/raid1/www/Hosts/bankrupt/TCRLA_Public/140221.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Friday, February 21, 2014, Vol. 15, No. 37
Headlines
A R G E N T I N A
BANCO COLUMBIA: Moody's Withdraws Caa2 Deposit Rating
B E R M U D A
TOWER GROUP: Incurs $344.13MM Net Loss in Quarter Ended Sept. 30
B O L I V I A
* BOLIVIA: IDB OKs US$43MM Loan to Improve Public Health System
B R A Z I L
BRAZIL: Fitch Says 2014 Performance Should Pressure Revenues
FIBRIA CELULOSE: To Relocate US Distribution Center to Tioga
FIBRIA CELULOSE: Fitch Ups LT Issuer Default Ratings to 'BBB-'
INTEGRAL EXCEEDS: Fitch Affirms 'BBsf (bra)' Rating on Sr. Shares
RB CAPITAL: Fitch Cuts 1st Issuance of CRIs Rating to 'Bsf(bra)'
C A Y M A N I S L A N D S
BLUEBIN LIMITED: Placed Under Voluntary Wind-Up
BRACKISH LIMITED: Placed Under Voluntary Wind-Up
CHEYENNE ASSETS: Creditors' Proofs of Debt Due March 11
CLOVERFIELD LIMITED: Placed Under Voluntary Wind-Up
EASTERN ADVISORS: Commences Liquidation Proceedings
EMERAUDE HEDGE: Commences Liquidation Proceedings
J. ZOROASTER: Creditors' Proofs of Debt Due March 11
JH INTERNATIONAL: Creditors' Proofs of Debt Due March 5
KOREA ACE: Commences Liquidation Proceedings
LINQI ASSET: Placed Under Voluntary Wind-Up
P2 GRENZE KYOTO: Commences Liquidation Proceedings
P2 GRENZE NARA: Commences Liquidation Proceedings
PACIFIC STAR: Creditors' Proofs of Debt Due Feb. 28
QUARTET THREE: Commences Liquidation Proceedings
QUARTET TWO: Commences Liquidation Proceedings
SOLUS CORE FUND: Placed Under Voluntary Wind-Up
SOLUS CORE INTERMEDIATE: Placed Under Voluntary Wind-Up
VISUAL CHINA: Placed Under Voluntary Wind-Up
C H I L E
* CHILE: Fitch Publishes 2014 Outlook for Corporate Sector
J A M A I C A
UC RUSAL: Bullish on Aluminum Sector Growth
M E X I C O
HSBC MEXICO: Moody's Puts 'B3' Rating of 3 Class Certs. on Review
SUL AMERICA: S&P Lowers LT Counterparty Credit Rating to 'BBB'
P A R A G U A Y
* PARAGUAY: IMF Exec. Board Concludes 2013 Article IV Consultation
P E R U
GRUPO ACP: Fitch Says Asset Sale No Immediate Effect on 'B' Rating
X X X X X X X X X
LATAM: Fitch Sees Deficit-Driven Increase in 2014 Financing Needs
- - - - -
=================
A R G E N T I N A
=================
BANCO COLUMBIA: Moody's Withdraws Caa2 Deposit Rating
-----------------------------------------------------
Moody's Latin America Agente de Calificacion de Riesgo announced
that it has withdrawn all of its ratings for Banco Columbia S.A.
for business reasons.
The following ratings of Banco Columbia S.A. were withdrawn:
Bank Financial Strength Rating: to E, negative outlook
Long- and short-term global local-currency deposits: Caa2/Not
Prime, negative outlook
Long- and short-term foreign-currency deposits: Caa2/Not Prime,
negative outlook
Long- term global local-and foreign currency MTN debt rating:
(P)Caa2, negative outlook
Long-term National Scale local-currency deposit rating: B1.ar,
negative outlook
Long-term National Scale foreign-currency deposit rating: B1.ar,
negative outlook
Long-term National Scale local-and foreign currency MTN debt
rating: B1.ar, negative outlook
Ratings Rationale
Moody's has withdrawn the rating for its own business reasons.
Banco Columbia S.A. is headquartered in Buenos Aires, Argentina,
and as of September 2013 it had $558.4 million in assets and $47.8
million in equity.
=============
B E R M U D A
=============
TOWER GROUP: Incurs $344.13MM Net Loss in Quarter Ended Sept. 30
----------------------------------------------------------------
Tower Group International, Ltd., filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q,
reporting a net loss of $344.13 million on $442.9 million of total
revenues for the three months ended Sept. 30, 2013, compared with
net income of $25.95 million on $474.89 million of total revenues
for the same period in 2012.
The Company's balance sheet at Sept. 30, 2013, showed $4.63
billion in total assets, $4.41 billion in total liabilities, and
stockholders' equity of $222.65 million.
As of Sept. 30, 2013, there were $235 million of subordinated
debentures outstanding. The subordinated debentures do not have
financial covenants that would cause an acceleration of their
stated maturities. The earliest stated maturity date is on a $10
million debenture, with a stated maturity in May 2033. The
Company has the ability to defer interest payments on its
subordinated debentures for up to twenty quarters.
The merger with ACP Re is expected to close by the summer of 2014,
and there are contractual termination rights available to each of
Tower and ACP Re under various circumstances. Therefore, there
can be no guarantee that the Company will be able to remedy
current statutory capital deficiencies in certain of its insurance
subsidiaries or maintain adequate levels of statutory capital in
the future. Consequently, there is substantial doubt about the
Company's ability to continue as a going concern, according to the
regulatory filing.
A copy of the Form 10-Q is available at:
http://is.gd/5QYdcO
Tower Group International, Ltd., operates as a holding company
with the interest in insurance services. The company operates
through its insurance subsidiaries, which are focused on providing
commercial, personal and specialty insurance and reinsurance
products. It provides personal insurance products to individuals
and commercial insurance products to small to medium-sized
businesses through a dedicated team of retail and wholesale
agents. The company also offers specialty products on an admitted
and non-admitted basis, as well as through a network of program
underwriting agents. It involves in underwriting, claims and
reinsurance brokerage services to other insurance companies. The
company was founded on Sept. 6, 2007, and is headquartered in
Hamilton, Bermuda.
=============
B O L I V I A
=============
* BOLIVIA: IDB OKs US$43MM Loan to Improve Public Health System
---------------------------------------------------------------
The Inter-American Development Bank (IDB) approved a US$43 million
loan for Bolivia to improve the public health system in the city
of El Alto and surrounding rural areas.
The goal of the project is to provide health care services that
will reduce mortality rates, especially maternal and infant
mortality, as well as morbidity and mortality stemming from
cervical-uterine cancer.
Despite posting a gain of eight years in life expectancy at birth
and reductions in mortality rates, over the past 20 years Bolivia
and the city of El Alto have nonetheless lagged behind on other
health indicators, with high rates of maternal and infant
mortality and mortality from cervical-uterine cancer. In the
period 2008-2012, 78 women died while giving birth in the
municipality of El Alto, 90 percent of them in the city itself.
El Alto has the highest population density and growth of any city
in Bolivia. It lacks sufficient infrastructure to provide
services for indigenous peoples, who number a million, and another
600,000 who live in nearby areas.
The IDB loan will provide financing to build and equip the
Hospital de Tercer Nivel Sur El Alto and get it up and running.
This facility will complement existing health care infrastructure
and enhance coverage and access to services for obstetric and
delivery emergencies. The plan also calls for financing a program
to monitor and treat cervical-uterine cancer. This will improve
management of health care services and the functioning of the
municipal health system, and encourage training and optimal use of
human resources.
The US$43 million IDB loan is made up of US$34.4 million in
ordinary capital lent out over 30 years with a six-year grace
period and a fixed interest rate; and US$8.6 million from the Fund
for Special Operations, over 40 years with the same six-year grace
period and an annual interest rate of 0.25 percent. The package
is being matched by a local contribution of US$5.52 million.
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B R A Z I L
===========
BRAZIL: Fitch Says 2014 Performance Should Pressure Revenues
------------------------------------------------------------
The continued lackluster domestic economy performance in 2014
should pressure the state's revenues and operating margins,
according to a new Fitch Ratings report.
"The pace of investments and new debt is directly linked to the
state's capacity to accommodate expenditures -- especially the
ones related to personnel -- in order to meet fiscal targets
imposed by the Federal Government. The majority of Brazilian
subnationals continue to fulfill the fiscal goals imposed by the
Federal adjustment programs despite the meager results presented
in 2013 and the expectation of economic stagnation in 2014," said
Paulo Fugulin, Associate Director.
The Fiscal Responsibility Law has been challenged by ad-hoc debt
authorizations granted to states also in 2013. States are facing
rising personal expenditures and Fitch does not expect material
changes following the state elections to be held in October 2014.
Further federal discussions should take a slow pace in 2014,
despite the need for a coordinated change. Financial forecasting
accuracy of states has been undermined by the recent economic
slowdown that affected not only the level of tax revenues but also
the amount of federal transfers.
FIBRIA CELULOSE: To Relocate US Distribution Center to Tioga
------------------------------------------------------------
Linda Loyd at Philly News reports that Fibria Celulose S.A. will
relocate its Northeastern United States distribution center to the
Tioga Marine Terminal in July.
The company will bring in from 12 to 18 ships a year to start,
with 300,000 to 350,000 metric tons, for distribution to paper
plants in Pennsylvania and beyond, according to Philly News.
Fibria Celulose will relocate the business from the Port of
Baltimore.
"We needed an alternative that would provide us better
competitiveness in the Northeast U.S.," the report quoted Mateus
Carmo, Fibria general manager for North American operations, as
saying. "The Port of Philadelphia provided us a better value for
operations," Mr. Carmo said, the report notes.
Headquartered in Sao Paulo, Brazil, Fibria Celulose S.A. engages
in the production, sale, and export of short fiber pulp. The
company primarily offers bleached eucalyptus kraft pulp used in
the manufacture of toilet paper; uncoated and coated paper for
printing and writing; and coated cardboard for packaging.
FIBRIA CELULOSE: Fitch Ups LT Issuer Default Ratings to 'BBB-'
--------------------------------------------------------------
Fitch Ratings has upgraded Fibria Celulose S.A. (Fibria) and
Fibria Overseas Finance Ltd. (Fibria Overseas) as follows:
Fibria
--Long-term foreign currency Issuer Default Rating (IDR) to 'BBB-'
from 'BB+';
--Long-term local currency IDR to 'BBB-' from 'BB+';
--Long-term national scale rating to 'AA+(bra)' from 'AA-(bra)'.
Fibria Overseas
--Long-term foreign currency IDR to 'BBB-' from 'BB+';
--USD63 million senior notes due 2019 to 'BBB-' from 'BB+';
--USD690 million senior notes due 2020 to 'BBB-' from 'BB+';
--USD561 million senior notes due 2021 to 'BBB-' from 'BB+'.
The Rating Outlooks for Fibria and Fibria Overseas have been
revised to Stable from Positive.
The upgrade of Fibra's ratings to investment grade reflects the
company's disciplined approach to reducing debt during the past
two years despite relatively weak market conditions. During this
time period, the company generated more than USD800 million of
free cash flow and raised about USD650 million of equity. Fibria
had USD4.1 billion of total debt as of Dec. 31, 2013 and USD3.1
billion of net debt. These figures compare favorably with USD6.1
billion of total debt and USD5 billion of net debt at the end of
2011.
About USD200 million of the debt reduction was due to Fibria's
decision to sell approximately 210,000 hectares of land to Parkia
Participacoes for a potential BRL1.650 billion, of which BRL500
million was received in Dec 2013. The upgrade of Fibria's ratings
was not a result of the decision by the company to sell this land,
as Fitch viewed that transaction as monetizing assets that were
used to support the existing ratings.
Fitch's upgrade of Fibria's ratings builds in an expectation that
the company will likely go ahead with the expansion of its Tres
Lagoas mill. Capex for this mill should be around USD2.5 billion
and will be heavily concentrated in 2015 and 2016. Market
conditions should continue to be challenging during 2014 and 2015
due to the startup of pulp mills in Brazil and Uruguay. Fibria's
net leverage is projected by Fitch to reach 3.0x before
construction of the mill would be completed, which is most likely
in the first half of 2017.
Key Rating Drivers
Declining Leverage and Absolute Debt Levels
Fibria's EBITDA generation benefited from higher pulp prices and
depreciation of the Brazilian real against the USD. The company
generated USD1.3 billion of EBITDA and USD794 million of funds
from operations (FFO) in 2013. Management initiatives have led to
USD1.9 billion of net debt reduction since the end of 2011 despite
difficult market conditions. The company's proactive steps to
reduce leverage included the issuance of USD658 million of equity.
Fibria ended 2013 with a net debt/EBITDA ratio of 2.4x and an FFO
net leverage ratio of 3.9x. These ratios compare favorably versus
3.4x and 4.7x, respectively, in 2012. Fibria's net leverage at
the end of 2013 would have been 2.6x if proceeds from the sale of
forestry land to Parkia had been excluded.
Excellent Business Position
Fibria's ratings continue to reflect the company's excellent
business position. It is the world's leading producer of market
pulp with 5.3 million tons of bleached eucalyptus kraft (BEKP)
market pulp capacity. Fibria's sales volumes are more stable than
most companies within the industry, as more than 50% of its sales
are directed toward the tissue paper market. The company's
leading position is viewed to be sustainable due to its ownership
of 967 thousand hectares of forest assets in Brazil upon which it
has developed 561 thousand hectares of eucalyptus plantations.
The nearly ideal conditions for growing trees in Brazil make these
plantations extremely efficient by global standards and give the
company a sustainable advantage in terms of cost of fiber and
transportation costs between forest and mills.
Challenging Market Conditions
2014 and 2015 are projected to be difficult for the pulp market
and pricing pressure could intensify following the pipeline of new
projects. Combined, these mills will expand supply by about 9% in
a market where demand is struggling to grow by more than 2%. In
2013, pulp prices were better than forecasted due to some delays
in the scheduled startups of new mills and closure of about 1
million tons of market capacity, along with increased demand for
pulp from China and North America and a slow recovery in other
parts of the world.
Credit Metrics to Remain Strong in 2014
Fitch projects that Fibria will generate about USD1.3 billion of
EBITDA and USD1.1 billion of FFO in 2014 and that net leverage
will decline to around 2.0x. This level of EBITDA is similar to
2013 despite Fitch's projection that the company' net pulp price
received should decline to USD600 per ton in 2014 from USD618 in
2013. The weakness of the Brazilian real versus the U.S. dollar
is a key variable in Fitch's projection that EBITDA will remains
steady despite declining pulp prices as nearly 85% of the
company's costs are denominated in reais. During 2013, the
company's cash cost of production declined to USD200 per ton from
USD220 per ton as the Brazilian real devalued versus the U.S.
dollar by 17%. With capital expenditures projected to be USD600
million and no dividend distributions, Fibria should generate
about USD450 million of free cash flow. The company will also
receive about USD375 million from the sale of land that could be
used to reduce debt.
Pulp Project to Temporarily Elevate Leverage
Fibria will decide during 2014 if it will build a new pulp mill,
Tres Lagoas II. Fitch's base case projection is that the company
will proceed with the project given its cost structure, which
should be among the lowest cost in the world due to the high
quality forestry assets around the potential mill and the
favorable logistics system. Fibria had previously postponed this
project, as well as an expansion of Veracel, as it sought to be a
leader in the consolidation of the industry. Investments of about
USD2.5 billion for the expansion project would pressure the
company's free cash flow and temporarily increase leverage. Fitch
base case, which uses net pulp prices of between USD600 and USD680
per ton during the construction period, results in net leverage
reaching 3.0x. Net leverage would quickly decline to around 2.0x
once the mill became operational. A key variable in Fitch's
projections is that the Brazilian real remains weaker than 2.5
BRL/USD.
Robust Liquidity
Fibria had USD1 billion of cash and marketable securities and
USD1.3 billion of short term debt. Excluding the 2020 notes that
will repurchased in March 2014, the company has debt maturities of
about USD635 million in 2014 and USD350 million in 2015. The
company enjoys strong access to both the debt and equities market.
Fibria's liquidity is enhanced with about USD630 million (USD500
million and BRL300 million lines) unused revolving credit
facility. The company also has land with an accounting value of
USD530 million and forestry plantations on this land that an
accounting value of USD1.450 billion. Fibria has monetized
portions of these holdings in the past to lower leverage and
enhance liquidity. The company received BRL500 million in
December 2013 and BRL605 million in January 2014 from the sale of
land and will receive an additional BRL298 million up to March.
Rating Linkage
The 'BBB-' IDR of Fibria Overseas Finance Ltd. (Fibria Overseas)
has been directly linked to that of its parent company, Fibria,
through Fitch's parent and subsidiary methodology. Fibria
Overseas is the Cayman Island-domiciled issuer of the guaranteed
2019, 2020, and 2021 senior notes.
Rating Sensitivities
Any change in management's philosophy toward maintaining a
stronger capital structure would be viewed negatively and could
lead to a negative rating action. A significant increase in
leverage ratios, above the levels projected by Fitch, and/or a
sharp deterioration of market conditions could also pressure the
classification. A debt financed acquisition could also lead to a
downgrade. A positive rating action is not expected in the medium
term.
INTEGRAL EXCEEDS: Fitch Affirms 'BBsf (bra)' Rating on Sr. Shares
-----------------------------------------------------------------
Fitch Ratings has affirmed the National Long-Term Rating 'BBsf
(bra)' from the first series of senior shares of Integral Exceeds
Investment Fund receivables Urban Development (Integral Overcomes
FDIC). At the same time, the agency removed the Rating Watch
Negative and assigned Negative Outlook to the rating.
The removal of observation and assigning the Negative Outlook
reflects the still fragile condition of the receivables portfolio
backing the issue, despite the observed improvement in credit
enhancement.
The rating reflects the ability of full and timely payment of
principal, adjusted by the price index Consumer Index (IPCA), plus
interest of 8.75% per annum, until the final maturity of the
series in December 2027.
Top Rating Rationale
Improved Credit Enhancement
Credit enhancement available to the senior shares increased to
29.5% in January 2014, up from 16.9% recorded in September 2013.
Credit enhancement and calculated by the ratio between the sum of
the value of performing and nonperforming credits remaining until
180 days and cash resources, subtracted the value of the senior
units, the sum of the value of performing and nonperforming until
180 days credits.
The Urbplan Development SA (Urbplan), formerly known as Scopel
Urban Development SA, originator of the claims underlying the
issuance, has fulfilled the obligations undertaken in a timely
instrument confession of debt signed in October 2013. Besides
paying the installments of the agreement, the company has
repurchased delinquent contracts for more than ninety days.
Thus, the provision for losses (PDD) the fund has fallen
substantially. On January 31, 2014, the PDD was BRL4, 8 million,
well below the BRL9, 4 million recorded in September 2013.
Furthermore, all funds received by the fund are used to amortize
the senior shares, after payment of expenses. Ja BRL10, one
million of senior shares, and the balance was BRL25, 7 million at
the end of January 2014 was amortized. There was also a balance
on BRL5, 3 million cash on the same date. Since October 2013, the
senior shares is being amortized sequentially with relation to
other dimensions.
High default on receivables
The improvement in credit enhancement, however, is due more
repurchases made by Urbplan than the behavior of the receivables
portfolio. In January 2014, more than ninety days delinquency was
20.4%, and over 180 days, 10.4%. In November 2013, the default
rate above ninety days reached 26.0% and above 180 days, 17.0%.
Delinquency rates are calculated by the ratio between the unpaid
balance of delinquent contracts and the total outstanding balance
of the loan portfolio.
Another factor that contributed to the increase in credit
enhancement was the transfer of the recovery of claims for
Interservicer Shops for Mortgage loans Ltda. (Interservicer). The
company already acted as master servicer of the portfolio, being
responsible for storing information relating to claims of Urbplan,
including those assigned to the fund, validate the reports sent to
the banks of generators Invoices and perform bank reconciliation
of payments made. The transition took longer than initially
anticipated, being completed in December 2013. However, has shown
effective results in the reconciliation of payments and receipts
of segregation that belong to the background and the transferor.
Poor Performance of Construction Projects
Part of delinquency can be explained by the poor performance in
relation to the progress of works of the nine projects. Integral
Investments SA (Integral), fund manager, has hired an independent
engineering firm to assess the stage of the works in which the
fund invests. The company found that, with exception of two
projects that rely on funding from private investors, there has
been little or no progress in recent months.
With the entry of new directors in Urbplan, appointed directly by
the controller, the Carlyle Group, the company is in the process
of restructuring. The Urbplan should introduce new physical and
financial schedules until the end of the first half of this year
and the work should be resumed soon.
Sensitivity Rating
The rating may be downgraded if the obligations undertaken in the
confession of debt are not met adequately, the default of the
claims remain elevated or if the works are not reproduced
satisfactorily soon.
RB CAPITAL: Fitch Cuts 1st Issuance of CRIs Rating to 'Bsf(bra)'
----------------------------------------------------------------
Fitch Ratings has downgraded to Bsf (bra), from BBsf (bra), the
National Long-term rating of the 53rd series of the first issuance
of Certificates of Real Estate Receivables (CRIs) of RB Capital
Securitizadora SA (RB Capital). At the same time, the agency
removed the Rating Watch Negative and assigned Negative Outlook to
the rating.
The rating downgrade reflects the challenge of improving the cash
flow available for the payment of the transaction. The removal of
observation and assigning the Negative Outlook reflects the
agency's opinion that only the medium term will be the results
achieved on measures to monetize inventory, and a possible
activation of the guarantee assumed by Cyrela Brazil Realty SA and
Participacoes (Cyrela National Long-term rating 'AA-(bra)' (AA
minus (bra)) on the acquisition of the land of Ponta D'Areia
Holding Participacoes SA (Ponta D 'Sand).
The rating reflects the ability of final and full payment of the
principal invested, adjusted by the National Consumer Price Index
(IPCA), plus interest of 8.5% per year. The legal maturity date
of the transaction and December 19, 2016, but their final maturity
expected and at December 19, 2015.
Rating Rationale
Major Credit Enhancement Negative
On January 19, 2014, the balance of receivables from units sold
was BRL22, 8 million and the value of units in stock for BRL28, 0
million, totaling BRL50, 8 million. This value is less than the
outstanding balance of CRIs of BRL54, 0 million on the same date.
For this operation, were granted 87% of the flow of receivables
units exchanged Ponta D'Areia, which translates into an increase
of 172.3% in negative credit. Even when including the stock, the
credit enhancement and negative in 22.8%.
Deposit Cyrela
The projects are developed by a Special Purpose Entity (SPE) owned
by Cyrela, which is also the guarantor of debt instrument
confession by which the land was acquired. The confession of debt
determines, among other things, that the SPE is responsible for
the construction of the projects and that the maximum period for
delivery is 36 months after the launch, with tolerance of 180
days. This time limit was exceeded in six months delivered in two
towers, and the other conclusion also suffered delays. The
confession of debt determines that in this case, the SPE or Cyrela
should pay Ponta D'Areia an amount equivalent to 21.41% of the
area of private enterprises, using the average price per square
meter practiced in the time of the refund.
Fitch believes that, if triggered and event of the sale of units
in stock, this warranty can make the CRIs are paid in full.
New Releases
A young and successful launch in land sold by Ponta D'Areia Cyrela
increase the flow of receivables of operation, improving credit
enhancement. However, there is no prediction for that to occur
due to low sales speed presented by projects already launched.
Of the 77 units belonging to Ponta D'Areia in launched projects,
only 47 were sold out so far. Both projects consist of eight
towers, of which only two were completed. The delivery of this
too expected to occur throughout 2014 until January 2015. The
significant delay in the works hurt sales, but the expectation and
the performance improves after delivery of the towers.
Sensitivity Rating
The rating of this transaction may be downgraded again if any bail
paid by Cyrela added to the outstanding balance of the units sold,
not providing sufficient resources to fully amortize the principal
and interest owed to CRIs until their legal final maturity in
December 19, 2016.
==========================
C A Y M A N I S L A N D S
==========================
BLUEBIN LIMITED: Placed Under Voluntary Wind-Up
-----------------------------------------------
At an extraordinary general meeting held on Jan. 13, 2014, the
shareholder of Bluebin Limited resolved to voluntarily wind up the
company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 18, 2014, will be included in the company's dividend
distribution.
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
BRACKISH LIMITED: Placed Under Voluntary Wind-Up
------------------------------------------------
At an extraordinary general meeting held on Jan. 13, 2014, the
sole shareholder of Brackish Limited resolved to voluntarily wind
up the company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 18, 2014, will be included in the company's dividend
distribution.
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
CHEYENNE ASSETS: Creditors' Proofs of Debt Due March 11
-------------------------------------------------------
The creditors of Cheyenne Assets Limited are required to file
their proofs of debt by March 11, 2014, to be included in the
company's dividend distribution.
The company commenced liquidation proceedings on Jan. 9, 2014.
The company's liquidator is:
Lion International Management Limited
Craigmuir Chambers,
P.O. Box 71, Road Town Tortola
British Virgin Islands
c/o Mr. Philip C Pedro
HSBC International Trustee Limited
Compass Point Bermudiana Road
Hamilton HM 11
Bermuda
Telephone: (441) 299-6482
Facsimile: (441) 299-6526
CLOVERFIELD LIMITED: Placed Under Voluntary Wind-Up
---------------------------------------------------
At an extraordinary general meeting held on Jan. 13, 2014, the
sole shareholder of Cloverfield Limited resolved to voluntarily
wind up the company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 18, 2014, will be included in the company's dividend
distribution.
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
EASTERN ADVISORS: Commences Liquidation Proceedings
---------------------------------------------------
On Jan. 8, 2014, the sole shareholder of Eastern Advisors Capital,
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:
Giles S. Eyre
405 Lexington Avenue, 32nd Floor
New York, New York 10174
United States of America
Telephone: +1 (212) 984 2339
EMERAUDE HEDGE: Commences Liquidation Proceedings
-------------------------------------------------
On Jan. 2, 2014, the sole shareholder of Emeraude Hedge Fund
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:
Ricardo Carneiro Monteiro
Tabapua No. 1123 CJ 2122
Itaim Bibi, Sao Paulo
Brazil
J. ZOROASTER: Creditors' Proofs of Debt Due March 11
----------------------------------------------------
The creditors of J. Zoroaster Co. Ltd. are required to file their
proofs of debt by March 11, 2014, to be included in the company's
dividend distribution.
The company commenced liquidation proceedings on Jan. 7, 2014.
The company's liquidator is:
Lion International Management Limited
Craigmuir Chambers,
P.O. Box 71, Road Town Tortola
British Virgin Islands
c/o Mr. Philip C Pedro
HSBC International Trustee Limited
Compass Point Bermudiana Road
Hamilton HM 11
Bermuda
Telephone: (441) 299-6482
Facsimile: (441) 299-6526
JH INTERNATIONAL: Creditors' Proofs of Debt Due March 5
-------------------------------------------------------
The creditors of JH International Limited are required to file
their proofs of debt by March 5, 2014, to be included in the
company's dividend distribution.
The company commenced liquidation proceedings on Jan. 8, 2014.
The company's liquidator is:
Lion International Management Limited
Craigmuir Chambers,
P.O. Box 71, Road Town
Tortola, British Virgin Islands
c/o Mr. Philip C Pedro
HSBC International Trustee Limited
Compass Point
Bermudiana Road
Hamilton HM 11
Bermuda
Telephone: (441) 299-6482
Facsimile: (441) 299-6526
KOREA ACE: Commences Liquidation Proceedings
--------------------------------------------
On Jan. 8, 2014, the sole shareholder of Korea Ace Mortgage 2B
Company 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 liquidators are:
Edel Andersen
Roger Priaulx
Telephone: (345) 815 8532
Facsimile: (345) 945 3470
c/o Genesis Trust & Corporate Services Ltd.
P.O. Box 448 Midtown Plaza
Elgin Avenue, George Town
Grand Cayman KY1-1106
Cayman Islands
LINQI ASSET: Placed Under Voluntary Wind-Up
-------------------------------------------
On Jan. 10, 2014, the sole shareholder of Linqi Asset Management
(Cayman) resolved to voluntarily wind up the company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 19, 2014, will be included in the company's dividend
distribution.
The company's liquidator is:
Ogier
c/o Maggie Kwok / Phoebe Chan
Telephone: (852) 3656 6005 / (852) 3656 6063
Facsimile: (345) 949-9877
89 Nexus Way, Camana Bay
Grand Cayman KY1-9007
Cayman Islands
P2 GRENZE KYOTO: Commences Liquidation Proceedings
--------------------------------------------------
On Jan. 14, 2014, the shareholder of P2 Grenze Kyoto Holding KY LP
Ltd. resolved to voluntarily liquidate the company's business.
Only creditors who were able to file their proofs of debt by
Feb. 18, 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
P2 GRENZE NARA: Commences Liquidation Proceedings
-------------------------------------------------
On Jan. 14, 2014, the shareholder of P2 Grenze Nara Holding KY GP
Ltd. resolved to voluntarily liquidate the company's business.
Only creditors who were able to file their proofs of debt by
Feb. 18, 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
PACIFIC STAR: Creditors' Proofs of Debt Due Feb. 28
---------------------------------------------------
The creditors of Pacific Star GOF Advisers Ltd are required to
file their proofs of debt by Feb. 28, 2014, to be included in the
company's dividend distribution.
The company commenced liquidation proceedings on Dec. 17, 2013.
The company's liquidator is:
Arjun Dosan
3 Church Street
#20-01/06 Samsung Hub
Singapore 049483
QUARTET THREE: Commences Liquidation Proceedings
------------------------------------------------
On Jan. 7, 2014, the sole member of Quartet Three 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:
Phang Thim Fatt
8 Shenton Way #18-01
Singapore 068811
QUARTET TWO: Commences Liquidation Proceedings
----------------------------------------------
On Jan. 7, 2014, the sole member of Quartet Two 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:
Phang Thim Fatt
8 Shenton Way #18-01
Singapore 068811
SOLUS CORE FUND: Placed Under Voluntary Wind-Up
-----------------------------------------------
On Jan. 1, 2014, the sole shareholder of Solus Core Opportunities
Fund Ltd resolved to voluntarily wind up the company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 18, 2014, will be included in the company's dividend
distribution.
The company's liquidator is:
Ogier
c/o Jo-Anne Maher
Telephone: (345) 815-1762
Facsimile: (345) 949-9877
89 Nexus Way, Camana Bay
Grand Cayman KY1-9007
Cayman Islands
SOLUS CORE INTERMEDIATE: Placed Under Voluntary Wind-Up
-------------------------------------------------------
On Jan. 1, 2014, the sole shareholder of Solus Core Opportunities
Intermediate Fund Ltd resolved to voluntarily wind up the
company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 18, 2014, will be included in the company's dividend
distribution.
The company's liquidator is:
Ogier
c/o Jo-Anne Maher
Telephone: (345) 815-1762
Facsimile: (345) 949-9877
89 Nexus Way, Camana Bay
Grand Cayman KY1-9007
Cayman Islands
VISUAL CHINA: Placed Under Voluntary Wind-Up
--------------------------------------------
On Dec. 31, 2013, the shareholder of Visual China Holding Limited
resolved to voluntarily wind up the company's operations.
Only creditors who were able to file their proofs of debt by
Feb. 19, 2014, will be included in the company's dividend
distribution.
The company's liquidator is:
Leung, Ming Shu
Dian Tong Creative Square
Building 2, Area A, No. 7
Jiuxianqiao North Street
Chaoyang District, Beijing 100015
China
Telephone: +8610 57950333
Facsimile: +8610 56920112
=========
C H I L E
=========
* CHILE: Fitch Publishes 2014 Outlook for Corporate Sector
----------------------------------------------------------
Fitch Ratings has published its 2014 Outlook for the Chilean
Corporate Sector. The report provides Fitch's Outlook for Chile's
energy, mining, forestry, telecommunications, construction,
retail, food & beverage, wine, and health sectors. Fitch's
outlook for these sectors is stable, with the exception of the
construction sector, which has a negative outlook.
Fitch's Chilean corporate rating portfolio comprises 83 companies,
71 of which have been assigned long-term debt ratings on a
national and/or international scale, while the remaining 12 have
been assigned only equity ratings. Of the companies with debt
ratings, 63 have Stable Rating Outlooks, six have Negative
Outlooks, one has a Positive Outlook, and one is on Rating Watch
Evolving.
A key credit risk of Fitch-rated companies is debt financed
expansion activities and acquisitions. Nonetheless, Fitch expects
companies to focus on consolidating recent investments and
boosting profitability to strengthen credit profiles in 2014. The
latter is consistent with a scenario of more moderate growth, high
energy and labor costs, and tax reform. Uncertainties surrounding
environmental issues remain a risk for sectors such as energy and
mining.
=============
J A M A I C A
=============
UC RUSAL: Bullish on Aluminum Sector Growth
-------------------------------------------
RJR News reports that UC Rusal is claiming that global aluminum
demand will rise six percent this year.
The company said this will stretch supplies following production
cutbacks, according to RJR News.
The report notes that UC Rusal Chief Executive Officer Oleg
Deripaska expects demand growth to accelerate amid positive
signals of returning confidence across all key sectors and
markets.
Mr. Deripaska said, the report notes, that China and other Asian
economies are expected to grow strongly and developed markets
including the US and Europe should continue to show a healthy
growth.
UC Rusal controls 65 per cent of Jamaica's alumina production
capacity and operates three of the island's four alumina
refineries.
* * *
As reported in the Troubled Company Reporter-Latin America on
April 25, 2013, RJR News said UC Rusal disclosed its financial
losses for 2012 were bigger than initially reported. The company
has revised its net loss to US$337 million from the US$55 million
US dollar loss reported the previous month, according to RJR News.
The report related that UC Rusal said the adjustment was made
after reviewing its share of profit from its subsidiary Norilsk
Nickel. UC Rusal, the report added, said the adjusted financial
statements have been reviewed by its auditor.
===========
M E X I C O
===========
HSBC MEXICO: Moody's Puts 'B3' Rating of 3 Class Certs. on Review
-----------------------------------------------------------------
Moody's de Mexico has placed on review for possible upgrade three
residential mortgage backed securitizations (RMBS) serviced by
Patrimonio, S.A. de C.V., SOFOM, E.N.R. This rating action follows
the recent placement on review for possible upgrade of the ratings
of the financial guarantor MBIA Insurance Corporation (MBIA) and
MBIA Mexico (MBIA Mexico).
The rating action is as follows:
Issuer: HSBC Mexico, S.A., Institucion de Banca Multiple, Grupo
Financiero HSBC, Division Fiduciaria, acting solely as trustee.
MXMACFW 07-3U Class A, B3 (sf) (Global Scale, Local Currency) and
B1.mx (sf) (Mexican National Scale) placed on review for possible
upgrade. The certificates' underlying ratings (reflecting the
certificates' intrinsic credit quality absent the financial
guarantee that MBIA provides) are Ca (sf) and Ca.mx (sf).
MXMACFW 07-5U Class A, B3 (sf) (Global Scale, Local Currency) and
B1.mx (sf) (Mexican National Scale) placed on review for possible
upgrade. The certificates' underlying ratings (reflecting the
certificates' intrinsic credit quality absent the financial
guarantee that MBIA Mexico provides) are C (sf) and C.mx (sf).
BRHCCB 07-2U Class A-2, B3 (sf) (Global Scale, Local Currency)
and B1.mx (sf) (Mexican National Scale) placed on review for
possible upgrade. The certificates' underlying ratings (reflecting
the certificates' intrinsic credit quality absent the financial
guarantee that MBIA Mexico provides) are Ca (sf) and Ca.mx (sf).
Ratings Rationale
This action is solely driven by Moody's announcement on February
14, 2014 that it has placed on review for possible upgrade the
Insurance Financial Strength (IFS) ratings of MBIA Insurance
Corporation (MBIA Corp.), and of MBIA Mexico.
MXMACFW 07-3U benefits from a financial guaranty insurance policy
issued by MBIA Insurance Corp., while MXMACFW 07-5U and BRHCCB 07-
2U benefit from a similar guaranty issued by MBIA Mexico, that
covers timely interest payment and ultimate principal payment by
the legal final maturity date of the certificates.
The certificates' current ratings are consistent with Moody's
modified approach to rating structured finance securities wrapped
by financial guarantors at the higher of (1) the guarantor's
insurance financial strength rating and (2) the underlying
ratings, which reflect the intrinsic credit quality of the
certificates in the absence of the guarantee. In the case of
MXMACFW 07-3U Class A, MXMACFW 07-5U Class A and BRHCCB 07-2U
Class A-2, since MBIA's financial strength ratings are higher than
the certificates' underlying ratings, the certificates' ratings
are in line with MBIA's current ratings.
As part of evaluating the current ratings of these transactions,
Moody's also reviewed the certificates' underlying ratings, which
are as follows:
MXMACFW07-3U Class A: Ca.mx (sf), Ca (sf)
MXMACFW07-5U Class A: C.mx (sf), C (sf)
BRHCCB 07-2U Class A-2: Ca.mx (sf), Ca (sf)
Any change in MBIA's insurance financial strength rating would
result in a change in the ratings of the certificates.
Factors that would lead to an upgrade or downgrade of the rating
Given the low underlying ratings of the certificates compared to
the guarantor's rating, the ratings are directly affected by any
change in the insurance financial strength of the guarantor.
With respect to the underlying ratings, the primary sources of
uncertainty are related to the macroeconomic environment,
particularly regarding the dynamics of the labor market, and the
severity of loss assumption for defaulted loans.
Moody's considers servicing and origination practices in its
analysis; the assessment of these practices informs some of the
transaction's assumptions.
Rating Methodology
The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS using the MILAN Framework" published in
November 2013.
This action is driven solely by the rating action on MBIA and is
not a result of change in key assumptions, expected losses, cash
flows and stress scenarios on the underlying assets.
The period of time covered in the financial information used to
determine the listed deals' ratings is between March 31, 2007 and
November 30, 2013. (source: periodic collections and remittances
reports sent by the servicers, trustees and common representative
agents)
The transactions are backed by residential mortgage loans granted
to middle and low income borrowers, denominated in UDIS. The
analysis of the collateral is performed under the MILAN
methodology, which take into account the characteristics of the
loans in order to assess potential losses on the structures.
SUL AMERICA: S&P Lowers LT Counterparty Credit Rating to 'BBB'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its global scale long-
term counterparty credit rating on Sul America Cia Nacional de
Seguros S.A. (Sul America) to 'BBB' from 'BBB+'. S&P also lowered
the global scale long-term counterparty credit rating on Sul
America's holding company, Sul America S.A. (SASA), to 'BB+' from
'BBB-'. S&P is removing the global scale ratings from CreditWatch
where it placed them with negative implications on Nov. 26, 2013.
S&P is affirming the 'brAAA' national scale rating on Sul America
and the 'brAA+' national scale rating on SASA. The outlook on the
global scale ratings is negative. The outlook on the national
scale rating on Sul America is stable. S&P has revised the
outlook on the national scale rating on SASA to negative.
"The negative outlook on the global scale ratings reflects that on
the sovereign. We expect Sul America to maintain its strong
competitive position, consistent operating performance, and
'intermediate' risk position, said Standard & Poor's credit
analyst Gabriela Sebrell.
A downgrade is possible if:
-- S&P downgrades Brazil;
-- Sul America's capitalization approaches the regulator's
minimum required capital level; or
-- Liquidity ratio falls below 100%, according to S&P's risk
based model.
A positive rating action is unlikely given the sovereign rating
and outlook on it. S&P may consider an upgrade if, within the
next few years, the company establishes policies or investment
strategies, which would allow it to withstand sovereign stress.
===============
P A R A G U A Y
===============
* PARAGUAY: IMF Exec. Board Concludes 2013 Article IV Consultation
------------------------------------------------------------------
On February 14, 2014, the Executive Board of the International
Monetary Fund (IMF) concluded the Article IV Consultation with
Paraguay.
Background
Paraguay enjoyed robust economic growth in the past decade, on the
heels of the export commodity boom, and supported by prudent
macroeconomic policy implementation. Despite weather-related
shocks hitting the key agribusiness sector, the economy has grown
at an average rate of 4.7 percent a year since 2003 compared with
about 2 percent the previous decade. Robust growth has been
accompanied by declining inflation, particularly since 2011 when
the central bank adopted inflation targeting. Despite the
acceleration in growth in the 2000s, poverty and inequality in
Paraguay remain among the highest in the region.
Activity rebounded to an estimated 13 percent in 2013 as the
agricultural sector recovered sharply from the previous year's
severe drought. Rising agricultural output led to higher exports
and a surplus of close to 1 percent of GDP in the external current
account, despite a deterioration in the terms of trade. Non-
agricultural activity has been less volatile, growing at about
potential in the past two years, underpinned by rising
consumption. End-2013 inflation fell to 3.7 percent - below the
central bank's inflation target rate of 5 percent - despite
increasing food prices. Private sector credit growth has slowed
to about 17 percent in nominal terms since end-2012, with loans
concentrated on the agricultural sector; consumer credit has also
grown rapidly, albeit from a low base. Paraguay's banking sector
remains well capitalized and profitable, with low nonperforming
loans.
Macroeconomic policies broadly supported the recovery. Fiscal
spending under the stimulus implemented in 2012 decelerated in
2013 due to stricter spending controls, though the central
government deficit increased slightly to about 2 percent of GDP
from 1.8 percent in 2012 as tax revenue remained modest. Monetary
policy was on hold during much of 2013 until the central bank
raised the policy rate by 100 basis points over December 2013 and
January 2014, in light of incipient inflationary pressures.
The outlook for 2014 is positive. Growth should be strong at 4.8
percent, underpinned by continued dynamism in the agricultural
sector and rising infrastructure investment. Annual inflation
will likely increase to the central bank's target rate of 5
percent. The fiscal deficit should remain low, under the
introduction of the recently approved Fiscal Responsibility Law.
The external current balance would revert to a small deficit amid
slightly deteriorating terms of trade and rising import volumes.
Overall, the risks to this outlook are balanced. The main
downside risks stem from regional growth and global borrowing
conditions, while upside risks include faster-than-expected
progress in reforms.
Executive Board Assessment
Executive Directors welcomed Paraguay's recent economic recovery
and favorable outlook, underpinned by strong economic policies and
fundamentals, with low debt, sizeable official reserves, and small
fiscal and external imbalances. Directors noted that the key
challenge ahead is to improve social and economic development,
while strengthening the macroeconomic policy framework. They took
positive note of the authorities' ambitious reform agenda and the
critical legislation that has already been enacted to address
institutional and structural weaknesses. Directors emphasized
that resolute implementation of these laws and continued sound
macroeconomic policies are necessary to reduce poverty and foster
broad-based sustainable growth.
Directors welcomed the strengthening of the fiscal framework. The
fiscal responsibility law provides a sound anchor to underpin
fiscal sustainability. They encouraged the authorities to make
the framework stronger, by further improving the quality of
government spending, strengthening tax and customs administration,
and enhancing the capacity to deal with potential risks from
public-private partnerships. Civil service and pension reforms
are also needed.
Directors welcomed the authorities' prudent monetary policy stance
and the advances made in implementing an inflation-targeting
regime. They encouraged additional steps to complete the
transition towards a full-fledged inflation-targeting regime,
including developing an active interbank money market,
strengthening risk-based bank supervision, and updating financial
sector legislation. Maintaining exchange rate flexibility and
greater efforts to reduce dollarization will strengthen the
monetary policy framework and help cushion the economy against
potential shocks. Over the medium term, macroeconomic policies
should be guided by the fiscal responsibility law and inflation-
targeting frameworks. Directors called for steps to address the
remaining deficiencies in the anti-money laundering regime.
Directors agreed that reducing poverty and inequality is a
priority.
They encouraged the authorities to sustain all the initiatives
underway to promote social and economic inclusion while protecting
vulnerable groups through social safety nets. Reform efforts
should particularly focus on improving the business climate,
addressing labor market inefficiencies, and increasing female
labor participation as well as human capital investment. Improved
public enterprises management will also facilitate access to basic
public services at reasonable cost.
=======
P E R U
=======
GRUPO ACP: Fitch Says Asset Sale No Immediate Effect on 'B' Rating
------------------------------------------------------------------
Fitch Ratings does not expect to take any immediate rating action
on Grupo ACP Inversiones y Desarrollo (ACP, rated 'B'/Outlook
Negative) following the company's announcement of an impending
asset sale. On Feb. 10, ACP announced that it has agreed to sell
its controlling stake in MiBanco Banco de la Microempresa
(Mibanco) to a subsidiary of Banco de Credito del Peru (BCP, rated
'BBB+'/Outlook Stable).
In addition to the recently announced sale, ACP also previously
agreed to sell a stake of Banco Sol in Bolivia. Both of these
operations need to obtain regulatory approval in Peru and Bolivia
and are expected to reach completion later this year.
The expected proceeds (USD 199 million) and current cash holdings
will be used to fully pay ACP's USD85 million 2011 senior bond
issuance and all of its remaining debt of approximately USD65
million. Thus the repayment risk for ACP's creditors has
declined, and once the transaction is closed the group's
liabilities will be eliminated. However, as is the case with
other financial holding companies, the divestment of ACP's core
productive investment will severely reduce its cash flow
generation capacity once the transaction is completed.
In Fitch's view, even though the repayment risk of ACP's current
debt has been reduced by the cash to be received, ACP's ratings
('B'/Outlook Negative) still reflect limited ability to generate a
well-balanced and sustainable cash flow to service its current
obligations and to cover its current level of operating expenses.
Once the transaction is completed, the company's liabilities will
be eliminated, but its ability to generate enough cash flow to
fulfill its cash needs over the medium term will be lower. Fitch
will re-assess ACP's ratings at that time and will also consider
the final composition of ACP's investment portfolio in terms of
diversification, ownership and structure.
For BCP this transaction will further strengthen its already
dominant position in the Peruvian market, giving it the highest
market share and the strongest franchise in a fiercely competitive
segment. Once the regulatory approvals are secured and the
transaction closed, Mibanco/Edyficar will have a 19.5% market
share. The relatively modest multiple paid for the acquisition
and small size of the transaction should have a negligible impact
on BCP's financial standing while providing an interesting upside
in the microfinance sector over the medium term.
=================
X X X X X X X X X
=================
LATAM: Fitch Sees Deficit-Driven Increase in 2014 Financing Needs
-----------------------------------------------------------------
Latin American government borrowing requirements are forecasted to
increase by 9% to USD491 billion in 2014, or 8.4% of regional GDP,
according to a Fitch Ratings report published Feb. 19, 2014. Most
of the uplift will finance an expansion in fiscal deficits, and
only a marginal fraction will be used to rollover existing debt.
More than half of the countries in Latin America will experience
an increase in their budget gaps, with Mexico and Brazil, the two
largest economies, expected to make the greatest contribution to
the region's fiscal deterioration in 2014.
A faster than expected economic slowdown and spending pressures
amid a heavy electoral calendar represent the main downside risks
for fiscal accounts and overall financing needs. Growth prospects
and fiscal revenue could be hampered by renewed weakness in the
U.S., a faster than expected deceleration in China and softer
commodity prices. Contested presidential and legislative
elections being held in seven countries of the region could lead
to higher public spending in 2014.
'Commodity exporters with a record of prudent fiscal management
will have the lowest borrowing requirements in 2014,' said Shelly
Shetty, Head of Fitch's Latin America Sovereign Group. Bolivia,
Chile, Guatemala, Paraguay, Peru and Uruguay stand out with
funding needs that are less than half the regional median of 6.1%
of GDP.
'Fitch considers that public finance is a credit strength for the
majority of these sovereigns relative to their ratings peers due
to their favorable fiscal trajectory, improving debt dynamics and
light amortization schedules,' added Shetty.
On the other hand, financing needs will exceed 9% of GDP in
Argentina, Brazil, Costa Rica and Mexico. These countries face
widening deficits and hefty amortisations. Large Treasury bill
rollovers in El Salvador and maturities on multilateral loans in
Dominican Republic will also keep their sovereign financing needs
well above the regional median in 2014.
Fitch forecasts that external bond supply will fall to USD17.3
billion in 2014, USD6.8 billion lower than in 2013. Lower
external amortisations, continued bond market development,
increased non-resident participation in local markets and less
benign international financing conditions could accentuate the
drive towards domestic financing.
Latin American investment-grade sovereigns are likely to adopt an
opportunistic approach to international issuance and use recent
rating upgrades to lock in low yields, extend maturities and
enhance the liquidity of their global benchmarks. However,
external issuance will be a key source of funding for speculative-
grade sovereigns. Bond supply by countries rated in the 'BB' and
'B' categories could reach 35% of expected issuance in the region,
a 15% increase in nominal terms versus 2013.
'While investment grade countries are well positioned to weather a
change in international liquidity conditions, lower-rated
sovereigns with heavy debt interest payment burdens, particularly
in Central America and the Caribbean, will be more vulnerable to
shifts in market sentiment and capital flows resulting from the
U.S. Federal Reserve tapering,' said Cesar Arias, Associate
Director in Fitch's Latin America Sovereign Group.
***********
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.
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., 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
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$775 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 A. Chapman at 215-945-7000 or Nina Novak at
202-241-8200.
* * * End of Transmission * * *