, 2013, consists primarily of U.S.
Treasury securities, U.S. agency securities, mortgage-backed
securities, and money market investments.  About half of the
portfolio is pledged, which leaves more than $1 billion, by S&P's
calculation, available as collateral to obtain secured funding.
GDB is not regulated and supervised by the Federal Reserve Board
or the Federal Deposit Insurance Corp., and the bank currently is
not a member of any Federal Home Loan Bank (FHLB).  Therefore, it
cannot borrow from an FHLB, nor does it have access to a central
bank for contingent liquidity.  This exacerbates the pressure on
S&P's assessment of its liquidity, given the company's current
funding constraints.

As a result, S&P is revising its liquidity assessment to
"moderate" from "adequate" (as S&P's criteria describe the terms).
GDB's funding is "below average."  These two factors combined cap
the stand-alone credit profile at 'bb'.

S&P also believes that the deterioration in the creditworthiness
of the Commonwealth has weakened the bank's business position.
The bulk of GDB's balance-sheet activities are tied to the
Commonwealth, either by extending loans to the government and
other government related entities, or by collecting public-sector
deposits.  As a consequence, S&P has lowered its business position
score to "weak" from "moderate."

The current pressures experienced by the Commonwealth heighten the
risk of GDB's heavy loan portfolio concentration to the
Commonwealth.  Loans also tend to be outsize, with GDB's 20
largest borrowers making up the majority of the loan portfolio.
Many of the Commonwealth's agencies and instrumentalities have had
losses from operations, which could affect their ability to repay
their outstanding loan balances.  However, GDB has entered into
fiscal oversight agreements with some of its largest borrowers to
allow the bank to more closely monitor these entities' finances.
Still, nonperforming assets have doubled over the past few years.
Although specific revenue sources fund the repayment of private
loans--most of which are nonperforming--budgetary constraints and
the weak fiscal state of Puerto Rico could limit payment.  As a
consequence, S&P has also revised its risk position score to
"weak" from "moderate."

Although S&P views GDB as a government-related entity based on its
view that the link between GDB and the Commonwealth is very
strong, S&P do not ascribe uplift to its ratings because of the
one notch rating difference with the Commonwealth GO rating.  GDB
plays a very important role for the government, given that it
provides funding to the Commonwealth and other Puerto Rican public
corporations and that it is a fiscal agent to the Commonwealth and
its instrumentalities.

The ratings remain on CreditWatch with negative implications.  The
current pressures on funding access that the Commonwealth is
experiencing weaken GDB's liquidity profile.  S&P's ratings
reflect expectations that either GDB or the Commonwealth will
access the market in the near future.  S&P would view a debt
placement by either GDB or the Commonwealth of $1 billion or more
as an important credit stabilizing factor.  S&P could further
lower the ratings if the bank failed to raise additional funding
in the coming months or to otherwise improve cash flows.  S&P
expects to resolve or address the CreditWatch within the next
couple of months.


PUERTO RICO: GO Bonds Inch Higher After S&P Downgrade
-----------------------------------------------------
Al Yoon and Mike Cherney, writing for The Wall Street Journal,
reported that Puerto Rico's bonds inched higher a day after
Standard & Poor's cut the island's credit rating to junk status,
as some buyers are relieved to have the event behind them,
according to traders and investors.

"The markets can now trade without the heavy weight of a downgrade
looming over its head," said Randy Jacobus, a portfolio manager
with Alternative Strategy Advisers LLC, the report cited.

Among large trades, $1 million Puerto Rico 5% general obligation
bonds maturing in 2041 traded at 67 cents on the dollar on the
morning of Feb. 5, up from 66.75 cents on a $3.1 million trade on
Feb. 4, according to the Municipal Securities Rulemaking Board's
website, the report related.

The $837 million Market Vectors High-Yield Municipal Index ETF,
which includes some Puerto Rico debt, rose almost 1% on Feb. 5,
the report said.  Share prices for the ETF fell more than 1.2% on
Feb. 4, with a clear drop about when S&P announced the downgrade.

"There hasn't been anything representing a wave of panic selling
or great volatility in any of the Puerto Rico credits in the
secondary market," said Jim Colby, senior municipal strategist and
portfolio manager at Van Eck Global, which manages the ETF, the
report cited.  "This is being reflected in the valuation of the
stock today."


PUERTO RICO: Investors Appears to Shrug Off Debt Downgrade
----------------------------------------------------------
Michael Corkery, writing for The New York Times' DealBook,
reported that investors' faith in Puerto Rico's debt appeared
undaunted on Feb. 5 after Standard & Poor's cut the island's
credit rating to junk a day earlier.

According to the report, analysts and traders said prices of some
Puerto Rico bonds traded lower on Feb. 4, but there was no mass
selling that might indicate a panic. The spread between Puerto
Rico's 30-year general obligation bonds and a benchmark of highly
rated municipal bonds was unchanged from Feb. 4, when S.&P. issued
its downgrade, according to Thomson Reuters Municipal Market Data.

Many investors shrugged off the downgrade, saying they had
anticipated it months ago, while others said the possibility of a
default remained remote, the report related.

"I think the market for Puerto Rico bonds has been oversold," said
James Colby, senior strategist for Van Eck's municipal exchange-
traded funds, which have exposure to Puerto Rico bonds, the report
cited.  "Is there a possibility for further downgrades? Yes. Does
it mean they are not going to pay? No."

Such confidence in the beleaguered island's ability to pay back
its debts is based on a longstanding bargain: Investors have been
willing to lend Puerto Rico billions of dollars to deal with its
grave economic problems, the report pointed out.  In exchange, its
bonds have historically generated some of the highest returns in
the municipal debt market.


PUERTO RICO: S&P Cuts Debt to Junk, Cash Squeeze Intensifies
------------------------------------------------------------
Mary Williams Walsh, writing for dealbook.nytimes.com, reports
that Standard & Poor's downgraded the debt of Puerto Rico to junk
status, intensifying a cash squeeze for the commonwealth, whose
financial condition is of outsize importance to the rest of the
United States because its debt is widely held by individual
investors through mutual funds.

S&P, which lowered its rating to BB+ from BBB-, said it had
decided that Puerto Rico was no longer qualified as investment
grade because its government was losing its ability to raise cash
through the Government Development Bank, according to
dealbook.nytimes.com.  S&P, the report notes, said it did not
expect the cash squeeze to ease soon and was keeping all of Puerto
Rico's debt on negative watch, which means more downgrades could
follow.

The report discloses that the implications of slipping into junk
territory are greater than a one-notch downgrade might suggest.  A
good portion of Puerto Rico's debt was issued with promises to
make cash payments if it fell below investment grade, and ready
cash is precisely what Puerto Rico lacks, the report relays.

dealbook.nytimes.com discloses that S&P estimated that the
downgrade would initiate cash calls totaling $940 million,
including the acceleration of debt service and the posting of
additional collateral on interest-rate swaps.

Some of those commitments call for Puerto Rico to produce the cash
within 30 days.

"We understand that the G.D.B. is currently negotiating to have
certain debt holders waive acceleration provisions," S.&P. said,
referring to the Government Development Bank, which orchestrates
the island's many borrowings, among other duties, the report
notes.  S.&P. said the development bank was also "arranging for
new multiyear external bank credit lines that could mitigate near-
term liquidity risks," the report relates.

The report says that some institutional holders of Puerto Rico's
debt have rules saying they cannot hold junk-rated debt, although
those rules typically kick in after two such downgrades by the top
rating agencies.  That left market participants watching for the
next downgrade; Moody's Investors Service and Fitch Ratings both
rate Puerto Rico's debt a single notch above junk, the report
notes.

"I think you'd be hard-pressed to find any financial professional
who did not think Puerto Rico did not deserve an investment grade
rating," the report quoted Matt Fabian, a managing director at
Municipal Market Advisors.  "You have to expect more downgrades."

Mr. Fabian, the report relates, said the mere fact that S.&P. had
taken the step would reduce market confidence, making downgrades
by the other firms more likely.

The report notes that Puerto Rico had been planning to bring $1
billion to $2 billion of new debt to market this month or next.
The downgrade and cash calls seemed likely to complicate that
borrowing, the report relates.

The Puerto Rican treasury secretary, Melba Acosta Febo, and the
chairman of the Government Development Bank, David H. Chafey Jr.,
issued a joint statement confirming that they were having
discussions with unidentified parties about how to address
immediate cash needs, the report notes.

"We are confident that we have the liquidity on hand to satisfy
all liquidity needs until the end of the fiscal year, including
any cash needs resulting from today's decision," the two officials
said, the report adds.


PUERTO RICO AQUEDUCT: S&P Lowers Revenue Bonds Rating to 'BB+'
--------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered by one notch,
to 'BB+', the rating on Puerto Rico Aqueduct & Sewer Authority's
(PRASA) revenue bonds guaranteed by the Commonwealth of Puerto
Rico.  The rating remains on CreditWatch, where it was placed with
negative implications on Jan. 24, 2014.  The downgrade and
CreditWatch status reflect S&P's similar action today on the
commonwealth's general obligation (GO) debt rating.

In addition, S&P has placed the 'BB+' rating on PRASA's senior-
lien (gross pledge) revenue bonds on CreditWatch with negative
implications.  Although the rating is not immediately affected by
the downgrade, the CreditWatch action on those bonds reflects the
relationship between PRASA and the commonwealth.  PRASA's stand-
alone credit profile remains 'bb+', which reflects S&P's view of
the authority's general creditworthiness solely on its own
fundamentals.

"The CreditWatch action on the senior-lien revenue bonds is based
our opinion that PRASA is a governmental-related entity of the
commonwealth.  Should the GO rating be lowered again, we would
also downgrade the commonwealth-supported PRASA bonds as well as
PRASA's senior-lien revenue bonds," said Standard & Poor's credit
analyst Ted Chapman.  "The Government Development Bank (GDB)
continues to be the key tool for financing the commonwealth's
structural budgetary gap, which also then affects PRASA debt
supported by the commonwealth.  The GDB is also PRASA's main
source of interim capital improvement funding by way of several
different revolving credit agreements and committed lines of
credit," said Mr. Chapman.

PRASA's commonwealth-backed debt is about $1.1 billion (including
State Revolving Fund and U.S. Dept. of Agriculture borrowings) out
of the authority's roughly $4.6 billion in total debt.


UNIV. OF PUERTO RICO: S&P Lowers SPUR to 'BB+' on Revenue Bonds
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term rating
and underlying rating (SPUR) to 'BB+' from 'BBB-' on the
University of Puerto Rico's  (UPR) existing university system
revenue bonds, some of which were issued by the Puerto Rico
Industrial, Tourist, Educational, Medical, & Environmental Control
Facilities Finance Authority.  S&P also lowered the standalone
credit profile on the university to 'bb+' from 'bbb-'.  The rating
remains on CreditWatch with negative implications.

"Per our government related entities (GRE) criteria, a rating
change on Puerto Rico (BB+/Watch Negative) would result in a
rating change to the UPR given the high likelihood of
extraordinary support," said Standard & Poor's credit analyst
Bianca Gaytan-Burrell.


                            ***********


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.

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                            ***********


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

Troubled Company Reporter-Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Valerie U. Pascual, Julie Anne L. Toledo, and Peter A.
Chapman, Editors.

Copyright 2014.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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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,
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202-241-8200.


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