/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/150513.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 Wednesday, May 13, 2015, Vol. 16, No. 093 Headlines A N T I G U A & B A R B U D A ANTIGUA & BARBUDA: Another Meeting Scheduled for Bank Workers LIAT: High Winds Affecting Flights B R A Z I L BANCO VOTORANTIM: Moody's Cuts BCA Rating to ba1 BRAZIL: Analysts Expect Economy to Contract 1.2% CIMENTO TUPI: S&P Lowers Rating to 'CC' & Puts on CreditWatch Neg. CIMENTO TUPI: Fitch Cuts FC Issuer Default Rating to 'C' HYPERMARCAS SA: Potential Sale of Diapers Business is Credit Pos. PETROLEO BRASILEIRO: Said to Attract Mitsui in Gas Pipeline Sale C A Y M A N I S L A N D S 2020 GLOBALGROWTH: Shareholders' Final Meeting Set for May 28 ABYDOS FUND: Shareholders' Final Meeting Set for June 3 ABYDOS MASTER: Shareholders' Final Meeting Set for June 3 ACQUITY GROUP: Shareholders' Final Meeting Set for May 28 LANDMARK CDO: Members' Final Meeting Set for May 25 MONSOON INDIA: Shareholders' Final Meeting Set for June 3 OPUS COMMODITIES: Shareholders' Final Meeting Set for May 28 SI INTERNATIONAL: Shareholders' Final Meeting Set for June 3 SOLAR NXP: Shareholders' Final Meeting Set for June 3 TIGER GLOBAL XI: Shareholders' Final Meeting Set for May 29 TIGER GLOBAL XII: Shareholders' Final Meeting Set for May 29 D O M I N I C A N R E P U B L I C * DOMINICAN REPUBLIC: April Prices Fall -0.25%, Paced by Foods * DOMINICAN REP: Raise Wages, Avert Social Unrest, Bishop Warns H O N D U R A S HONDURAS: Moody's Alters Gov't. Bond Ratings Outlook to Positive M E X I C O GRUPO SENDA: Fitch Affirms 'B' Issuer Default Ratings MATAMOROS MUNICIPALITY: Moody's Withdraws Ba1 Issuer Rating SU CASITA: Fitch Affirms 'D(mex)' Nat'l LT Rating on Class B Notes - - - - - =============================== A N T I G U A & B A R B U D A =============================== ANTIGUA & BARBUDA: Another Meeting Scheduled for Bank Workers ------------------------------------------------------------- The Daily Observer reports that bank workers are contemplating action that could totally shut down the financial sector in Antigua & Barbuda if their concerns regarding the proposed Banking Bill of 2015 are not addressed. The general public got a taste of what that would be like last May 11, when hundreds of workers were off the job for several hours, from 8:00 a.m., to attend a meeting called by their bargaining agent, the Antigua & Barbuda Workers Union (A&BWU), according to The Daily Observer. The report notes that the action seriously affected customers as five of the eight financial institutions were forced to close, while each of the other three operated with a skeleton staff. The union's General Secretary David Massiah said the workers were asked to return to A&BWU's headquarters on Newgate Street on July 12, at 8:00 a.m., for a second strategy meeting, the report relays. One of the union's legal advisors was to be present at the meeting, the report discloses. On May 11, employees attended the early morning meeting called by their bargaining agent to update them on the outcome of talks with Attorney General Steadroy "Cutie" Benjamin on the matter. Workers in the banking sector along with their union are agitating for a change in how their severance is addressed in the proposed legislation which was debated and passed in the Upper House May 11, the report relays. Mr. Massiah said during the two-and-a-half-hour meeting, the workers flatly rejected Benjamin's suggestion that the Bill be allowed to pass and he (Benjamin) will return to Parliament to make the amendments within a six-week period, the report notes. "We are concerned because the very Bill says that for any amendments to be made once the Bill is passed it would require approval by the Eastern Caribbean Currency Union (ECCU)," the report quoted Mr. Massiah as saying. Mr. Massiah said the workers are still not satisfied and will continue to agitate, the report relays. "The workers are still of the view they would like the matter of severance addressed in having it properly outlined rather than joining it with other parts of a sentence which could have a different meaning," the general secretary said, the report notes. Although the closure lasted for only a few hours it had a ripple effect of on business and commerce in the country, as many people were unable to conduct their usual transactions, the report discloses. It was shortly after mid-day when the doors of several financial institutions namely; Royal Bank of Canada, Antigua Commercial Bank, Eastern Caribbean Amalgamated Bank, CIBCFirstCaribbean International, Bank of Nova Scotia Woods Mall branch and the Antigua & Barbuda Development Bank opened for business, the report adds. * * * As reported in the Troubled Company Reporter-Latin America on September 23, 2014, The Daily Observer said that Antigua & Barbuda could soon find itself in the company of Japan, Zimbabwe, and Greece, the countries with the highest national debts. In the January 2014 budget presentation, the former administration indicated that the nation's debt was 87 per cent of GDP, according to The Daily Observer. However, Prime Minister Gaston Browne has disputed the figure, deeming it to be as high as 130 per cent, the report noted. Minister Browne said while his government's increased borrowing is pushing up the nation's debt-to-GDP ratio, it is necessary to solve the country's problems, the report related. LIAT: High Winds Affecting Flights ---------------------------------- The Daily Observer reports that travelers on regional carrier LIAT, operating as Leeward Islands Air Transport, should expect increased flight cancellations in the coming months due to high winds according to the company. The destinations most affected will be Dominica and St. Vincent & the Grenadines, according to The Daily Observer. The report notes that a release from the company says their aircrafts are not permitted to take off or land when the prevailing winds are beyond certain limits. As such, flights out of E. T. Joshua Airport and night landings into Douglas-Charles Airport may be cancelled in the interest of safety, the report relays. Customers traveling to/from both countries are advised of the possibility of cancelled flights and delayed baggage, the report notes. LIAT will be forced to restrict the number of bags on the aircraft as the wind conditions in both Dominica and St. Vincent restrict the take-off weight of the company's aircraft, the report relays. LIAT said its Reservations and Airport personnel are ready to assist customers affected by any cancellations and baggage issues, the report notes. The high winds are expected to last until mid-June, the report adds. About LIAT LIAT, operating as Leeward Islands Air Transport, is an airline headquartered on the grounds of V. C. Bird International Airport in Antigua. It operates high-frequency inter-island scheduled services serving 21 destinations in the Caribbean. The airline's main base is VC Bird International Airport, Antigua and Barbuda, with bases at Grantley Adams International Airport, Barbados and Piarco International Airport, Trinidad and Tobago. * * * As reported in the Troubled Company Reporter-Latin America on Dec. 2, 2014, Caribbean360.com said that chairman of the shareholder governments of the financially troubled regional airline, LIAT, operating as Leeward Islands Air Transport, Dr. Ralph Gonsalves said while he is unaware of the details regarding any possible retrenchment of employees, the airline needs to deal with its high cost of operations. The TCR-LA on March 10, 2014, citing Caribbean360.com, reported that LIAT said it will take "decisive action" to deal with unprofitable routes as the Antigua-based airline seeks to make its operations financially viable. On Sept. 23, 2013, the TCRLA, citing Trinidad and Tobago Newsday, reported that there's much upheaval at the highest levels of LIAT -- the Board and the Executive. Following the sudden resignation of Chief Executive Officer Captain Ian Brunton, David Evans replaced Mr. Brunton as chief executive officer =========== B R A Z I L =========== BANCO VOTORANTIM: Moody's Cuts BCA Rating to ba1 ------------------------------------------------ Moody's Investors Service downgraded by one notch the long-term local currency deposit ratings of five Brazilian banks, including Banco Bradesco S.A., Itau Unibanco S.A., Banco Itau BBA S.A., HSBC Bank Brasil -- Banco Multiplo S.A., and Banco Votorantim S.A. and upgraded by one notch the long-term local currency deposit rating of Banco BBM S.A., following the conclusion of the rating agency's review initiated on 17 March 2015, prompted by the publication of its new Banks methodology (see "Banks" published on March 16, 2015). At the same time, Moody's lowered the baseline credit assessments (BCAs) of six banks, and raised the BCAs of three banks to reflect the implementation of the new bank methodology. Moody's has also assigned, where relevant, a counterparty risk (CR) assessment. In general, the rating changes do not reflect either an improvement or a deterioration in the affected issuers' credit fundamentals. Rather, the changes are a consequence of the implementation of our new bank methodology, which highlighted these issuers as being either positive or negative outliers at their previous rating levels. Moody's considers these issuers to be more appropriately positioned at their current revised rating levels. Moody's has withdrawn the outlooks on all junior instrument ratings covered in this press release. It has withdrawn these outlooks for its own business reasons. Please refer to Moody's Investors Service's Policy for Withdrawal of Credit Ratings, available on its website, www.moodys.com. Outlooks are now only assigned to long-term senior debt and deposit ratings, indicating the direction of any rating pressures. A list of the affected credit ratings is available at http://is.gd/2WfmX8 The conclusion of the reviews follows Moody's publication of its updated bank rating methodology. The revised methodology, "Banks", contains new aspects that Moody's has devised in order to help accurately predict bank failures and determine how each creditor class is likely to be treated when a bank fails and enters resolution. The new aspects capture insights gained from the crisis and the fundamental shift in the banking industry and its regulation. Banco Bradesco And Itau Unibanco's Ratings Lowered; Negative Outlook Reflects Sovereign Constraint The downgrades of the global scale senior unsecured debt and deposit ratings of Banco Bradesco S.A. (Bradesco), Itau Unibanco S.A. (Itau Unibanco), and Banco Itau BBA S.A. (Itau BBA) to Baa2 from Baa1 followed the reduction of their BCAs to equivalent levels. Notwithstanding the downgrade of the banks' global scale ratings, their Brazilian long-term national scale deposit ratings were affirmed at Aaa.br. These changes primarily considered the banks' adjusted capitalization levels, which compare unfavorably with global peers, notwithstanding reported capital ratios that are considerably stronger and that provide sizeable cushions relative to the minimum regulatory requirements in Brazil. Moody's ratio of Tangible Common Equity to Risk-Weighted Assets is designed to provide a globally consistent measure of capitalization and thereby enhance the comparability of banks operating under different regulatory regimes. Our ratio, which has an important weight in our new methodology, closely mirrors Basel III guidelines and is stricter in many respects than the current Brazilian standard. While their capital scores are low by this measure, Moody's acknowledge these banks' consistent capital replenishment ability through recurring internal revenues generation, which is supported by their high degree of revenue diversification, their dominant market positions as the two largest private sector banks in the country, and strong risk management. The banks also exhibit low asset risk supported by moderate levels of nonperforming loans and conservative reserve buffers that should help to shield their capital positions from any unexpected asset quality deterioration. The ratings are also supported by the banks' strong liquidity profiles, characterized by ample liquid resources, large core deposit bases, and well established market access. The negative outlooks on these banks' global ratings are in line with the negative outlook on the government of Brazil's Baa2 sovereign bond rating. Both banks have high direct exposure to the country's creditworthiness through their sizeable holdings of government securities. In addition, their lending books are highly exposed to the Brazilian economy. Notwithstanding Itau Unibanco's growing presence in the rest of Latin America, and both banks' important non-credit earnings, that reduce earnings volatility during challenging risk environments, Bradesco and Itau Unibanco still have limited geographic earnings diversification. These linkages constrain the banks' BCAs to the sovereign bond rating. Thus, a downgrade of the sovereign is likely to result in a further downgrade of the banks' ratings as well. The downgrade of Itau Unibanco Holding S.A.'s local currency issuer and senior unsecured debt ratings to Baa3, from Baa2, reflects the reduction of its subsidiaries' BCAs to baa2. Itau Unibanco Holding's ratings are notched down from the BCAs of Itau Unibanco and Itau BBA to reflect structural subordination. The holding company's Tier 2 subordinated securities remain at Baa3 to reflect our view that the higher loss severity of a subordinated bond is fully captured by a one-notch downward adjustment from the bank subsidiaries' BCA. Ratings of HSBC Brazil and Banco Votorantim Lowered as well; Negative Outlooks Consider Performance Risks: HSBC Brazil In lowering the unsupported BCA of HSBC Bank Brasil -- Banco Multiplo S.A. (HSBC Brazil) to baa3, from baa2, Moody's notes the bank's poor profitability, low adjusted capitalization levels as measured by Moody's ratio of Tangible Common Equity to Risk- Weighted Assets, and large volume of market funding, which is mainly used to meet the Group's internal liquidity requirements. After two years of declining profits and market share, the bank reported net losses in 2014. Driven mostly by increases in interest expenses on deposits, these losses further weakened HSBC Brazil's already low capitalization. Notwithstanding these credit challenges, the bank continues to benefit from a relatively low nonperforming loan ratio, substantial loan loss reserves, and a high level of liquid resources. Moody's also lowered HSBC Brazil's Adjusted BCA by one notch to a2 and downgraded the long-term global local currency deposit ratings to A2, which incorporates four-notches of uplift based on our assessment of very high likelihood of support from the bank's UK- based parent HSBC Holdings plc (Aa3 review for downgrade). The bank's other ratings, including its Aaa.br national scale deposit rating, its foreign currency debt and deposit ratings, and its short-term ratings, were affirmed. The negative outlook on HSBC Brazil's ratings reflects the bank's significant challenge to revert losses and expand operations, particularly in the scenario of negative growth that Moody's anticipates for Brazil's economy in 2015. Banco Votorantim The reduction of Banco Votorantim's (BV) BCA to ba1 from baa3 reflects the bank's weak capitalization, high dependence on market funds, modest profitability, and relatively high asset risk, counterbalanced by a high level of liquid resources. BV's adjusted capital ratio is constrained by its large deferred tax asset position, which resulted in a tangible common equity to risk- weighted assets ratio of just 3.8% as of December 2014. However, Moody's expects the bank to continue to rationalize its balance sheet growth and retain the majority of its earnings, which will lead to gradual improvements in its capitalization. BV's asset risk is characterized by a concentration in vehicles loans with a high but declining level of nonperforming loans as a result of the enhanced underwriting standards the bank has been applying over the last few years. After posting a net loss in 2013 driven by high loan loss provisions, the bank achieved a meaningful turnaround in its profitability in 2014, though earnings remain low. While the bank's funding profile is highly dependent on the wholesale segment and is consequently exposed to refinancing risk, it asset and liability tenors are well matched and it receives significant funding from Banco do Brasil, its 50% shareholder, which purchases BV's consumer loan securitizations. BV's ample liquid resources are supplemented by a BRL7.0 billion committed facility provided by BB as well. As a result of the reduction in BV's BCA, Moody's downgraded the bank's long-term global scale deposit and senior debt ratings to Baa3 from Baa2, its short-term ratings to P-3 from P-2, and its long-term Brazilian national scale deposit rating to Aa1.br from Aaa.br. The Baa3 rating incorporates one notch of uplift from the bank's ba1 BCA, which results from Moody's view of the high likelihood of support from Banco do Brasil S.A. (BCA of baa3). BV's ba1 BCA incorporates our expectation that profitability will continue to recover, asset risk will continue to decline, and capitalization will improve. The negative outlook on BV's ratings reflects the risk that these expectations may not be fulfilled as a result of the weak economic environment. Banco do Brasil's bca Lowered But Ratings Affirmed: The reduction of Banco do Brasil's (BB) BCA to baa3 from baa2 reflects BB's weak capital position, despite its strong funding structure and sound asset risk profile, profitability, and liquidity. While BB's tangible common equity was at just 7.0% of risk-weighted assets as of December 2014, Moody's expects the bank to reduce its pace of loan growth in 2015, which will reduce pressure on its capitalization. BB's funding profile is the bank's key strength, reflecting its granular deposit funding base and stable long-term funding from government-related entities. Asset risk is supported by its historically low non-performing loan ratio and relatively high loan loss reserve coverage, but limited to the bank's rapid expansion over the last few years coupled with its significant exposure to the agricultural sector, although Moody's notes that this industry is currently experiencing some favorable momentum. Supported by its earnings diversification, with significant contributions from service fees and insurance revenues, Moody's expects the bank's profitability to stabilize after several years of declines. Despite the change in BB's BCA, Moody's has affirmed the bank's long-term global scale debt and deposit ratings of Baa2, and its long-term Brazilian national scale deposit rating of Aaa.br. These ratings benefit from our expectation that the government of Brazil will provide financial support to the bank if necessary. However, Moody's downgraded the preferred stock non-cumulative rating to Ba3(hyb) from Ba2(hyb), as this rating is positioned at the bank's BCA minus three notches and Moody's do not expect the government to support these specific obligations. The notching captures the risk of losses for investors from coupon suspension and principal write-down before the bank reaches the point of non-viability. BCAs Raised: Banco Ford, Banco de Brasilia, and Banco BBM: Moody's increased by one notch the standalone BCAs of Banco Ford S.A., BRB-Banco de Brasilia S.A. and Banco BBM. In addition, Moody's upgraded the debt and deposit ratings of Banco BBM S.A.. The ratings of Banco Ford and Banco de Brasilia were affirmed. The outlooks on these issuers are stable. As previously indicated, these changes do not reflect an improvement in the issuers' fundamentals. Rather, they are the result of the implementation of the new methodology, which highlighted them as being positive outliers at their previous rating levels. Banco Ford The increase of Banco Ford's BCA to ba2, from ba3, reflects the bank's strong profitability and low asset risk, notwithstanding its monoline business model focused entirely on auto loans. As a captive finance operation of Ford Motor Credit Company, LLC (FMCC, Baa3 stable) in Brazil, Banco Ford originates revenues mainly from working capital loans and inventory financing to Ford dealers. The bank has reported profitability ratios consistently better than those of its peers over the last several years, supported by a lean structure and low operating expenses. Low asset risk reflects the bank's stable track record of low loan delinquencies resulting from its close oversight of the financial performance of car dealers, coupled with large volumes of collateral. The increase of its BCA did not affect Banco Ford's Ba1 global local currency and foreign currency deposit ratings or its Aa1.br Brazilian national scale deposit ratings, which continue to benefit from a high probability of support from the bank's parent. Banco de Brasilia The increase of the BRB-Banco de Brasilia's (BRB) BCA to ba3 from b1 reflects the bank's strong funding profile, marked by a granular deposit base and very low reliance on market funds. The bank also benefits from adequate capitalization, profitability, and liquidity. However, BRB continues to exhibit high asset risk resulting from its geographic concentration in the Federal District region, as well as weak corporate governance, as reflected in frequent changes in senior management and continued political interference. The bank's asset risk profile has been hurt by the high pace of growth in its loan book over the last few years, with a focus on SME lending, an area in which it has little experience, which has led to a rising delinquency ratio. Notwithstanding the change in its BCA, BRB's deposit rating was affirmed at Ba3. Consequently, the BCA and deposit rating, which no longer benefit from parental support as the Government of Brasilia is unrated, are now equivalent. Moody's also affirmed BRB's long-term Brazilian national scale deposit rating of A2.br. Banco BBM The upgrade of Banco BBM's (BBM) deposit and senior debt ratings to Baa3 from Ba1 results from an equivalent improvement in its BCA. Moody's also upgraded the bank's long-term Brazilian national scale deposit rating to Aa1.br from Aa2.br. The changes reflect the bank's strong capital position and low asset risk, which are partially offset by a heavily dependence on market funding. BBM's strong asset risk profile is evidenced by its low historical non- performing loan ratios and reduced charge offs, supported by strict underwriting standards. While the bank has material exposures to both the sugar & alcohol and construction industries, these risks are mitigated by a high degree of collateralization. A strict internal cap on credit exposure sustains the bank's very strong capital ratios. Although BBM relies heavily on market funding, which exposes it to refinancing risk, it also holds a large amount of liquid assets and operates with a favorable tenor gap in its balance sheet. Assigning of Counterparty Risk Assessments: As part of the actions, Moody's has assigned a Counterparty Risk Assessment (CR Assessment) to nine banks. The CR Assessment reflects an issuer's probability of defaulting on certain bank operating liabilities and other contractual commitments, but it is not a rating. The CR Assessment takes into account the issuer's standalone strength as well as the likelihood of affiliate and government support in the event of need, reflecting the anticipated seniority of these obligations in the liabilities hierarchy. The CR Assessment also incorporates other steps authorities can take to preserve the key operations of a bank should it enter a resolution. The principal methodology used in these ratings was Banks published in March 2015. Moody's National Scale Credit Ratings (NSRs) are intended as relative measures of creditworthiness among debt issues and issuers within a country, enabling market participants to better differentiate relative risks. NSRs differ from Moody's global scale credit ratings in that they are not globally comparable with the full universe of Moody's rated entities, but only with NSRs for other rated debt issues and issuers within the same country. NSRs are designated by a ".nn" country modifier signifying the relevant country, as in ".za" for South Africa. For further information on Moody's approach to national scale credit ratings, please refer to Moody's Credit rating Methodology published in June 2014 entitled "Mapping Moody's National Scale Ratings to Global Scale Ratings". Last Rating Actions: Moody's took its last rating action on Banco Bradesco on March 17, 2015, when the rating agency placed on review for downgrade both the global local currency deposit and senior unsecured debt ratings of Baa1. The action followed implementation of the new bank methodology on 16 March 2015. The global short-term local currency deposit and the foreign currency deposit were affirmed. The Brazilian national scale ratings remained unchanged. Moody's took its last rating action on Itau Unibanco on March 17, 2015, when the rating agency placed both the global local currency deposit of Baa1 and senior unsecured program rating of (P)Baa1 on review for downgrade, following the implementation of the new bank methodology on 16 March 2015. The global short-term local currency deposit and the foreign currency deposit were affirmed. The Brazilian national scale ratings remained unchanged. Moody's took its last of rating action on Banco Itau BBA on March 17, 2015, when Moody's placed on review for downgrade both the global local currency deposit of Baa1 and senior unsecured program rating of (P)Baa1, following the implementation of the new bank methodology on 16 March 2015. The global short-term local currency deposit and the foreign currency deposit were affirmed. The Brazilian national scale ratings remained unchanged. Moody's took its last rating action on Itau Unibanco Holding on March 17, 2015, when Moody's placed on review for downgrade the local currency issuer and senior unsecured debt ratings of Baa2, following the announcement of the review of ratings assigned to its operating banks Itau Unibanco e Banco Itau BBA. The review of the ratings was triggered by the implementation of the new bank methodology on 16 March 2015. Simultaneously, the Baa3 foreign currency subordinated rating under the Cayman Islands Branch was placed on review for upgrade. The Brazilian national scale issuer ratings were also placed on review for downgrade. Moody's took its last rating action on Banco do Brasil on March 17, 2015, when the rating agency placed on review for downgrade the baa2 baseline credit assessment, following the implementation of the new bank methodology on March 16, 2015. At the same time, the preferred stock non-cumulative rating of Ba2(hyb) issued by Banco do Brasil through its Cayman Branch was also placed on review for downgrade. All other supported ratings remained unchanged, including the global local and foreign currency deposits as well as debt ratings assigned to both Banco do Brasil and Banco do Brasil Cayman Branch. The outlook on these ratings remained negative in line with the outlook of Brazil's government bond rating. Moody's took its last rating action on Banco Votorantim on March 17, 2015, when the rating agency placed on review for downgrade the baa3 baseline credit assessment, as well as the supported deposit and debt ratings assigned to both Banco Votorantim and also to Banco Votorantim Nassau Branch. The long-term national scale deposit rating of Aaa.br was also placed on review for downgrade. Moody's took its last rating action on HSBC Bank Brazil on March 17, 2015, when the rating agency placed on review for downgrade the bank's baa2 baseline credit assessment, as well as its supported global local currency deposit rating of A1. All other ratings remained unchanged. Moody's took its last rating action on Banco BBM on March 17, 2015, when the rating agency placed on review for upgrade the bank's ba1 baseline credit assessment, as well as the long- and short-term global local and foreign currency deposit ratings of Ba1 and Not Prime, respectively. The Brazilian national scale deposit ratings were also placed on review for possible upgrade. Moody's took its last rating action on Banco Ford on March 17, 2015, when the rating agency placed on review for upgrade the bank's ba3 baseline credit assessment. All other ratings remained unchanged. Moody's took its last rating action on Banco de Brasilia on March 17, 2015, when the rating agency placed on review for upgrade the bank's b1 baseline credit assessment. All other ratings remained unchanged. BRAZIL: Analysts Expect Economy to Contract 1.2% ------------------------------------------------ EFE News reports that analysts expect Brazil's gross domestic product (GDP) to contract 1.2 percent this year, the Central Bank said. The GDP estimate comes from the Boletin Focus, a weekly Central Bank survey of analysts from about 100 private financial institutions on the state of the national economy, according to EFE News. The report notes that the new estimate represents a worsening of the outlook for Brazil's economy, which analysts in the previous edition of the survey expected to contract by 1.18 percent. Analysts surveyed for the Boletin Focus expect Brazil to finish 2015 with an inflation rate of 8.29 percent, up from the 8.26 percent estimate released, the report relays. The inflation rate was 0.71 percent in April and came in at 4.56 percent during the first four months of this year, a figure that was above the government's target for the entire year, the report discloses. The government's official inflation target is 4.5 percent for the year, with a 2 percent band, the report says. Officials, however, have already acknowledged that the inflation number is going to come in higher than the target, the report notes. The report discloses that the government's draft budget guidance submitted to Congress last month was based on an 8.2 percent inflation projection. An inflation rate of more than 8 percent would be the highest since 2003, when prices surged 9.3 percent, the report says. Brazil finished 2014 with an inflation rate of 6.41 percent, well above the 5.91 percent rate registered in the prior year but below the top end of the government's range, the report discloses. Brazil's economy grew just 0.10 percent last year, compared to 2013, the report adds. CIMENTO TUPI: S&P Lowers Rating to 'CC' & Puts on CreditWatch Neg. ------------------------------------------------------------------ Standard & Poor's Ratings Services said that it has lowered its global scale rating on Cimento Tupi S.A. to 'CC' from 'CCC' and the national scale rating to 'brCC' from 'brCCC'. S&P also placed the ratings on CreditWatch negative. The downgrade reflects Cimento Tupi's missed $9 million interest payment on its 2018 notes due May 11, 2015. The notes establish a 30-day cure period for the payment. Although S&P believes there is a low probability that the company will make the payment during this period, currently there's a residual uncertainty over it. The negative CreditWatch listing reflects the residual uncertainty or risk that Cimento Tupi won't make the interest payment within the cure period. Once, and if, S&P believes that the interest payment on the 2018 notes won't be made within the grace period, S&P would downgrade Cimento Tupi to 'D'. CIMENTO TUPI: Fitch Cuts FC Issuer Default Rating to 'C' -------------------------------------------------------- Fitch Ratings has downgraded the following ratings of Cimento Tupi S.A. (Tupi): -- Foreign currency Issuer Default Rating (IDR) to 'C' from 'CCC'; -- Local currency IDR to 'C' from 'CCC'; -- Senior unsecured notes due 2018 to 'C/RR4' from 'CCC/RR4'; -- Long-term National Rating to 'C(bra)' from 'CCC(bra)'. KEY RATING DRIVERS The downgrade reflects Tupi's inability to pay its coupon payment which will enter a 30 day cure period on its outstanding notes. The company announced it will miss its USD9 million interest payment on its USD185 million of senior unsecured notes due in 2018. Tupi hired investment bank Rothschild as its investment advisor as the company seeks relief from its high level of interest expense amid a difficult operating environment. Fitch expects Tupi will have difficulty managing its debt service over the next six-12 months due to its strained cash position, low cash generating ability, and the weakening operating environment in Brazil that has increased refinancing risk for all Brazilian corporates. According to the IBGE's Monthly Industrial Survey, Brazilian cement production through February 2015 declined 8.9% due to the difficult operating conditions. Tupi's poor liquidity position has been persistent during the last 12 months and prospects are poor for improvement during 2015. The company is reliant on banks willingness to refinance its short- term maturities due to its low cash reserves. The levels of short- term debt coverage as measured by cash plus free cash flow (FCF)/short-term debt was -0.2x for latest 12 months (LTM) Sept. 30, 2014 compared to 0.0x at Dec. 31, 2013. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for the issuer include: -- Low single digit revenue growth; -- EBITDA margin between 20%-22%; -- Working capital of need of USD3 million; -- Capital expenditures of USD6 million; -- Net Leverage to remain above 7.0x in 2015; -- Limited improvement in liquidity position. RATING SENSITIVITIES Negative Rating Action: A downgrade would occur if Tupi does not make its bond payment during the 30 day cure period. Positive Rating Action: An upgrade is unlikely at this time given the company's difficulties meeting its payment obligations. HYPERMARCAS SA: Potential Sale of Diapers Business is Credit Pos. ----------------------------------------------------------------- Moody's Investors Service commented that the potential sale of diapers business is credit positive for Hypermarcas because it will potentially improve the company's leverage, increase the company's focus on the pharmaceutical segment, and reduce its exposure to dollar-linked costs. Hypermarcas carries LT Corporate Family Ratings (Foreign) at Ba2. PETROLEO BRASILEIRO: Said to Attract Mitsui in Gas Pipeline Sale ---------------------------------------------------------------- Jonathan Levin, Cristiane Lucchesi, and Yuriy Humber at Bloomberg News report that Petroleo Brasileiro SA has drawn interest from Mitsui & Co. in the sale of a package of natural gas pipelines, according to people with knowledge of the matter. Petrobras, as the Brazilian state oil company is known, has been marketing the sale of 49 percent of its stake in the pipelines, according to the people, who asked not to be identified discussing a private process, according to Bloomberg News. Mitsui is seen as a natural buyer of the assets because it's already a partner with Petrobras on gas pipelines, two of the people said. Still, talks between the companies are at a preliminary stage, the people said, Bloomberg News relates. The oil company has 9,000 kilometers (5,600 miles) of natural gas pipelines, according to its website. Mitsui, Japan's second- biggest trading house, has been active in Latin America's largest economy, including a deal in December to buy a stake in gas distribution company Cia. de Gas do Ceara, Bloomberg News notes. Bloomberg News says that Petrobras plans to divest about US$14 billion in assets by the end of next year to meet core investment goals and start addressing the oil industry's biggest debt load. The driller is also embroiled in a bribery scandal that led to the collapse of its stock and the replacement of then-Chief Executive Officer Maria das Gracas Foster with banker Aldemir Bendine, Bloomberg News relays. A representative for Mitsui said that the firm is generally interested in local gas distribution assets but hasn't bid on the Petrobras assets, Bloomberg News adds. About Petroleo Brasileiro Based in Rio de Janeiro, Brazil, Petroleo Brasileiro S.A. -- Petrobras (Brazilian Petroleum Corporation) -- explores for oil and gas and it produces, refines, purchases, and transports oil and gas products. The Company has proved reserves of about 14.1 billion barrels of oil equivalent and operates 16 refineries, an extensive pipeline network, and more than 8,000 gas stations. * * * As reported in the Troubled Company Reporter-Latin America on March 12, 2015, Moody's Investors Service said the corruption investigation into Petroleo Brasileiro S.A. (Petrobras) will negatively affect parts of the public and private sectors, but government support for the company is likely to help contain the credit-negative impact. On March 6, 2015, the TCLRA reported that the deepening investigation into the alleged kickback scheme at Petrobras has triggered concerns for the Brazilian banks with exposures not only to the state-controlled oil company, but also to its large base of suppliers, as well as the broader oil and gas (O&G) and construction industries, says Moody's Investors Service. Moody's Investors Service downgraded all ratings for Petrobras, including a downgrade of the company's senior unsecured debt to Ba2 from Baa3, and assigned a Ba2 Corporate Family Rating to the company, the TCRLA reported on Feb. 27, 2015. Its failure to estimate its losses from the alleged corruption scheme and produce audited third-quarter results prompted Moody's to cut its rating to junk, the report said. Rival agency Standard & Poor's delivered a further blow on March 23 when it revised its outlook on the company from stable to negative, the TCRLA reported on March 26, 2015. On Feb. 10, 2015, TCRLA said Fitch Ratings has downgraded the foreign and local currency Issuer Default Ratings (IDRs) and outstanding debt ratings of Petrobras to 'BBB-' from 'BBB'. Concurrently, Fitch has placed all of Petrobras' international and national scale ratings on Rating Watch Negative. ========================== C A Y M A N I S L A N D S ========================== 2020 GLOBALGROWTH: Shareholders' Final Meeting Set for May 28 ------------------------------------------------------------- The shareholders of 2020 Globalgrowth Equities Limited will hold their final meeting on May 28, 2015, at 9:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands ABYDOS FUND: Shareholders' Final Meeting Set for June 3 ------------------------------------------------------- The shareholders of Abydos Fund will hold their final meeting on June 3, 2015, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands ABYDOS MASTER: Shareholders' Final Meeting Set for June 3 --------------------------------------------------------- The shareholders of Abydos Master Fund will hold their final meeting on June 3, 2015, at 10:20 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands ACQUITY GROUP: Shareholders' Final Meeting Set for May 28 --------------------------------------------------------- The shareholders of Acquity Group Limited will hold their final meeting on May 28, 2015, at 9:05 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands LANDMARK CDO: Members' Final Meeting Set for May 25 --------------------------------------------------- The members of Landmark CDO Ltd. will hold their final meeting on May 25, 2015, at 10:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands MONSOON INDIA: Shareholders' Final Meeting Set for June 3 --------------------------------------------------------- The shareholders of Monsoon India Select Equity Cayman Fund Ltd. will hold their final meeting on June 3, 2015, at 10:40 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands OPUS COMMODITIES: Shareholders' Final Meeting Set for May 28 ------------------------------------------------------------ The shareholders of Opus Commodities Select SPC will hold their final meeting on May 28, 2015, at 1:10 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Mervin Solas c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands SI INTERNATIONAL: Shareholders' Final Meeting Set for June 3 ------------------------------------------------------------ The shareholders of SI International (Topco) Inc. will hold their final meeting on June 3, 2015, at 1:30 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Mervin Solas c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands SOLAR NXP: Shareholders' Final Meeting Set for June 3 ----------------------------------------------------- The shareholders of Solar NXP Limited will hold their final meeting on June 3, 2015, at 1:20 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Mervin Solas c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands TIGER GLOBAL XI: Shareholders' Final Meeting Set for May 29 ----------------------------------------------------------- The shareholders of Tiger Global PIP V China Holdings XI, Ltd. will hold their final meeting on May 29, 2015, at 10:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Gregory Seidell c/o Campbells Willow House, Floor 4 Cricket Square Grand Cayman KY1-1103 Cayman Islands Telephone: +1 (345) 949 2648 Facsimile: +1 (345) 949 8613 TIGER GLOBAL XII: Shareholders' Final Meeting Set for May 29 ------------------------------------------------------------ The shareholders of Tiger Global PIP V China Holdings XII, Ltd. will hold their final meeting on May 29, 2015, at 10:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Gregory Seidell c/o Campbells Willow House, Floor 4 Cricket Square Grand Cayman KY1-1103 Cayman Islands Telephone: +1 (345) 949 2648 Facsimile: +1 (345) 949 8613 =================================== D O M I N I C A N R E P U B L I C =================================== * DOMINICAN REPUBLIC: April Prices Fall -0.25%, Paced by Foods -------------------------------------------------------------- Dominican Today reports that Dominican Republic Central Bank said prices in April fell -0.25% compared with March last year, paced by foods and non-alcoholic beverages. It said first quarter inflation stood at -0.09%, according to Dominican Today. The report notes that the Central Bank said inflation over the last 12 months, from April 2014 to April 2015 was -0.04%, "significantly lower than the inflation of 3.49% recorded at the end of April last year." It said lower prices on foods and non-alcoholic beverages in April paced the negative inflation, the report relates. * DOMINICAN REP: Raise Wages, Avert Social Unrest, Bishop Warns --------------------------------------------------------------- Dominican Today reports that the former head of the Catholic University (PUCMM) called on Dominican Republic's business leaders to avert social unrest by attending to the demands of a wage increase by the various labor unions. Monsignor Agripino Nunez said businesses should be most interested in avoiding a nationwide strike and warned them that protests are never peaceful, "so they should be avoided by arriving at an agreement between the parties," according to Dominican Today. The report relates that Monsignor Nunez said he expects the meeting slated for May 20 between the Labor Ministry, employers and union leaders to reach an agreement leading to industrial peace. The senior bishop spoke after receiving a plaque in a golf tournament at the Las Aromas links in Otra Banda, west of Santiago, the report discloses. =============== H O N D U R A S =============== HONDURAS: Moody's Alters Gov't. Bond Ratings Outlook to Positive ---------------------------------------------------------------- Moody's Investors Service revised the outlook on Honduras' government bond ratings to positive from stable. Concurrently, Moody's has affirmed the foreign and local currency government's issuer ratings and senior unsecured ratings at B3. Moody's decision to revise the outlook on Honduras' ratings is based on our expectations for: (1) Continued progress toward fiscal consolidation targets, building on the fiscal deficit narrowing to 4.4% of GDP in 2014 (2) Continued commitment to fiscal and structural reforms set out in the December 2014 IMF agreement (3) Reduction of government liquidity risks The affirmation of the B3 ratings reflects Honduras' trajectory of high fiscal deficits and rising debt ratios, weak economic strength given the small size of the economy and low income per capita and very low institutional strength. The country ceilings remain unchanged. The long-term local currency bond and deposit ceilings are B2, the long-term foreign currency deposit ceiling is Caa1, and the long-term foreign currency bond ceiling is B2. First Driver -- Continued progress toward fiscal consolidation targets: The fiscal deficit narrowed to 4.4% of GDP in 2014 from 7.9% of GDP in 2013 surpassing even the government's own target of 4.7% of GDP. Fiscal consolidation was supported by a tax reform that raised revenues close to 2% of GDP, expenditure cuts and, more importantly, measures that have introduced discipline in the budget process. Efforts to curtail expenditures have focused on maintaining public sector salaries constant in nominal terms, reducing the number of public sector employees, cutting back investment spending, and reducing government transfers (i.e., subsidies, social assistance programs, transfers to municipalities and loss-making state-owned enterprises). To improve the budget process, no revisions are now allowed to the limits set in the budget -- in 2012 and 2013 limits were revised more than 20 times. Also, new projects can be approved only if others are cut or cancelled and legal sanctions can be imposed on officials who exceed spending limits. A budget committee was created to review the ministries' spending requests and only those requests that fall within the budget limits are approved. An important change in debt management is the government's decision to stop accumulating arrears with suppliers, known as floating debt. Government officials are planning to deliver fiscal deficits lower than those agreed with the IMF, targeting a deficit of 3.8% of GDP in 2015 compared to 4.0% in the agreement. The government's target for 2016 is 3.0% of GDP compared to 3.4% in the agreement. Second Driver -- Continued commitment to fiscal and structural reforms as set out in the December 2014 IMF Agreement: Fiscal consolidation efforts that began early in 2014 have become more structured after the government signed an IMF agreement on December 2014. The IMF program has facilitated policy consistency to government efforts, while quarterly reviews provide continuing monitoring. In March the IMF issued a statement after the first review indicating that all quantitative targets for December 2014 were met, in most cases with ample margins. Continued commitment to meeting or exceeding fiscal and structural benchmarks set out in the IMF Agreement would support continued positive pressure on the rating. The IMF agreement incorporates fiscal consolidation targets that will require the government to cut current expenditures in 2015-17 as revenue-enhancing measures were already adopted after the 2013 tax reform was implemented last year. Since current expenditures comprise mostly public sector salaries (8.2% of GDP equivalent to 45% of current spending), Moody's expect reductions in the government's wage bill will have a material impact on the fiscal deficit. Moody's expect public investment will continue to contract and also that government transfers, which represent 7% of GDP, will be curtailed. Transfers to local governments and other public entities will be maintained in nominal terms in 2015, while those going to the national electricity company (ENEE) will be gradually reduced. Spending in key social assistance programs, also part of government transfers, will not be reduced but will be better targeted. Measures affecting ENEE are also part of the IMF agreement, including increases to electricity tariffs and reducing the company's wage bill. Third Driver -- Reduction of government liquidity risks: Refinancing risks have been reduced as a result of a lower fiscal deficit in 2014, the lengthening of debt maturities in the domestic market, and increased access to multilateral financing. Proactive debt management aimed at containing interest costs by prioritizing, according to the authorities, the use of concessional and multilateral debt versus external debt issuances will support further upward pressure on the rating. Gross financing needs remain elevated at around 7.5% of GDP. Rationale for Affirming the B3 Ratings: The positive outlook reflects Moody's expectation that Honduras will continue to make steady progress in 2015 in terms of fiscal consolidation and that the government will continue to comply with targets set in the IMF program. While a positive outlook suggests that, if current conditions are preserved, this may lead to a material reduction in Honduras' credit risks, the track record is short with only the first IMF review being completed. B3 ratings reflect high fiscal deficits, rising debt ratios, deteriorating debt affordability, increased reliance on short-term domestic debt and higher gross financing needs due to the significant increase in debt in the last six years. The B3 ratings also reflect weak economic strength given the small size of the economy, low income per capita and high crime rates which hinder long-term GDP growth, while very low institutional strength is explained by weak government effectiveness and rule of law, as well as low control of corruption. What could change the rating - Up: There could be upward pressure on Honduras' ratings if: (i) the government continues to reduce its fiscal deficit this year, (ii) the government complies with targets set in the IMF program in the second part of 2015, and (iii) government liquidity risks continue its downward trajectory by lengthening debt maturities in the domestic market. What could change the rating - Down: The outlook could be revised to stable if (i) fiscal consolidation is halted or reversed, (ii) there is a reemergence of near-term refinancing pressures involving domestic debt, or (iii) reduced access to multilateral funding that leads to limited financing options. Country Ceilings: The country ceilings did not change as a result of this action. The long-term local currency bond and deposit ceilings remain at B2. The long-term foreign currency deposit ceiling remains at Caa1. The long-term foreign currency bond ceiling remains at B2. All short-term ceilings remain at Not Prime. Country ceilings reflect a range of undiversifiable risks to which issuers in any jurisdiction are exposed, including economic, legal and political risks. These ceilings act as a cap on ratings that can be assigned to the foreign and local-currency obligations of entities domiciled in the country. - GDP per capita (PPP basis, US$): 4,729 (2014 Actual) (also known as Per Capita Income) - Real GDP growth (% change): 3.1% (2014 Actual) (also known as GDP Growth) - Inflation Rate (CPI, % change Dec/Dec): 5.8% (2014 Actual) - Gen. Gov. Financial Balance/GDP: -4.4% (2014 Actual) (also known as Fiscal Balance) - Current Account Balance/GDP: -7.4% (2014 Actual) (also known as External Balance) - External debt/GDP: 36.9% (2014 Actual) - Level of economic development: Low level of economic resilience - Default history: No default events (on bonds or loans) have been recorded since 1983 On May 7, 2015, a rating committee was called to discuss the rating of Honduras, Government of. The main points raised during the discussion were: The issuer's fiscal or financial strength has materially increased. The issuer's governance and/or management, have materially increased. The issuer has become less susceptible to event risks. Other views raised included: The issuer's economic fundamentals, including its economic strength, have not materially changed. The issuer's institutional strength/ framework, have not materially changed. The principal methodology used in these ratings was Sovereign Bond Ratings published in September 2013. The weighting of all rating factors is described in the methodology used in this rating action, if applicable. =========== M E X I C O =========== GRUPO SENDA: Fitch Affirms 'B' Issuer Default Ratings ----------------------------------------------------- Fitch Ratings has affirmed Grupo Senda Autotransporte, S.A. de C.V.'s (Grupo Senda) local and foreign currency Issuer Default Ratings (IDRs) at 'B'. The Rating Outlook is Stable Grupo Senda's 'B' ratings reflect the company's leading market position in the highly competitive and fragmented intercity bus passenger transportation sector in Mexico, weak liquidity, high leverage and financing cost, and limited free cash flow (FCF) generation. Positively considered in the ratings is the importance of the country's bus transportation system within Mexico because of income constraints that limit the ability of many people to use alternative transportation sources, such as automobiles or airlines. Also reflected in the ratings is Fitch's expectation that margins will return to historical levels above 21% in 2015. KEY RATING DRIVERS Operational Results Expected to Continue to Recover Grupo Senda's consolidated revenue per kilometer run has been pressured since the start of 2013 primarily by sluggish economic conditions in Mexico. The application of a 16% value added tax (VAT) to passenger ticket prices effective at the beginning of 2014 was also negative as the company absorbed some of this increase. Senda's personnel transportation segment has performed well. It accounted for 29% of consolidated revenues during the LTM ended March 31, 2015. Positive momentum in Mexican manufacturing, especially in the auto industry, supports the positive operating trends in this division. The company's LTM revenues were up 2.2% after being down 0.2% in the comparable period of 2014. On an LTM basis also as of March 2015, Passenger segment revenues were recovering but still down 0.8%, while Grupo Senda's personnel segment recorded a 10.1% revenue increase partly due to last year's expansion into the new markets of Zacatecas and Cd. Juarez as well as organic growth in key North East Mexico markets. Rising costs per kilometer are expected to finally ease as high fuel inflation in Mexico, where the price of diesel fuel and gasoline are controlled by the Mexican government, moderates. Diesel price to the public is currently above international prices and increased 11.6% in 2014, 11.8% in 2013, 10.7% in 2012, and 10.6% in 2011. As a percent of Grupo Senda's revenue, fuel expenses have increased to 19.7% in 2014 from 16.7% in 2011. For 2015, the government has implemented a much more moderate increase of 1.9%, which together with a transfer to the passengers of most of the VAT increase, should support EBITDA margin recoveries to levels above 21% in 2015. Weak Liquidity Could Trigger Negative Rating Actions The company's cash balance and FCF generation remain low relative to debt obligations. As of March 31, 2015, Grupo Senda's cash balance was MXN102 million and its total debt including financial leases was MXN3.287 million, of which MXN733 million was short term. The company's indebtedness as of March 2015 consisted primarily of bank debt and financial leases. As of LTM March 31, 2015, Fitch-calculated EBITDA was MXN797 million, which compares to EBITDA of MXN792 million a year ago. Free cash flow during the LTM was negative MXN120 million, which is an improvement from negative MXN277 million a year ago. Most of the company's capex is related to new buses has and continues to be funded with financing leases. Fitch estimates Grupo Senda's cash flow from operations (CFFO) after interest paid will average about MXN470 million for the next three years. With no dividend payments, FCF should be moderately positive at around MXN100 million per year. Fitch estimates Grupo Senda's 2015 gross leverage will be around 3.8x, which is a modest improvement from 4.1x as of March 31, 2015. The company's management is looking at different refinancing options to extend its maturity profile and improve liquidity. The absence of significant lengthening in the company's debt amortization schedule or improvement in its capital structure could result in negative rating actions. Strong Position in a Competitive industry The bus transportation industry in Mexico is highly fragmented and competitive with a limited number of national or regional bus companies operating more than 100 buses and a large number of local bus companies and informal bus operators. Compared with smaller or owner-operated passenger bus companies, Grupo Senda's business model allows the company to operate more efficiently, better adapt to market conditions, and provide standardized services. In contrast, most of Mexico's authorized bus transportation companies are owner-operated which means that bus drivers typically own one or more of the buses they operate and control shares of the company in proportion to the number of buses owned. Fragmentation has in the past resulted in discounted price competition during times when industry margins are pressured by economic contraction . Bus transportation services play a significant role in the overall passenger transportation sector in Mexico, accounting for approximately 97% of the 3 billion passenger tickets sold for intercity travel in 2013. Alternative means of transportation such as airplane or personal car are not economically viable for the average traveler, as approximately 90% of the Mexican population earn less than USD700 per month. With an average bus ticket price of about USD10, Grupo Senda estimates that only 4.2% of the company's routes directly compete with low-cost air carriers. KEY ASSUMPTIONS -- Low mid-single-digit revenue growth in the passenger segment driven mostly by continued recovery of pre-VAT fares and inflation-adjusted ticket price increases; -- High single digit-to-low double-digit growth in Grupo Senda's Personnel segment as the company continues to grow organically in established markets; -- Low single-digit diesel fuel price increases in 2016-2017; -- No dividend payments; -- Continued access to bank lending RATINGS SENSITIVITIES A negative rating action could be triggered by: -- Absence of debt refinancing that extends the amortization schedule of debt maturities and is better aligned with cash generation. -- Lack of significant improvement in operational results. -- A deterioration of the company's credit metrics due to sizeable negative FCF or higher total debt levels. Expectations by Fitch of total debt/ EBITDA being consistently at or beyond 4.5x would likely result in a downgrade. -- Increasing competition followed by the return to discounted- price practices, as a key component of the company's business strategy to gain market share, would also likely result in negative rating actions. Fitch would view as positive to credit quality: -- FCF generation significantly above Fitch's current expectations and a medium-term expectation of net leverage at or below 2.5x while maintaining adequate liquidity, and a manageable debt maturity profile. MATAMOROS MUNICIPALITY: Moody's Withdraws Ba1 Issuer Rating ----------------------------------------------------------- Moody's de Mexico has withdrawn the municipality of Matamoros' Ba1/A1.mx issuer ratings. Prior to withdrawal, the ratings had a stable outlook. Moody's has withdrawn the ratings for its own business reasons. The principal methodology used in these ratings was Regional and Local Governments published in January 2013. The period of time covered in the financial information used to determine Matamoros' rating is between rating is between Jan. 1, 2009 and Dec. 31, 2013. SU CASITA: Fitch Affirms 'D(mex)' Nat'l LT Rating on Class B Notes ------------------------------------------------------------------ Fitch Ratings has affirmed Su Casita Trust's two residential mortgage back securities (RMBS) sponsored by Hipotecaria Su Casita, S.A. de C.V., SOFOM, E.N.R. (Su Casita): Class A Floating Rate Notes due 2035 -- Long-term rating affirmed at 'CCsf' and 'CC(mex)vra' Class B UDI-Indexed Notes due 2035 -- National long-term rating affirmed at 'D(mex)'. KEY RATING DRIVERS The ratings on the Class A and Class B notes reflect the transaction's liquidity risk and high exposure to non-performing loans and Real Estate Owned Assets (REOs). The rating of the Class B notes considers the tranche's structural subordination to Class A and its consistent default on accrued interest payments. The repayment on the Class A notes is becoming increasingly dependent on an unrated third party guarantee. As of the April 2015 distribution date, Class A overcollateralization (excluding +90 days delinquent loans from the loan pool) stands at -121.7% and -102.0% when excluding +180 days delinquent loans. Both levels negatively compare with those observed 12 months ago which were -71.8% and -55.6%, respectively. As of the April 2015 distribution date, +90 days delinquent loans represent 26.2% of their original loan balance and 65.1% of their aggregate outstanding balance. Fitch notices late delinquent loans (+180 days) are gradually increasing and could result in lengthen recovery processes. REOs sales are also intermittent and the observed recovery rates shown by the new substitute servicer reflect an average of approximately 50% (of the respective loan outstanding balance). In Fitch's view, interest payments on the notes are increasingly dependent on REO sales. Fitch will monitor performance and progress of the new substitute servicer, Adamantine Servicios S.A. de C.V. This is the second substitute servicer for the loan portfolio and efforts will be focused on increasing cashflows through restructuring delinquent loans and potential sales of REOs. While the servicer substitution process has been reasonably managed and the migration between servicers is complete, Fitch's believes certain operational risks could result in additional delays in collections as new servicing initiatives are implemented and borrowers start adapting to this servicing platform. RATING SENSITIVITIES Class A's ratings exhibit limited upgrade potential. Among other factors, a downgraded would occur if REO management deteriorates; if special collection efforts do not result in better recovery prospects in the foreseeable future; and if the third party guarantee would stop making payments since Class A's interest and principal payment have become more dependent on such external credit protection. As of this date, Recovery Estimates (RE) for the Class A outstanding balance (without considering the third party guarantee) are deemed to be approximately 75% (RE75%). *********** 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 2015. 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 202-362-8552. * * * End of Transmission * * *