/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/150617.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, June 17, 2015, Vol. 16, No. 118 Headlines A R G E N T I N A ARCOS DORADOS: Fitch Cuts Issuer Default Rating to 'BB+' B R A Z I L BIC ARRENDAMENTO: Moody's Affirms Ba1 LC Subordinated Debt Rating BRAZIL: Banks Face $59 Billion Court Dispute BRAZIL: Real Declines to One-Week Low as Trade Surplus Narrows BRAZIL: Analysts Expect Economy to Contract 1.35% BRAZIL: Moody's Assigns CR Assessments to 17 Banks MDL REALTY: Moody's Downgrades CFR to Caa1, Outlook Negative C A Y M A N I S L A N D S AEM SELECT: Members' Final Meeting Set for June 24 BLUE SKY: Members' Final Meeting Set for June 22 CAL DIVE: Commences Liquidation Proceedings CBRE COF: Commences Liquidation Proceedings GGI SRI: Members' Final Meeting Set for June 24 ML KNIGHT 2003: Members' Final Meeting Set for June 24 ML KNIGHT 2003 INVESTOR: Members' Final Meeting Set for June 24 PRESTIGE AIRCRAFT: Shareholders' Final Meeting Set for June 30 RENUK LIMITED: Members' Final Meeting Set for June 22 ZENITH LIFE: Commences Liquidation Proceedings C H I L E AUTOMOTORES GILDEMEISTER: Moody's Lowers Global Scale CFR to B3 C O L O M B I A ISAGEN SA: Defeated Ex-CFO Reemerges to Upend Privatization Plan J A M A I C A JAMAICA: Consumer Prices up in May M E X I C O CORPORACION GEO: Judge Approves Debt Restructuring Plan T R I N I D A D & T O B A G O TRINIDAD & TOBAGO: Gov't Concerned at Rising Household Debt - - - - - ================= A R G E N T I N A ================= ARCOS DORADOS: Fitch Cuts Issuer Default Rating to 'BB+' -------------------------------------------------------- Fitch Ratings has downgraded the ratings of Arcos Dorados B.V. (AD) and Arcos Dorados Holdings Inc. (Arcos), as well as the BRL675 million and USD475 million senior unsecured notes issued by Arcos, to 'BB+'. The Outlook for the corporate ratings is Negative. KEY RATING DRIVERS The downgrade of Arcos' and AD's ratings reflects the company's weak operating performance, which has felt the impact of a very challenging macroeconomic environment in Latin America, specifically in Venezuela, Brazil, and Mexico. Soft consumption across the region and currency devaluations have contributed to an increase in the company's net lease-adjusted leverage above 4.5x, which is above the 3.5x ratio expected by Fitch. The Negative Outlook reflects concern that the company may not be able to reduce its net lease-adjusted debt-to-EBITDAR ratio to below 4.0x within the next 12 to 24 months. Weak Regional Performance Increased volatility in Venezuela, a soft consumer environment in Brazil and Mexico, and currency devaluations have contributed to a sharp decline in EBITDA. Arcos' Fitch-calculated EBITDA was USD233 million during the LTM ended March 31, 2015. This figure compares with USD240 million at year-end 2014 and USD343 million at year- end 2013. Fitch forecasts regional GDP growth to be 0.5% in 2015 and a contraction of 1% in Brazil, which is Arcos' largest market. Increased Importance of Brazil Brazil is the company's largest market, contributing to 50% of sales and 76% of EBITDA during 2014. Excluding operations in Venezuela and Argentina, Fitch estimates these figures to be about 60% and 85%, respectively. Brazil has become increasingly important to the success of Arcos' operations in Latin America and is the main market for its three-year restaurant opening plan under the master franchise agreement (MFA) with McDonald's Corporation ('BBB+', Outlook Stable). Negatively, Brazilian consumption has stagnated and Fitch expects soft consumption for the next 12-18 months. Increased Leverage Arcos' net lease-adjusted leverage was 4.6x as of Dec. 31, 2014; this compares negatively to an average of 3.2x maintained from 2010 to 2013. Fitch estimates that its net lease-adjusted debt/EBITDAR excluding EBITDA from Venezuela and Argentina is about 4.9x. Arcos' decision to suspend dividend payments in 2015 and slow the pace of its expansion under the MFA is positive and should reduce pressure on the company's cash flow generation. In 2015 the company expects to have 40-45 gross restaurant openings. In the absence of real estate asset sales and/or the realization of other measures announced by the company, such as re- franchising, Fitch does not expect a significant deleveraging in the next couple of years. The company seeks to sell around USD200 million of assets, which would lower leverage to around 3.5x. Exposure to Transferability Risk Arcos is exposed to high transferability risk in its Venezuelan operations. Restrictions imposed by the Venezuelan Central Bank have limited the U.S.-dollar supply in that country, which constrains the repatriation of available cash and restricts payment for imported goods as well as royalties. Following measures announced by the local government, Arcos obtained a temporary waiver to reduce royalty payments to McDonald's Corporation in 2012, 2013, and 2014. Fitch estimates that Venezuela represented about 5% of total sales in 2014. Arcos is also exposed to transferability risk with its Argentine operation. However, this risk is partially mitigated by the fact that its local operation does not generate excess cash, as Arcos' headquarters is based in Argentina. MFA with McDonald's The MFA sets strict strategic, commercial, and financial guidelines for Arcos' operations which support the operating and financial stability of the business as well as the underlying value of the McDonald's brand in the region. Arcos is the largest McDonald's franchisee in the world in terms of system-wide sales and number of restaurants. About 75% of the restaurants are operated by Arcos, and the remaining 25% are franchised restaurants. The company's 2015 strategy includes 40-45 restaurants (gross openings) that would require investments of USD90 million to USD120 million. In 2014 Arcos was not in compliance with certain debt covenants established by the MFA; McDonald's granted a waiver through March 31, 2015. In addition, the company is in negotiations with McDonald's to modify the current three-year expansion plan given the weak Latin American environment. Under the terms of the MFA, McDonald's has a call option to repurchase its assets in the region under certain events. Terms of the notes specify that these funds should be applied to debt repayment. The call option price is set as the fair market value of all assets of the operating companies (80% in the case of a material breach), minus debt at operating company and contingencies, plus cash. The MFA requires all group companies to remain current on their financial obligations to avoid a material breach of the agreement. Strength of McDonald's Franchise The ratings also incorporate the strength of McDonald's as franchisor and its long-standing relationship with Arcos' owners and management. Arcos' controlling shareholder was the joint venture partner of McDonald's in Argentina for over 20 years and served as president of the McDonald's South America division from 2004 until the acquisition. On average, the management team has worked for over 12 years at McDonald's. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for Arcos include the following: -- No growth in sales or EBITDA in 2015 due to weak regional environment, specifically Brazil -- Revenues grow 1% in 2016, 1.5% in 2017 and 2% in 2018 -- 30% devaluation in Argentina in 2016 -- EBITDA margin approaches 8% by 2018 -- No dividends in 2015 or 2016 -- BRL bond refinanced in 2016 -- Arcos receives about USD200 million from 2016-2018 in real estate asset sales and redevelopment. Proceeds used to reduce debt. -- Modest annual deleveraging to reach a net lease-adjusted leverage ratio of around 3.5x by 2018 Rating Sensitivities Arcos' ratings could be negatively affected by continued weak performance in Brazil; significant deterioration of same store sales; and higher than expected investments and dividends, pressuring free cash flow FCF and leverage ratios. Additional factors that could lead to consideration of a further downgrade include: inability of Argentine and Venezuelan operations to be self-sustaining; failure to comply with the terms of the MFA; failure to execute non-core real estate asset sales; and/or a consolidated net lease adjusted debt-to-EBITDAR ratio above 4.0x on a sustained basis. A positive rating action is not likely in the near- to medium- term. The ratings could be positively affected by higher than expected cash generation from investment-grade countries that would lead to a material improvement in leverage metrics such as net lease-adjusted debt levels below 3.5x. Liquidity Arcos had USD2 billion of total adjusted debt and USD71 million of cash and marketable securities as of March 31, 2015; the company has about USD4 million of cash in Venezuela which Fitch considers as restricted cash. Short-term debt totaled USD64 million, which includes about USD10 million in derivatives, USD5 million in interest, and a USD5 million current portion of long-term debt. Liquidity is further enhanced by a USD75 million revolving credit facility with Bank of America which matures in August 2015. As of March 31, 2015, Arcos had borrowed USD35 million due in April 2015. Fitch expects that this facility will be renewed for an additional two years. In addition, Arcos has credit and debit card receivables of about USD39 million as of Dec. 31, 2014, meal voucher receivables of USD13 million, and USD38 million in receivables from franchisees. Full List of Rating Actions Fitch has downgraded the following ratings: AD -- Foreign currency Issuer Default Rating (IDR) to 'BB+' from 'BBB-'; -- Local currency IDR to 'BB+' from 'BBB-'. Arcos -- Foreign currency IDR to 'BB+' from 'BBB-'; -- BRL675 million senior unsecured Brazilian-real notes due 2016 to 'BB+' from 'BBB-'; -- USD473.767 million senior unsecured notes due 2023 to 'BB+' from 'BBB-'. The Outlook for the corporate ratings was revised to Negative from Stable. =========== B R A Z I L =========== BIC ARRENDAMENTO: Moody's Affirms Ba1 LC Subordinated Debt Rating ----------------------------------------------------------------- Moody's America Latina Ltda. affirmed all local currency ratings assigned to BIC Arrendamento Mercantil S.A. (BIC Leasing), including the Baa3 local currency issuer rating, the Ba1 local currency subordinated debt rating as well as the long-term Brazilian national scale ratings of Aa1.br and Aa2.br for issuer and subordinated debt, respectively. The outlook on BIC Leasing's issuer ratings remains stable. Moody's withdrawn the outlook on BIC Leasing's local currency subordinated instrument ratings covered in this press release for its own business reasons. Outlooks are now only assigned to long- term senior debt and deposit ratings, indicating the direction of any rating pressures. The affirmation of the local currency ratings assigned to BIC Leasing follows the affirmation of existing ratings assigned to its parent bank Banco Industrial e Comercial S.A. (BICBANCO). BICBANCO's BCA was lowered to ba3 from ba2, to reflect the ongoing net losses it has reported over the last four quarters and the challenges to turn around its performance in light of still weak asset risk, as a meaningful increase in non-performing loans in early 2015 indicates. Consequently, the bank's tangible common equity to risk weighted assets ratio fell to 5.6% in 1Q15. At the same time, BICBANCO's Baa3 deposit and senior debt ratings were affirmed, benefiting from a three-notch affiliate support uplift from the ba3 BCA. Moody's assesses a very high likelihood of support from its parent China Construction Bank Corporation (A1 stable, baa2), based on it owning a majority stake and the strategic position of the subsidiary given the important trade linkages between Brazil and China. Ratings remain on stable outlook. Upward pressures on BICBANCO's BCA would be related to a clear improvement on asset risk supported by strong enhancement of credit risk standards and significant reduction in problem loans. Consistent improvement in its profitability, and increased capitalization would also be positive for the ratings. Downward pressures on the BCA would be driven by asset risk deterioration, inability to achieve profitability breakeven, and further capital deterioration. Also, an upward/downward pressure on BICBANCO's deposit and debt ratings would be mainly driven by a downgrade/upgrade on CCB's baa2 BCA. The following ratings assigned to BIC - Arrendamento Mercantil S.A. were affirmed: - Long-term global local-currency issuer rating of Baa3, stable outlook - Long-term Brazilian national scale issuer rating of Aa1.br - Long-term global local-currency subordinate debt rating of Ba1 - Long-term Brazilian national scale subordinate debt rating of Aa2.br Moody's took its last rating action on BIC -- Arrendamento Mercantil S.A. on Dec. 1, 2014, when Moody's America Latina upgraded all ratings assigned to BIC Leasing, including the long- term global local-currency issuer rating to Baa3 from Ba1; the long-term Brazilian national scale issuer rating to Aa1.br from Aa2.br; the long-term global local-currency subordinate debt rating to Ba1 from Ba2; and the long-term Brazilian national scale subordinate debt rating to Aa2.br from Aa3.br. At the same time, Moody's changed the outlook on these ratings to stable. The rating action was in line with the rating action Moody's took on Banco Industrial and Comercial S.A. (BICBANCO), announced on Dec. 1, 2014. BRAZIL: Banks Face $59 Billion Court Dispute -------------------------------------------- Mario Sergio Lima and Arnaldo Galvao at Bloomberg News report that Brazilian banks would have to pay upfront if they were to lose a $59 billion class-action suit against them over government anti- inflation plans that caused depositor losses. Government and banks were expecting that the damages could be diminished if they lost, either by postponing payments or reducing the amount, according to a senior government official and a bank executive, notes Bloomberg News. Yet laws governing the Supreme Court require at least eight of 11 votes in favor to reduce the immediate financial impact of the decision, a result that has become impossible after three judges recused themselves and Judge Marco Aurelio Mello said he opposed the plan, says the report. "I've already made my position clear many times: I'm against," Mr. Mello told Bloomberg News in a phone interview. He said that without his support the court won't be able to mitigate any ruling against the banks. Bloomberg News relates that the Supreme Court is expected as early as August to resume the case that has been working its way through the judicial system for decades. The judges suspended the ruling in November 2013, after the central bank said a decision against the banks could drain a quarter of the lenders' capital and further strain Brazil's economy, Bloomberg News relays. Banco do Brasil SA, Latin America's largest bank by assets, and Itau Unibanco Holding SA, the biggest by market value, are among companies targeted by depositors seeking compensation for losses stemming from government policies adopted to fight hyperinflation in the 1980s and 1990s, Bloomberg News notes. The banks deny any wrongdoing, saying they implemented changes ordered by the government. Biggest Concern Bloomberg News notes that Itau Chief Executive Officer Roberto Setubal said in February that the case is the Sao Paulo-based bank's biggest concern. Banks don't have provisions to cover all the claims, according to the banking association, Febraban, Bloomberg News discloses. The report notes tht Brazil's central bank estimated in 2013 that restitution could cost the industry about BRL150 billion ($48 billion). That would jump to about BRL182 billion with interest, based on the average annual benchmark rate for the period under review, according to data compiled by Bloomberg. President Dilma Rousseff's administration expected the Supreme Court to use as a model a March decision on a separate matter that gave cities and states until 2020 to pay some debt based on court order, Bloomberg News notes. That would relieve banks of the immediate financial impact, a government official said in a May interview, Bloomberg News adds. BRAZIL: Real Declines to One-Week Low as Trade Surplus Narrows -------------------------------------------------------------- Filipe Pacheco and Paula Sambo at Bloomberg News report that Brazil's real dropped to a one-week low as the South American nation posted a trade surplus that was about a third of the previous level, reviving concern that inflows are diminishing amid economic weakness. "Even though the real is considerably cheaper in the recent months, we don't see exports picking up as much as desirable," Reginaldo Galhardo, a foreign-exchange manager at Treviso Corretora de Cambio in Sao Paulo, told Bloomberg News in a telephone interview. "We recognize a widespread bad sentiment even among exporters." The real decreased 0.5 percent to 3.1269 per dollar at the close of trade in Sao Paulo on June 15, the weakest level on a closing basis since June 5, after climbing 0.8 percent, Bloomberg News notes. One-month implied volatility on options for the real, reflecting projected shifts in the exchange rate, climbed to 17.12 percent from last week's 16.73 percent, which was the lowest since Feb. 5, Bloomberg News relays. The government posted a trade surplus of $678 million for the week ended June 14, compared with $1.98 billion in the prior period. The real climbed earlier on enhanced prospects for the nation's inflows as Embraer SA announced orders for regional jets worth $2.6 billion, Bloomberg News relays. The report notes that swap rates on the contract maturing in January 2017, a gauge of expectations for changes in Brazil's borrowing costs, increased 0.18 percentage point to 14.06 percent, a six-year high. Policy makers voted unanimously this month to lift the benchmark lending rate by 0.5 percentage point to 13.75 percent, the highest level since 2009, says Bloomberg News. As inflation remains above target, Brazil is the only member of the Group of 20 nations raising borrowing costs this year, the report adds. GDP Outlook According to Bloomberg News, analysts are becoming more pessimistic about the economy. Gross domestic product will contract 1.35 percent in 2015 before expanding 0.9 percent next year, according to the median of about 100 estimates in a central bank survey published, Bloomberg News notes. Previously, they predicted a contraction of 1.30 percent this year and a 1 percent expansion in 2016, Bloomberg News relays. In a positive sign for trade, executives at Embraer announced at the Paris Air Show deals with United Continental Holdings Inc. and other foreign buyers, cementing its standing as the biggest maker of regional jets, Bloomberg News discloses. Brazil extended the maturity on 6,300 foreign-exchange swap contracts worth $308.9 million, compared with 8,100 daily last month, Bloomberg News notes. The central bank monitors hedge demand and not the exchange rate when preparing swap offerings, a member of President Dilma Rousseff's economic team said, Bloomberg News relays. Policy makers consider risks to financial stability, according to the official, who asked not to be identified because the discussions aren't public, Bloomberg News adds. BRAZIL: Analysts Expect Economy to Contract 1.35% ------------------------------------------------- EFE News reports that analysts have revised their estimates downward and now expect Brazil's economy to contract 1.35 percent this year, the Central Bank said. The gross domestic product (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. A week ago, analysts surveyed for the Boletin Focus expected Latin America's largest economy to contract by 1.3%, the report relays. Analysts expect Brazil to finish 2015 with an inflation rate of 8.79 percent, up from the 8.46 percent estimate released last week, the report discloses. The government has revised its GDP estimate for 2015 to show a contraction of 1.20 percent, the report notes. If the GDP forecast proves to be accurate, it would be Brazil's worst performance since 1990, when the economy contracted by 4.35 percent, the report says. The South American country's economy grew just 0.10 percent last year, compared to 2013, the report adds. BRAZIL: Moody's Assigns CR Assessments to 17 Banks -------------------------------------------------- Moody's Investors Service assigned Counterparty Risk Assessments (CR Assessments) to seventeen Brazilian banks. The announcement follows the publication of the rating agency's new bank rating methodology. The 17 Brazilian banks covered are: - Banco Alfa de Investimento S.A. - Banco Cetelem S.A. - Banco Daycoval S.A. - Banco do Estado de Sergipe S.A. - Banco do Estado do Para S.A. - Banco GMAC S.A. - Banco Industrial do Brasil S.A. - Banco Indusval S.A. - Banco Mizuho do Brasil S.A. - Banco Modal S.A. - Banco Original S.A. - Banco Original do Agroneg¢cio S.A. - Banco Paulista S.A. - Banco PSA Financial Brasil S.A. - Banco Santander (Brasil) S.A. - Banco Sofisa S.A. - BES Investimento do Brasil S.A. A list of the affected credit ratings is available at http://is.gd/lkrHP4 As part of the actions, Moody's has assigned a Counterparty Risk Assessment (CR Assessment) to 17 banks and their branches. CR Assessments are opinions of how counterparty obligations are likely to be treated if a bank fails, and are distinct from debt and deposit ratings in that they (1) consider only the risk of default rather than expected loss and (2) apply to counterparty obligations contractual commitments rather than debt or deposit instruments. The CR Assessment is an opinion of counterparty risk related to a bank's covered bonds, contractual performance obligations (servicing), derivatives (e.g. swaps), letters of credit, guarantees and liquidity facilities. For these 17 Brazilian banks, the CR Assessment is positioned, prior to government support, one notch above each bank's respective Adjusted BCAs and, therefore, above the senior unsecured and deposit ratings, reflecting Moody's view that its probability of default is lower than that of senior unsecured debt and deposits. Moody's believe that senior obligations represented by the CR Assessment will be more likely preserved in order to limit contagion, minimize losses and avoid disruption of critical functions. Moody's notes that the CR Assessment does not benefit from any government support, in line with our support assumption on deposits and senior unsecured debt ratings for these 17 banks. This reflects our view that operating activities and obligations reflected by the CR Assessments are unlikely to benefit from any support provision from resolution authorities to senior unsecured debt and deposits. The principal methodology used in these ratings/analysis 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". Moody's took its last rating action on Banco Santander (Brasil) S.A. (Santander Brazil) on Sep. 9, 2014, when the rating agency changed to negative, from stable, the outlook on Santander Brazil's long-term global local and foreign currency deposit ratings, as well as on the senior unsecured rating assigned to the bank and to the Cayman branch. At the same time, all ratings were affirmed. These rating actions followed the change in outlook to negative, from stable, on Brazil's government bond ratings. Moody's took its last rating action on Banco Alfa de Investimento S.A. (Alfa) on Sep. 9, 2014, when the rating agency changed to negative, from stable, the outlook on Alfa's long-term local and foreign currency deposit ratings of Baa2. The Prime-3 short-term local and foreign currency deposit ratings as well as the baa2 baseline credit assessment and the Aaa.br/BR-1 long and short-term Brazilian national scale ratings remained unchanged. The action followed the change in outlook to negative, from stable, on Brazil's government bond ratings. Moody's took its last rating action on Banco Mizuho do Brasil S.A. (Mizuho Brazil) on Sep. 15, 2014, when the rating agency changed to negative, from stable, the outlook on Mizuho Brazil's long-term foreign currency deposit rating of Baa2. At the same time, Moody's affirmed all ratings assigned to Mizuho Brazil and maintained its baseline credit assessment (BCA) at ba3. The outlook on the long- term global local currency deposit rating of Baa2 and the long- term Brazilian national scale deposit ratings of Aaa.br remained stable. This rating action follows the change in outlook to negative, from stable, on Brazil's government bond ratings. Moody's took its last rating action on Banco Daycoval S.A. (Daycoval) on Aug. 12, 2014, when Moody's America Latina Ltda assigned a Baa3 global local currency debt rating and a Aa1.br national scale debt rating to the 2016 and 2017 local currency senior unsecured banknotes (letras financeiras) issued by Daycoval. Other ratings remained unchanged. The outlook on the ratings was placed on stable. Moody's took its last rating action on Banco Cetelem S.A. (Cetelem) (former Banco BGN S.A.) on Sep. 22, 2009, when the rating agency upgraded the bank's foreign currency deposit rating to Ba1, from Ba2 as a result of the upgrade of Brazil's deposit ceiling to Baa3 from Ba2. The outlook on all ratings was placed on stable. Moody's took its last rating action on Banco PSA do Brasil S.A. (Banco PSA) on March 5, 2015, when the rating agency upgraded Banco PSA's long-term global local and foreign currency deposit ratings to Ba1, from Ba2, and the long-term Brazilian national scale deposit rating to Aa2.br, from Aa3.br. The rating action follows Moody's upgrade of the ratings of its French parent Banque PSA Finance, announced on 27 February 2015. The outlook on all ratings remained stable. Moody's took its last rating action on Banco Industrial do Brasil S.A. (BIB) on April 26, 2013, when the rating agency affirmed all ratings assigned to BIB, including the global local-currency and foreign-currency deposit ratings of Ba2 and Not Prime, and the Brazilian national scale deposit ratings of A1.br and BR-1. The outlook on all ratings remained stable. Moody's took its last rating action on Banco GMAC S.A. (GMAC) on Nov. 3, 2014, when the rating agency affirmed GMAC's standalone baseline credit assessment at ba3, and upgraded its long-term global local and foreign currency deposit ratings to Ba2, from Ba3. The short-term global local currency and foreign currency deposit ratings remained unchanged. Moody's downgraded GMAC's Brazilian national scale deposit ratings to A1.br and BR-1, from A3.br and BR-2, long- and short-term, respectively. The outlook on all ratings remained stable. Moody's took its last rating action on Banco Sofisa S.A. (Sofisa) on Dec. 22 2011, when the rating agency downgraded Sofisa's long- term global local and foreign currency deposit ratings to Ba2, from Ba1, as a result of the downgrade of the bank's baseline credit assessment to ba2, from ba1. Moody's also downgraded the bank's long-term Brazilian national scale deposit rating to Aa3.br, from Aa2.br. The ratings outlook was changed to stable. All short-term ratings remained unchanged. Moody's took its last rating action on Banco do Estado de Sergipe S.A. (Banese) on April 29, 2014, when the rating agency assigned first-time ratings to the bank, including a ba2 baseline credit assessment in the global rating scale. At the same time, Moody's assigned a Ba2 and Not Prime long- and short-term global local- and foreign-currency deposit ratings, and a A1.br and BR-1 long- and short-term Brazilian national scale deposit ratings. All ratings were given a stable outlook. Moody's took its last rating action on Banco do Estado do Par S.A. (Banpar ) on Oct. 11, 2013, when the rating agency assigned first-time ratings to Banpar , including a ba3 baseline credit assessment, a Ba3/Not Prime global local- and foreign-currency deposit ratings, long- and short-term, respectively; as well as A2.br/BR-2 long- and short-term Brazilian national scale deposit ratings. All ratings were placed on stable outlook. Moody's took its last rating action on Banco Original S.A. (BOM) and on its sister-bank Banco Original do Agroneg¢cio S.A. (BOA) on Oct. 23, 2014, when the rating agency affirmed the global scale ratings assigned to both BOM and BOA, including the b1 baseline credit assessment, the B1/Not Prime long- and short-term local and foreign-currency deposit ratings. At the same time, Moody's upgraded these banks' long-term Brazilian national scale deposit ratings to Baa1.br, from Baa2.br, as well as the BR-2 for short- term. The outlook remained stable for all ratings. Moody's took its last rating action on Banco Indusval S.A. (BI&P) on Sep. 8, 2014, when the rating agency downgraded the ratings assigned to BI&P, including the long-term global local and foreign currency deposit ratings to B1 from Ba3, as well as the long- and short-term Brazilian national scale deposit rating, to Baa2.br and BR-3 from A2.br and BR-2, respectively. At the same time, Moody's lowered the baseline credit assessment to b1, from ba3. The short- term global ratings remained unchanged at Not Prime. The outlook on all ratings was changed to stable from negative. Moody's took its last rating action on Banco Modal S.A. (Modal) on Sep. 8, 2014, when the rating agency downgraded the ratings assigned to Modal, including the long-term global local and foreign currency deposit ratings to B1 from Ba3, as well as the long- and short-term Brazilian national scale deposit rating, to Baa2.br and BR-3 from A2.br and BR-2, respectively. At the same time, Moody's lowered the baseline credit assessment to b1, from ba3. The short-term global ratings remained unchanged at Not Prime. The outlook on all ratings remained stable. Moody's took its last rating action on Banco Paulista S.A. (Paulista) on Oct. 24, 2013, when the rating agency downgraded its long-term local- and foreign-currency deposit ratings to B2, from B1, and lowered the baseline credit assessment (BCA) to b2, from b1. Moody's also downgraded Paulista's long-term Brazilian national scale rating to Baa3.br, from Baa2.br. The outlook on all ratings remained stable. Moody's took its last rating action on BES Investimento do Brasil S.A.(BESI Brazil) on Dec. 19, 2014, when the rating agency confirmed BESI Brazil's B2 long-term global local- and foreign- currency deposit ratings and its Ba2.br long-term Brazilian national scale deposit rating. The outlook on these ratings remained developing. At the same time, the bank's unsupported baseline credit assessment (BCA) was maintained at b2. The Not Prime short-term global local- and foreign-currency deposit ratings and the BR-4 short-term Brazilian national scale deposit ratings were also affirmed. This rating action followed an announcement about the sale of Portugal's Banco Espirito Santo de Investimentos S.A. (unrated), BESI Brasil's controlling shareholder, to Haitong Securities Company Limited (unrated), made on Dec. 8, 2014. MDL REALTY: Moody's Downgrades CFR to Caa1, Outlook Negative ------------------------------------------------------------ Moody's America Latina downgraded the corporate family ratings assigned to MDL Realty Incorporacoes S.A. to Caa1 from B3 on the global scale and to Caa1.br from Ba3.br on the Brazilian national scale. At the same time, Moody's has downgraded to Caa1/Caa1.br from B3/ Ba3.br the ratings assigned to the company's BRL100 million senior secured debentures due in 2018. Moody's has also changed the outlook on the ratings to negative from stable. Issuer: MDL Realty Incorporacoes S.A. (MDL Realty) Ratings downgraded: -- Corporate Family Ratings: to Caa1 from B3 (global scale) and to Caa1.br from Ba3.br (national scale) -- BRL100 million senior secured debentures due in 2018: to Caa1/Caa1.br f from B3/Ba3.br The outlook of all ratings changed to negative from stable The downgrade of MDL Realty's ratings was prompted by an ongoing deterioration in the company's credit metrics and liquidity profile driven, not only by a deterioration in homebuilding industry fundamentals, but also due to changes in its capital structure as per large intercompany loans denominated in US dollars that resulted in increased exposure to foreign currency volatility and higher debt costs. The negative outlook reflects the difficulties ahead of the management to improve its cash generation and financial risk profile amid weak macroeconomic trends and challenging industry fundamentals over the next twelve to eighteen months. MDL Realty's Caa1/Caa1.br ratings reflect its: (i) small size and limited revenue diversification when compared to its international peers and local competitors, (ii) limited track record of operations as an integrated homebuilder and associated execution risks, and (iii) weak corporate governance practices and financial policies compared to other public rated peer companies. Other factors constraining MDL Realty's rating include its high leverage and growing exposure to foreign currency volatility. These risks are partially mitigated by MDL Realty's attractive operating margins, expected improvement in internal cash flow generation from project completion and the track record of equity support from the shareholders. The deterioration in the overall homebuilding industry dynamic has been driven by a sharp contraction in consumer confidence, based on Brazil's macroeconomic and political uncertainties that are contributing to an increase in unemployment rates, lower disposable income and reduced funding availability for home acquisition. Moody's anticipates continued pressure in homebuilders' cash flows from sales cancellations in 2015, along with delays in the process of credit takeout after project completions and some deterioration in real estate prices, particularly in the middle income housing segment. In 2014, MDL Realty launched approximately BRL134 million in potential sales value (PSV) representing a 60% decrease over the launches in 2013. Historically, the company's launches have been in the range of BRL 250 million to BRL350 million per year. Similar to other local homebuilders, the company has adjusted its growth strategy to preserve cash in face of weaker sales speed and a longer than expected cash conversion cycle. Nevertheless, the ratio of cash availability to short term debt maturities has decreased to 17% in 2014 from 44% in 2013, while the gross debt to capitalization ratio increased to 64.4% in 2014, up from 60.5% in 2013. In the absence of a significant change in the company's capital structure, Moody's expect leverage to reach 70% in 2015. A ratings upgrade is unlikely at this time, but Moody's could consider an outlook stabilization if the company balances its capital structure and improves its financial risk profile in order to maintain a higher cash balance availability that covers at least 100% of its debt service in the short term. Rating's upward pressure would also depend on improvement in corporate governance or in market fundamentals, leading to revenue growth and/or better than expected credit metrics. MDL Realty's rating could be further downgraded if the company faces a continued deterioration in its leverage and liquidity profile leading to a distressed exchange or significant loss to creditors. Quantitatively the ratings could be further downgraded if total debt to capitalization ratio increases above 70% or if its EBIT to interest coverage falls below 1.0x. MDL Realty Incorporadora S.A. (MDL Realty) is a private company headquartered in Rio de Janeiro, Brazil. The company is a regional niche player in the fragmented Brazilian homebuilding market. Despite its origin as a developer in the mid-low income housing segment, the company is now focused in the real estate development for the middle and high income segments markets in the states of Rio the Janeiro and Sao Paulo, currently with a backlog of 11 projects under construction. In 2014, MDL reported net revenues of BRL452 million (USD 193 million) and net income of BRL35million (US$15 million). ========================== C A Y M A N I S L A N D S ========================== AEM SELECT: Members' Final Meeting Set for June 24 -------------------------------------------------- The members of AEM Select Fund, Ltd. will hold their final meeting on June 24, 2015, at 1:00 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 BLUE SKY: Members' Final Meeting Set for June 22 ------------------------------------------------ The members of Blue Sky will hold their final meeting on June 22, 2015, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: CDL Company Ltd. P.O. Box 31106 Grand Cayman KY1-1205 Cayman Islands CAL DIVE: Commences Liquidation Proceedings ------------------------------------------- On May 11, 2015, the sole shareholder of Cal Dive Offshore Services, 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: Quinn J. Hebert 2500 CityWest Blvd. Suite 2200, Houston Texas 77042 USA Telephone: (713) 361-2600 Facsimile: (713) 587-7338 CBRE COF: Commences Liquidation Proceedings ------------------------------------------- On May 13, 2015, the sole member of CBRE COF Management 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: Jean-Francois Gillard Flat 4, Grd/F, Blk F Deepdene 55 Island Road Deep Water Bay Hong Kong GGI SRI: Members' Final Meeting Set for June 24 ----------------------------------------------- The members of GGI SRI, Ltd. will hold their final meeting on June 24, 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 ML KNIGHT 2003: Members' Final Meeting Set for June 24 ------------------------------------------------------ The members of ML Knight 2003 Holding Corp. will hold their final meeting on June 24, 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 ML KNIGHT 2003 INVESTOR: Members' Final Meeting Set for June 24 --------------------------------------------------------------- The members of ML Knight 2003 Investor Corp. will hold their final meeting on June 24, 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 PRESTIGE AIRCRAFT: Shareholders' Final Meeting Set for June 30 -------------------------------------------------------------- The shareholders of Prestige Aircraft Leasing (Pal), Inc. will hold their final meeting on June 30, 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: Appleby Trust (Cayman) Ltd. c/o Richard Gordon Telephone: +1 (345) 949 4900 75 Fort Street P.O. Box 1350 Grand Cayman KY1-1108 Cayman Islands RENUK LIMITED: Members' Final Meeting Set for June 22 ----------------------------------------------------- The members of Renuk Limited will hold their final meeting on June 22, 2015, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: CDL Company Ltd. P.O. Box 31106 Grand Cayman KY1-1205 Cayman Islands ZENITH LIFE: Commences Liquidation Proceedings ---------------------------------------------- At an extraordinary meeting held on April 17, 2015, the members of Zenith Life Reinsurance Company, SPC resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Stuart Jessop 5th Floor, Windward 3 Regatta Office Park, West Bay Road Grand Cayman KY1-1105 Cayman Islands ========= C H I L E ========= AUTOMOTORES GILDEMEISTER: Moody's Lowers Global Scale CFR to B3 --------------------------------------------------------------- Moody's Investors Service downgraded Automotores Gildemeister ("AG")'s global scale corporate family rating to B3. At the same time, Moody's downgraded its Senior Unsecured Notes due 2021 and 2023 to B3. The outlook for the ratings remains negative. The following ratings have been downgraded: Issuer: Automotores Gildemeister S.A. -- Corporate Family Rating: to B3 from B2 (global scale) -- US$400 million Senior Unsecured Notes due 2021: to B3 from B2 (foreign currency) -- US$300 million Senior Unsecured Notes due 2023: to B3 from B2 (foreign currency) The downgrade to B3 primarily reflects AG's weakened credit metrics and liquidity profile. Contrary to our initial expectations for the year, performance recovery will be very gradual as a result of weak vehicle sales trends experienced both in Chile and Peru, with modest impacts in the company's credit metrics in 2015. The company's leverage, as measured by Moody's adjusted debt-to-EBITDA, has shown strong deterioration over the last year as a result of the negative impacts coming from the Brazilian operations. Still, even after the removal of such effect, we estimate leverage to remain above 10 times over the next two years. In terms of liquidity, although AG will not face material debt maturities in the short term, its cash position of USD 55mm as of March 2015 is modest when compared to its combined upcoming debt maturities, interest expenses and capex, among other expense needs. Mitigating this concern is some extent is the company's significant amount of unencumbered inventory, of about USD 300 million as of March 31 2015, that could be used for liquidity purposes. Gildemeister's B3 rating still considers its solid market position as one of the leading automotive distributors and retailers in its markets in Chile and Peru. The rating also incorporates the benefit of Gildemeister's hybrid business model as both a distributor and retailer of car brands which has resulted in historically above average operating margins when compared to the traditional U.S. based auto retailers. Gildemeister's ratings are constrained by its very weak credit metrics, high dependence on the Hyundai brand, as well as the cyclical nature of the automotive industry and light vehicle sales, which is easily affected by changes in consumer preferences and product mix. The negative outlook reflects Gildemeister's deteriorating liquidity, credit metrics and weak margins. The negative outlook also reflects the company's exposure to a slowing macroeconomic environment throughout Latin America, particularly in Chile and Peru, which will likely strain demand growth in 2015 and 2016 and increase pressure on profitability. Gildemeister's ratings could be further downgraded if liquidity worsens or if the company is unable to significantly improve current credit metrics. The ratings or outlook could also be downgraded in case its agreement with Hyundai were to be unfavorably altered. Structurally, a substantial increase in secured debt could also lead to a downgrade of the B3 rating on the senior unsecured bonds. Although an upgrade is unlikely in the near to-medium-term, the ratings could be stabilized if Gildemeister's liquidity improves, adjusted debt to EBITDA were to reduce sustainably to below 8.0x and interest coverage is maintained above 1.0x. The principal methodology used in these ratings was Global Retail Industry published in June 2011. Gildemeister S.A., headquartered in Santiago, Chile, is one of the largest importers and distributors in Chile and Peru operating a network of company-owned and franchised vehicle dealerships. Its principal car brand is Hyundai for which it is the sole importer in both of its markets. For the last twelve months ended March 31, 2015, Gildemeister reported consolidated net revenues of about USD 1.4 billion with approximately 58.1% being generated from its key market, Chile. =============== C O L O M B I A =============== ISAGEN SA: Defeated Ex-CFO Reemerges to Upend Privatization Plan ---------------------------------------------------------------- Christine Jenkins and Jonathan Levin at Bloomberg News report that Rodrigo Toro, Isagen's former chief financial officer, isn't going to watch his old company be sold off without a fight. The 62-year-old engineer, who led a failed attempt to buy the Colombian state-controlled hydropower producer in 2013, is among a group that successfully sued to suspend the latest auction last month of the government's COP5.3 trillion ($2.1 billion) majority stake, according to Bloomberg News. Bloomberg News relates that the delay has left bidders from Canada to Europe in limbo on a transaction that could have highlighted Colombia's potential as an investment destination and helped offset slowing economic growth. Instead, it has become a reminder of the difficulty of doing business in the Latin American nation, drawing attention to a legal and administrative system the World Economic Forum ranks below those in Guatemala and Honduras, the report notes. "What happened with Isagen SA is definitely a bad signal for international investors," Mario Castro, a Colombia strategist at Nomura Holdings Inc., told Bloomberg in a telephone interview from New York. "It makes clear one of the institutional weaknesses of the country: legal uncertainty," Mr. Castro added. Bloomberg News notes that the government said canceling the sale would be a setback in funding President Juan Manuel Santos's signature infrastructure initiative, known as 4G, according to a response filed with the court. It's meant to overhaul roads the economic forum says are worse than those in Bolivia and Kyrgyzstan, Bloomberg News relays. The government established a development-bank fund to help construction companies finance spending on 4G projects, and the Isagen SA sale was supposed to provide equity, according to a November 2013 Colombian Finance Ministry presentation, Bloomberg News says. 400 Workers The court in charge of the case based the suspension on three complaints: one from a union, one from a workers' group and -- "especially," according to court documents -- the suit by Mr. Toro, who worked at the company for 14 years and says he represents more than 400 current and former workers who want to buy the business, Bloomberg News discloses. Bloomberg News says that Mr. Toro, speaking in a telephone interview from Medellin, said he was called in to lead the "crusade" for a worker takeover during the 2013 sales effort. While he's not against the transaction in principle this time, Mr. Toro said his group didn't get fair treatment, Bloomberg News relays. Under Colombian law, the government must offer special conditions during privatizations to current and former workers and related pension funds, Bloomberg News discloses. That means first offering shares to this so-called solidarity sector before proceeding to a second phase that opens shares to the public -- including foreign funds and corporations, Bloomberg News relays. Buying Restrictions Bloomberg News discloses that Mr. Toro and his group held talks with advisers and lenders, including Banco Itau BBA SA, Morgan Stanley and KPMG LLP, and intended to buy shares in the first round of the sale. Instead, Mr. Toro said the government placed unfair restrictions on the number of shares they could buy, Bloomberg News relays. Pablo Cardenas, coordinator of the Finance Ministry's legal affairs group, said in an e-mailed response to questions that the government's opponents in the case are trying to confuse the public and "sabotage the process," Bloomberg News notes. Mr. Cardenas said share limits are meant to discourage outsiders who may try to game the system by buying shares through the workers, Bloomberg News notes. "The limits on this process are the same that have always existed in other sales," Bloomberg News quoted Mr. Cardenas as saying. They are "limits that until now have been validated in court on various occasions," Bloomberg News says. A definitive ruling on the lawsuits may take as long as three months, according to a May 20 e-mailed response to questions from Magistrate Hugo Bastidas, Bloomberg News relays. Demand Outlook Colombia's Energy Ministry projects electricity demand will grow 3.6 percent a year during the next five years, making Isagen SA appealing to foreign companies that already have a foothold, including Toronto-based Brookfield Asset Management Inc., Bloomberg News discloses. Bloomberg News notes that Brookfield is among the bidders, along with Courbevoie, France-based Engie, formerly known as GDF Suez SA, and Colbun SA in Santiago. Colbun SA said it would wait for the Colombian courts to resolve the matter before considering its next steps, Bloomberg News relays. The difficulty of selling Isagen SA underscores the prickly nature of state-asset sales, Bloomberg News says. Most Colombian adults still remember the blackouts of the 1990s, which spawned changes in electricity policy and helped spur the creation of Isagen 20 years ago, Bloomberg News notes. The government said in its response to the court last month that it gets a 3.5 percent dividend yield on its Isagen SA investment, Bloomberg News discloses. If it invests the same amount of money in infrastructure loans, it said it can earn a 5 percentage point spread over inflation, which is currently 4.41 percent, Bloomberg News notes. Bad Timing The delay in the sale comes at a time when Colombia is least able to handle a hit to its infrastructure plans and cross-border investment flows, according to Mr. Castro, Bloomberg News discloses. Oil, which has plummeted 44 percent in price during the past year, accounts for more than half of exports and about 30 percent of foreign direct investment, Bloomberg News notes. The government also depends on oil revenue to subsidize spending, Bloomberg News says. The economy grew at the slowest pace in two years during the first quarter as manufacturing and mining output contracted, Bloomberg News notes. "If the sale doesn't happen in the end, it puts at risk the development of these infrastructure projects," Bloomberg News quoted Mr. Castro as saying. "I don't see many options for the government to replace these $2 billion," Mr. Castro added. Isagen SA is the operator of Colombia's largest hydropower plant. * * * As reported in the Troubled Company Reporter-Latin America on May 27, 2014, Bloomberg News said that Isagen SA may fall in Bogota trading after Oscar Ivan Zuluaga, who opposes the sale of the government's stake in the power company, led the first round of Colombia's presidential vote, according to Bancolombia SA. Mr. Zuluaga, an ally of former President Alvaro Uribe, won 29.3 percent of the votes with 99.9 percent of polling stations reporting. Mr. Santos, 62, had 25.7 percent. The two candidates are set for a runoff June 15. TCRLA reported on April 4, 2013, Fitch Ratings has upgraded Isagen S.A. ESP's Foreign and Local Currency Issuer Default Ratings (IDRs) to 'BBB-' from 'BB+'. The Rating Outlook has been revised to stable from positive. ============= J A M A I C A ============= JAMAICA: Consumer Prices up in May ---------------------------------- RJR News reports that consumer prices rose by an average 0.5% in May. The increase was largely attributable to rises in the prices of vegetables and starches, as well as electricity, gas and other fuel, outweighing declines in the prices of water and miscellaneous services, according to RJR News. Over the last twelve months, consumer prices have gone up by four per cent, the report notes. * * * As reported in the Troubled Company Reporter-Latin America on June 5, 2015, Standard & Poor's Ratings Services raised its long- term foreign and local currency sovereign credit ratings on Jamaica to 'B' from 'B-'. In addition, S&P affirmed the 'B' short-term ratings on Jamaica. The outlook on the long-term ratings is stable. S&P also raised the transfer and convertibility assessment to 'B+' from 'B'. =========== M E X I C O =========== CORPORACION GEO: Judge Approves Debt Restructuring Plan ------------------------------------------------------- Gabriela Lopez at Reuters reports that a Mexican judge said he had approved the debt restricting plan for Mexican homebuilder Corporacion GEO Sab de CV, which entered into bankruptcy protection in April 2014. The judge said bankruptcy protection for Geo and four of its units was over, according to a court statement, Reuters notes. A ruling has not yet been issued for Geo's 11 other subsidiaries, the report relays. The report recalls that the company's shares have been suspended since 2013 because it was not reporting financial statements. Geo's shareholders approved the debt restructuring plan in May, which included raising MXN34.16 billion ($2.21 billion) of capital by issuing 60.9 million new shares in exchange for liabilities, the report notes. Geo board President and Director Luis Orvananos said in a statement that the court decision would enable the company to recover its operational and financial viability, adds the report. Corporacion GEO Sab de CV, through its sunsidiaries, designs and contructs entry-level housing communities in Mexico and Chile. GEO acquires land, obtains permits, installs infrastructure improvements, and builds and markets hoising developments. * * * As reported by the Troubled Company Reporter-Latin America on March 24, 2014, Corporacion GEO SAB de CV said it filed for bankruptcy protection in Mexico with a prearranged restructuring plan it hopes will get the struggling company building again, according to Amy Guthrie at The Wall Street Journal. GEO SAB is one of three major Mexican home builders struggling with serious cash restraints amid drastic changes in Mexico's low-income housing sector, the report added. The TCRLA on April 2, 2014, reported that Moody's Investors Service downgraded Corporacion GEO, S.A.B de C.V's (GEO)'s global scale foreign currency senior unsecured debt rating to C from Ca as a result of GEO's filing of a judicial recovery request. ================================ T R I N I D A D & T O B A G O ================================ TRINIDAD & TOBAGO: Gov't Concerned at Rising Household Debt ----------------------------------------------------------- Verne Burnett at Trinidad and Tobago Newsday reports that Finance Minister Larry Howai suggested that the Government may have to look at regulating the competition among retail store chains to sell consumer goods to the public. In a speech delivered on Mr. Howai's behalf by Minister of State in the Ministry of Finance, Rudranath Indarsingh, the Minister of Finance said the Government had begun developing a National Financial Crisis Management Plan which would provide for an orderly resolution of any crisis in future faced by any of the financial institutions deemed to be systemically important and regulated by the Central Bank, according to Trinidad and Tobago Newsday. However, Mr. Howai raised concerns about institutions which are not regulated by the Central Bank, saying that the current low interest rate environment had caused many households to take on more debt and had also created "fertile ground" for retail store chains to compete to lend to households, the report notes. The speech was delivered at the First Caribbean Fraud Conference, "Promoting a Stable Financial Sector" organized by the Trinidad and Tobago Coalition of Service Industries (TTCSI) and Global Forensic Institute at the Hilton Trinidad and Conference Centre, the report relays. "According to the Central Bank of Trinidad and Tobago, anecdotal evidence suggests certain retail chains, which are neither regulated by the Central Bank nor any other authority have been rapidly increasing their sales of consumer durables on hire purchase terms to households. One can surmise that as these retail stores compete for market share in an unregulated environment, there may be greater incentives for these retail stores to underprice risk. This can have a negative impact on these retail stores as well as consumers exposed to interest rate risk in the event of rising domestic interest rates and negative economic shocks. If these activities remain unregulated they can pose a systemic risk to the domestic financial system," Mr. Howai said in the speech delivered by Indarsingh, the report notes. Mr. Howai added that 617 suspicious activities and transactions with a total value of $698 million were reported to the Financial Intelligence Unit (FIU) last year, the report relays. The speech referred to the recent introduction of the $50 polymer currency notes in the country, observing that these notes were more difficult to counterfeit because of the advanced security features they contain. "The possibility of the total conversion of all the remaining denominations of local currency into polymer bank notes would certainly be supported by the Ministry of Finance and the Economy. A more secure currency notes system would certainly lead to a more stable financial system." Susan Francois, director of the FIU, said that 88 of the 617 suspicious transactions reported to the unit in 2014 were fraud related, the report relays. Ms. Francois said there had been an increase in the reports of suspicious transactions made to the FIU between 2010 and 2014 and attributed this to the work done by the unit in training and sensitizing the country's financial institutions and businesses in recognizing and reporting suspicious transactions, the report adds. *********** 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 * * *