/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/170605.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 Monday, June 5, 2017, Vol. 18, No. 110 Headlines B A R B A D O S BARBADOS: OKs Controversial National Social Responsibility Act BARBADOS: Tax Measures Unsustainable, Accountants Argue B R A Z I L BANCO AHORRO: S&P Affirms B Global Scale Rating, Outlook Negative BRASIL DISTRESSED: Shifts Partnership, Boosts Target BRAZIL: Senator Aligned With Temer Accuses of Accepting Bribes TRANSMISSORA ALIANCA: S&P Keeps BB Global Scale CCR on Watch Neg. TUPY SA: S&P Affirms BB- Global Scale CCR, Outlook Still Stable C A Y M A N I S L A N D S BARRINGTON PROPERTIES: Creditors' Proofs of Debt Due June 12 BEAULIEU PROPERTIES: Creditors' Proofs of Debt Due June 12 CHESTNUT HOLLOW I: Commences Liquidation Proceedings CHESTNUT HOLLOW II: Commences Liquidation Proceedings CHESTNUT HOLLOW III: Commences Liquidation Proceedings FPCM INVESTMENT: Commences Liquidation Proceedings MOORE STEPHENS: Commences Liquidation Proceedings ORBY LTD: Commences Liquidation Proceedings SPRUCE BROOK I: Commences Liquidation Proceedings D O M I N I C A N R E P U B L I C EMPRESA GENERADORA: S&P Affirms BB- CCR, Outlook Still Stable E C U A D O R ECUADOR: S&P Rates $2-Bil. Series of Unsecured Notes 'B' G U A T E M A L A GUATEMALA: S&P Assigns 'BB' Rating to US$500MM Notes Due 2027 M E X I C O BANCO MONEX: S&P Puts 'BB+' Rating on CreditWatch Negative CONSUBANCO SA: S&P Lowers ICR to 'BB-' & Puts on Watch Neg. FINCOMUN SERVICIOS: S&P Affirms 'B+/B' Global Scale Rating GRUPO FAMSA: S&P Affirms B Global Scale CCR, Outlook Negative P A R A G U A Y VISION BANCO: S&P Affirms 'B' ICR; Outlook Remains Stable T R I N I D A D & T O B A G O DENNY'S: Forced to Close its Doors X X X X X X X X X * BOND PRICING: For the Week From May 29 to June 2, 2017 - - - - - =============== B A R B A D O S =============== BARBADOS: OKs Controversial National Social Responsibility Act -------------------------------------------------------------- RJR News reports that the Barbados Parliament approved the controversial National Social Responsibility Act after Minister of Finance Chris Sinckler put up a strident defense of the tax on imported and locally produced goods. The tax is due to be increased from two to 10 per cent, effective July 1, according to RJR News. Two government ministers warned that it is impossible to tax their way out of the country's economic problems, the report notes. As reported in the Troubled Company Reporter-Latin America on March 7, 2017, S&P Global Ratings lowered its long-term foreign and local currency sovereign ratings on Barbados to 'CCC+' from 'B-'. The outlook is negative. S&P also lowered the short-term ratings to 'C' from 'B.' At the same time, S&P lowered its transfer and convertibility assessment for Barbados to 'CCC+' from 'B-'. BARBADOS: Tax Measures Unsustainable, Accountants Argue ------------------------------------------------------- RJR News reports that the Institute of Chartered Accountants of Barbados (ICAB) is describing as unsustainable, the tax measures introduced by its government. Executive Director Reginald Farley said ICAB was concerned that missing from the Budget presentation was a suggested date by which the taxes would be phased out, according to RJR News. The increased cost to businesses and consumers will further worsen Barbados' international competitiveness and its ability to sell goods and services to earn foreign exchange, he contended, the report notes. Among the measures announced by Minister of Finance Chris Sinckler were an increase in excise on fuels, a 500 per cent rise in the National Social Responsibility Levy and a two per cent fee on foreign exchange transactions, the report adds. As reported in the Troubled Company Reporter-Latin America on March 7, 2017, S&P Global Ratings lowered its long-term foreign and local currency sovereign ratings on Barbados to 'CCC+' from 'B-'. The outlook is negative. S&P also lowered the short-term ratings to 'C' from 'B.' At the same time, S&P lowered its transfer and convertibility assessment for Barbados to 'CCC+' from 'B-'. =========== B R A Z I L =========== BANCO AHORRO: S&P Affirms B Global Scale Rating, Outlook Negative ----------------------------------------------------------------- S&P Global Ratings revised its outlook on Banco Ahorro Famsa (BAF) to negative from stable. We also affirmed our 'B' global scale and 'mxBBB-/mxA-3' national scale ratings on the bank. The rating action on BAF follows the similar action on Grupo Famsa S.A.B. de C.V. (GFamsa; B/Negative/--), which owns 100% of the bank. We maintain our view of BAF as core entity of GFamsa. The negative outlook on BAF reflects that on its parent, GFamsa, because we consider the bank as a core subsidiary and its rating will continue to move in tandem with its parent's. The negative outlook on GFamsa reflects our view that business and financial challenges that it faces, due to a fierce competition and sluggish economic growth in Mexico, could pressure its margin and constrain its ability to further deleverage its capital structure. BRASIL DISTRESSED: Shifts Partnership, Boosts Target ---------------------------------------------------- Cristiane Lucchesi and Felipe Marques at Bloomberg News report that Brasil Distressed, the troubled-asset buyer also known as BrD, shuffled its partnership and said it plans to step up purchases this year. BrD aims to invest in as much as BRL1.5 billion ($460 million) in soured debt from mid-size Brazilian companies, two-thirds more than it bought last year, Carlos Catraio, a managing partner, said in an interview, according to Bloomberg News. The firm has purchased about BRL3 billion in debt since it was created in 2010. In addition, BrD named Marcio Fujita a managing partner to replace Jose Guilherme Lembi de Faria, who's left the company, according to Catraio, Bloomberg News notes. Fujita and Catraio together own 68 percent of BrD, Bloomberg News relays. The remaining 32 percent was sold to Araba Comercio de Bens e Participacoes Ltda., controlled by Portugal's Lapa family, Bloomberg News says. Small and medium-size companies are among the most damaged by Brazil's two-year recession, with roughly 14 percent of their loans delinquent or already restructured, according to central bank data from December, the most recent available, Bloomberg News notes. That's up from about 11 percent a year earlier. Data from Serasa Experian shows that 94 mid-size companies asked for court protection from creditors this year through April, down from an all-time high of 149 in the same period of 2016, Bloomberg News says. Credit Recovery "The crisis generates potential raw material, but it also increases the difficulty of credit recovery because fewer companies are able to survive," the report quoted Mr. Catraio as saying. More firms have been repaying debts in the past few months as Brazil's economy shows signs of recovery from the downturn, the worst in the nation's history, he said. That's why BrD gave up on some sectors, including companies that provide heavy machinery to the construction industry, according to Mr. Catraio, Bloomberg News notes. "In this environment, like the rest of the credit market we became more cautious," said Fujita, who was named a managing partner in February, according to his LinkedIn page. BrD's purchases are typically in the range of BRL1 million to BRL30 million, and the company doesn't buy retail portfolios or legal claims, Mr. Catraio said. "We have also been buying offshore debt from Brazilian debtors," he added. Distressed asset investors have been flocking to Brazil. Lone Star Funds, founded by billionaire John Grayken, is buying Apoema Capital Partners, a Brazilian firm that manages about BRL4.5 billion in distressed assets, a person with knowledge of the matter said in April, Bloomberg News relays. Canvas Capital SA, backed by Credit Suisse Group AG, is raising a fund of as much as $600 million to invest in distressed corporate assets in Brazil, people said in March, Bloomberg News notes. "We might consider joining forces with an international distressed player," said Mr. Catraio, adding that no such talks are under way yet, Bloomberg News adds. BRAZIL: Senator Aligned With Temer Accuses of Accepting Bribes -------------------------------------------------------------- Paulo Trevisani at The Wall Street Journal reports that Brazil's top prosecutor leveled corruption charges against Sen. Aecio Neves, one of country's most influential politicians, deepening a severe political crisis that has tarnished much of the political class. Attorney General Rodrigo Janot accused Mr. Neves of taking about $615,000 in bribes from Joesley Batista, the former chairman of meatpacker JBS SA, according to WSJ. He was also accused of trying to obstruct the sprawling graft investigation known as Operation Car Wash, which has ensnared business executives, lawmakers and former presidents, the report notes. A lawyer for Mr. Neves, who was until recently considered a possible presidential candidate, said his client hadn't seen the charges and couldn't comment. Mr. Batista last month cut a plea deal with Mr. Janot's office, admitting to having paid bribes to Mr. Neves and other politicians in exchange for cheap loans from Brazil's giant development bank, the report relays. The holding company for JBS, the world's largest meatpacker, agreed earlier this week to pay a $3.2 billion penalty in exchange for leniency in what has turned into a sweeping corruption probe into the company's efforts to win favor with lawmakers, the report notes. The Supreme Court will now decide whether to accept the charges against Mr. Neves, since a sitting federal lawmaker can only be tried by the high court, as per Brazilian law, the report relays. Mr. Neves, though still a senator, cannot cast a vote or participate in congressional hearings, the report discloses. The charges are a blow to embattled President Michel Temer because Mr. Neves has been a strong supporter of the controversial economic reforms the government has proposed, the report relays. Mr. Neves, who finished second in the 2014 presidential election, had been the president of the powerful Brazilian Social Democracy Party until May, when Mr. Batista's accusations against him became public, the report notes. Mr. Batista has also accused Mr. Temer of authorizing hush money payments to Eduardo Cunha, a jailed former lawmaker who had close ties to the president, the report says. Mr. Temer has strongly denied the allegations. As reported in the Troubled Company Reporter-Latin America on May 24, 2017, S&P Global Ratings placed its 'BB' long-term foreign and local currency sovereign credit ratings on the Federative Republic of Brazil on CreditWatch with negative implications. S&P also affirmed the short-term foreign and local currency ratings at 'B'. The transfer and convertibility assessment is unchanged at 'BBB-'. In addition, S&P placed the 'brAA-' national scale rating on CreditWatch with negative implications. TRANSMISSORA ALIANCA: S&P Keeps BB Global Scale CCR on Watch Neg. ----------------------------------------------------------------- S&P Global Ratings kept its 'BB' global scale and 'brAA-' Brazil national scale corporate credit ratings on Transmissora Alianca de Energia Eletrica S.A. (Taesa) on CreditWatch with negative implications. The company's 'bbb-' stand-alone credit profile (SACP) remains unchanged. At the same time, S&P's 'brAA-' issue- level rating on Taesa's third debentures' issuance of R$2.2 billion in three series due 2024 remains on CreditWatch negative. The CreditWatch update reflects the ratings on the Federative Republic of Brazil (Brazil: BB/Watch Neg/B; brAA-/Watch Neg/--) cap on those on the company. In S&P's view, Taesa has an appreciable likelihood of following the sovereign in a default scenario, as other companies that operate in a regulated environment. In this scenario, Taesa would be subject to tariff controls, and we believe that revenue collection and credit availability could suffer. The regulatory framework in Brazil for electric power transmission segment is proven and favorable, allowing a stable and predictable revenue stream derived from the permitted revenues model (Receita Anual Permitida)[RAP]) related to the availability of the transmission lines, rather than the actual volume of power it transmits. In S&P's view, this shields the segment from electricity demand volatilities and an adverse macroeconomic scenario. Taesa has recently shifted its growth strategy from acquisitions to one based on greenfield projects. This entails execution risk, but S&P expects the company to leverage on the expertise of its controlling shareholders. Taesa participated in the last three regulatory transmission auctions, because of higher rates of return and longer tenors (five instead of three years) to build these lines and some flexibility to perform the required investments. This, in S&P's view, will help the company to replace cash flows of some of its transmission lines that are getting closer to the middle of their concession terms, when revenues are reduced by half, according to their concession contracts. Taesa is planning to build seven new assets in the next few years (four of them in partnership with other players), which will require about R$2.9 billion investments from the company that's likely to be mostly financed through new debt. TUPY SA: S&P Affirms BB- Global Scale CCR, Outlook Still Stable --------------------------------------------------------------- On May 30, 2017, S&P Global Ratings affirmed its 'BB-' global scale and 'brA' national scale corporate credit ratings on Tupy S.A. The outlook remains stable. At the same time, S&P affirmed the 'BB-' issue-level rating on the company's 2024 notes. The '3' recovery rating on these notes remains unchanged, reflecting S&P's expectation of meaningful recovery (65%) in the event of payment default. The ratings affirmation reflects S&P's view that Tupy's cost efficiency measures should bolster profitability and cash flow generation, allowing the company to reduce debt. This will likely strengthen debt to EBITDA to 3.5x by the end of 2017, from 4.5x in 2016. Some examples of these measures are the reduction of its labor force and closing part of the Maua plant recently, which will increase capacity utilization to about 65% from 55% in 2016. As a result, S&P expects EBITDA margin of about 14.5% in 2017, compared with 12.9% in 2016. At the same time, the company expects to increase the contribution of more value-added products by raising the share of fully machined products in its portfolio, which should also gradually strengthen profitability. S&P continues to consider Tupy's concentration on few products and customers and the commodity-like nature of its products amid stiff competition as a rating limitation because it could result in future cash flow volatility. In S&P's view, this is only partly compensated by Tupy's leading position in the cast iron engine blocks and heads market in Americas and Europe and its geographic diversification, with North America representing 61.8% of revenue, followed by Latin America (17.4%), Europe (12.3%) and Asia-Pacific and Africa (8.5%) during the first quarter of 2017. For 2017, S&P believes that North America will make up the bulk of Tupy's revenues growth. S&P expects a volume growth of 10% in this region during the year, mainly due to increasing production and sales of commercial and off-road vehicles, already taking into consideration the strong volume growth of 17.3% in the first quarter over a year-earlier period in North America. On the other hand, Brazil's ongoing political and macroeconomic uncertainties should weaken Tupy's domestic sales. However, for 2018, S&P expects better macroeconomic perspectives for Brazil to result in volume growth of 10%, due to increased production and sale of commercial and passenger's vehicles. S&P's base-case scenario for Tupy assumes: - U.S. GDP growth of 2.3% in 2017 and 2.4% in 2018. - U.S. inflation of 2.1% in 2017 and 2.3% in 2018. - Brazil's GDP growth of 0.5% in 2017 and 2.0% in 2018. - Brazil's inflation of 4.6% in 2017 and 4.1% in 2018. - Average exchange rate of R$3.20 per $1.00 in 2017 and R$3.30 per $1.00 in 2018. - Volumes in Brazil to decline by 2.8% in 2017 compared with 2016, due to continued poor demand from end customers that should limit production recovery. Volume growth of 10% in 2018, reflecting a recovery in the sale of vehicles in the country, assuming improving macroeconomic conditions. - A 10% volume growth in the international market in 2017 coming mainly from the North America and from increasing demand for off-road vehicles in Africa. In 2018, a 5% volume growth, reflecting stabilization in sales. - In the domestic market, a price increase in line with past year level. In the international market, a pass-through mechanism and slightly higher prices from potential new contracts to be mitigated by the appreciation of Brazilian real. - Net revenue growth of 8.5% in 2017 and 6.4% in 2018 as a result of the combination of volume and price adjustments. - Stronger profitability in 2017 and 2018 due to lower labor costs and inflation in Brazil and higher capacity utilization. - Capital expenditures (capex) of about R$145 million in 2017 and R$156 million in 2018, mainly for maintenance of operations. - Dividend and interest on shareholders' equity of R$200 million in 2017, which the board already approved, and R$100 million afterwards, assuming it goes back to historical levels. - Debt refinancing of about R$250 million in 2017 and 2018, and payment of the remaining debt maturities with cash flow, which will reduce gross debt. Based on these assumptions, we arrive at the following credit metrics for the next two years: - EBITDA margin of 14.5% in 2017 and close to 17.5% in 2018; - Debt to EBITDA close to 3.5x in 2017 and 2.5x in 2018; - Funds from operations (FFO) to debt close to 22% in 2017 and 31.5% in 2018; and - Free operating cash flow (FOCF) to debt close to 11.5% in 2017 and 20% in 2018. S&P said, "We view Tupy's liquidity as strong, reflecting our expectation that sources over uses of liquidity will exceed 2.0x in the next 12 months and 1.0x over the subsequent 12-month period. Additionally, we forecast that net sources would remain positive even if EBITDA were to decline by 30% from our base-case scenario. "We believe Tupy has a well-established and solid relationship with banks and it shows generally prudent risk management. We expect the company to maintain adequate headroom under its financial covenant of net debt to EBITDA below 3x even if its EBITDA were to decline by 30%. However, we don't believe that the company can absorb high-impact low probability events without refinancing." Principal Liquidity Sources: - Cash position of R$1.1 billion as of March 31, 2017; and - Projected FFO generation of about R$426 million in the next 12 months from March 31, 2017. Principal Liquidity Uses: - Short-term debt of R$306.6 million as of March 31, 2017; - Estimated working-capital needs of about R$40 million in the next 12 months from March 31, 2017; - Estimated capex of about R$148 million in the next 12 months from March 31, 2017; and - Dividend payment and interest on shareholders' equity of R$200 million in 2017. The stable outlook reflects S&P's expectation that Tupy will improve profitability through cost reductions and higher capacity utilization, while it maintains its leading position among the iron blocks and heads manufacturers. For the next 12 months, S&P believe that cash flow generation will come mainly from increasing volumes in the company's international operations that will offset weak results in the domestic market, and result in debt to EBITDA close to 3.5x and FFO to debt around 22%. S&P'could lower the ratings in the next 12-18 months if the company's cash flow generation weakens as a result of lower international volumes due to weaker market conditions or higher competition. In this scenario, S&P would see revenues declining 120bps and gross margin 60bps below its base-case scenario, leading to debt to EBITDA consistently above 4x and FFO to debt below 20%. S&P could also lower the ratings if the these metrics materialize due to a more aggressive expansion plan funded with debt or due to higher foreign-exchange volatility. S&P could raise the ratings over the next 12-18 months if the company presents much higher revenue, EBITDA, and cash flow generation than we expect due to stronger demand mainly in the domestic market. This could result in consistently stronger credit metrics such as debt to EBITDA below 3x and FFO to debt above 30%. ========================== C A Y M A N I S L A N D S ========================== BARRINGTON PROPERTIES: Creditors' Proofs of Debt Due June 12 ------------------------------------------------------------ The creditors of Barrington Properties II Ltd. are required to file their proofs of debt by June 12, 2017, to be included in the company's dividend distribution. The company commenced liquidation proceedings on May 11, 2017. The company's liquidator is: Westport Services Ltd. c/o Avril G. Brophy P.O. Box 1111 Grand Cayman KY1-1102 Cayman Islands Telephone: (345) 949 5122 Facsimile: (345) 949 7920 BEAULIEU PROPERTIES: Creditors' Proofs of Debt Due June 12 ---------------------------------------------------------- The creditors of Beaulieu Properties Limited are required to file their proofs of debt by June 12, 2017, to be included in the company's dividend distribution. The company commenced liquidation proceedings on May 11, 2017. The company's liquidator is: Westport Services Ltd. c/o Avril G. Brophy P.O. Box 1111 Grand Cayman KY1-1102 Cayman Islands Telephone: (345) 949 5122 Facsimile: (345) 949 7920 CHESTNUT HOLLOW I: Commences Liquidation Proceedings ---------------------------------------------------- The sole shareholder of Chestnut Hollow I Holdings, Ltd., on May 11, 2017, passed a resolution 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: Shailini Rao Eton Park 399 Park Avenue 10th Floor New York New York 10022 United States of America Telephone: +1 212 756 5300 CHESTNUT HOLLOW II: Commences Liquidation Proceedings ----------------------------------------------------- The sole shareholder of Chestnut Hollow II Holdings, Ltd., on May 11, 2017, passed a resolution 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: Shailini Rao Eton Park 399 Park Avenue 10th Floor New York New York 10022 United States of America Telephone: +1 212 756 5300 CHESTNUT HOLLOW III: Commences Liquidation Proceedings ------------------------------------------------------ The sole shareholder of Chestnut Hollow III Holdings, Ltd., on May 11, 2017, passed a resolution 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: Shailini Rao Eton Park 399 Park Avenue 10th Floor New York New York 10022 United States of America Telephone: +1 212 756 5300 FPCM INVESTMENT: Commences Liquidation Proceedings -------------------------------------------------- The sole shareholder of FPCM Investment Limited, on May 11, 2017, passed a resolution 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: Walkers Liquidations Limited Cayman Corporate Centre 27 Hospital Road George Town Grand Cayman KY1-9008 Cayman Islands Telephone: +1 (345) 949 0100 MOORE STEPHENS: Commences Liquidation Proceedings ------------------------------------------------- The sole shareholder of Moore Stephens Decosimo Cayman Limited, on May 10, 2017, passed a resolution 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: Russell S. Homer c/o Tanya Armstrong P.O. Box 2499, George Town KYl-1104 Grand Cayman Cayman Islands Telephone: (345) 946-0820 Facsimile: (345) 946-0864 ORBY LTD: Commences Liquidation Proceedings ------------------------------------------- The sole shareholder of Orby Ltd., on May 11, 2017, passed a resolution 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: Shailini Rao Eton Park 399 Park Avenue 10th Floor New York New York 10022 United States of America Telephone: +1 212 756 5300 SPRUCE BROOK I: Commences Liquidation Proceedings ------------------------------------------------- The sole shareholder of Spruce Brook I Holdings, Ltd., on May 11, 2017, passed a resolution 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: Shailini Rao Eton Park 399 Park Avenue, 10th Floor New York New York 10022 United States of America Telephone: +1 212 756 5300 =================================== D O M I N I C A N R E P U B L I C =================================== EMPRESA GENERADORA: S&P Affirms BB- CCR, Outlook Still Stable ------------------------------------------------------------- S&P Global Ratings affirmed its 'BB-' corporate credit and issue- level ratings on Empresa Generadora de Electricidad Itabo S.A. (Itabo). The outlook remains stable. The ratings on Itabo continue to reflect S&P's expectation that despite its conservative credit metrics and adequate liquidity position, the company won't be able to withstand a sovereign stress scenario. As a result, the 'BB-' ratings on the Dominican Republic continue to limit the ratings on Itabo. This is because the country's electricity sector is heavily dependent on subsidies from the government. Therefore, S&P believes that the company's cash flow generation could be damaged under a sovereign default scenario. In turn, Itabo's 'bb' SACP continues to incorporate the company's resilient operating track record in terms of availability and energy production, and its maintenance of operating cost efficiency. In addition, it reflects Itabo's fairly low leverage combined with sound cash flow generation, as seen in its total debt to EBITDA of 1.2x and funds from operations (FFO) to total debt of 63.3% in 2016. On the other hand, Itabo's operation of a single asset, geographic concentration, as well as the challenges of operating in the country's electric power industry -- given its weak regulatory framework with uncertain long-term financial sustainability -- mitigates the positive rating factors. ============= E C U A D O R ============= ECUADOR: S&P Rates $2-Bil. Series of Unsecured Notes 'B' -------------------------------------------------------- S&P Global Ratings assigned its 'B' issue rating on the Republic of Ecuador's series of senior unsecured notes for an aggregate amount of US$2 billion. The ratings on the notes are the same as the foreign currency sovereign credit rating on Ecuador. The US$1 billion notes due June 2023 have a coupon of 8.75%, and the US$1 billion notes due June 2027 have a coupon of 9.625%. RATINGS LIST Republic of Ecuador Sovereign Credit Rating B/Stable/B New Rating Republic of Ecuador US$2 bil. series of notes B ================= G U A T E M A L A ================= GUATEMALA: S&P Assigns 'BB' Rating to US$500MM Notes Due 2027 ------------------------------------------------------------- S&P Global Ratings assigned its 'BB' rating on the Republic of Guatemala's senior unsecured US$500 million notes due June 2027 with a coupon of 4.375%. Guatemala will use the proceeds to pay capital and interest of existing debt and the remainder to finance social and capital expenditures. The rating on the notes is the same as the long-term foreign currency sovereign credit rating on Guatemala. S&P's ratings on Guatemala reflect its low fiscal deficits, stable debt-to-GDP ratio, and sound monetary policy. The ratings also take into account high political fragmentation, which hampers structural reforms; high poverty levels; and weak government institutions. The negative outlook on the long-term ratings reflects S&P's expectation that Guatemala's government institutions will remain weak, resulting in low public-sector investment and in consistently low general government revenues. This in turn could hurt the country's long-term growth prospects and the possibility to overcome its immense social needs. RATINGS LIST Republic of Guatemala Sovereign Credit Rating Foreign Currency BB/Negative/B Local Currency BB+/Negative/B New Rating Republic of Guatemala Senior Unsecured US$500 mil notes due June 2027 BB =========== M E X I C O =========== BANCO MONEX: S&P Puts 'BB+' Rating on CreditWatch Negative ---------------------------------------------------------- S&P Global Ratings placed its 'BB+' long-term global scale and 'mxA+/mxA-1' national scale ratings on Banco Monex S.A. on CreditWatch with negative implications. S&P also placed the 'mxA+/mxA-1' ratings on Monex Casa de Bolsa S.A. and the 'mxA' issuer credit and issue-level ratings on its ultimate parent company, Monex S.A.B. de C.V., on CreditWatch negative. S&P also affirmed the 'B' short-term global scale on Banco Monex. The CreditWatch negative listing reflects the pressure on the bank's RAC ratio after Monex announcement that it has terminated the participation agreement with Ventura Capital Privado, S.A. de C.V. This agreement would have resulted in a capital injection of MXN1 billion in Banco Monex. S&P incorporated such a capital injection in our last base-case scenario assumptions, resulting in a projected RAC ratio of 10.5% on average for 2017 and 2018. The absence of such capital injection is prompting S&P to reassess Monex's forecasted RAC for the next two years. CONSUBANCO SA: S&P Lowers ICR to 'BB-' & Puts on Watch Neg. ----------------------------------------------------------- S&P Global Ratings lowered its long-term global scale issuer credit rating to 'BB-' from 'BB' and its national scale issuer credit rating to 'mxBBB+' from 'mxA' on Consubanco, S.A. Institucion de Banca Multiple. At the same time, S&P lowered the issue-level ratings on the bank's debt. Also, S&P placed these ratings on CreditWatch negative. S&P also affirmed the short-tern national scale rating at 'mxA-2'. The downgrade reflects S&P's view that, on a peer comparative basis, Consubanco's relative credit standing is no longer in line with its previous global and national scale ratings. S&P believes the bank's liquidity ratios, by its measurement, are underperforming those of its direct peers with similar credit rating, facing an increasing refinancing risk. S&P was previously confident that the bank would be able to issue unsecured debt, as seen in its plans to do so for MXN1.5 billion in September 2016 and then for MXN750 million in March 2017 that were not issued, and finally in May 2017 for MXN500 million out of an initial MXN750 million amount offer, in order address future debt maturities. The CreditWatch listing reflects the increasing refinancing risk for Consubanco in the next 12 months, which could pressures its liquidity, if the bank's funding plan doesn't occur as planned. Such a plan includes looking at secured and unsecured funding alternatives, which if successful would diminish liquidity pressures and improve its debt maturity profile. However, S&P acknowledges such a success is dependent on market sentiment and confidence sensitivity to the bank. Consubanco has MXN2.4 billion in wholesale maturities for the next 12 months. The ratings reflect S&P's view of Consubanco's revenue concentration in payroll discount lending services, as well as the risks inherent in lending to public-sector entities. It also incorporate the bank's lack of a sound deposit, retail-oriented base compared with Mexican banking system. The ratings are also supported by a solid capital base, reflected in S&P's forecasted risk-adjusted capital ratio of 19.8% on average for the next 12 months also supports the ratings. FINCOMUN SERVICIOS: S&P Affirms 'B+/B' Global Scale Rating ---------------------------------------------------------- S&P Global Ratings said that it revised its outlook, for both its long-term global and national scale ratings, on FinComun Servicios Financieros Comunitatios S.A. de C.V. Sociedad Financiera Popular (FinComun) to negative from stable. At the same time, S&P affirmed the 'B+/B' global scale rating. S&P also lowered the national scale long-term rating to 'mxBBB-' from 'mxBBB' and affirmed the short-term national scale at 'mxA-3' on the lender. The rating action reflects the pressures on FinComun's asset quality. The latter has weakened its business position due to increased risk appetite, which in S&P's view, is more aggressive than the industry average, as seen in the significant growth on a non-core business product (payroll loans to government employees) that's hurting asset quality. As a result, FinComun entered into a correction plan with Mexico's regulator that in addition to a MXN92 million capital injection contemplates other initiatives that will keep strengthening the capital base. Therefore, S&P's projected risk-adjusted capital (RAC) ratio will strengthen to 8.5%-9.0% in 2017 and 2018, which makes S&P's assessment on its capital and earnings stronger than in the past. The issuer credit ratings also reflect FinComun's weaker-than- average asset quality metrics, which limit its risk position. The ratings also incorporate S&P's assessment of its funding as below average, given the lack of access to the central bank window, and its liquidity as adequate. The stand-alone credit profile (SACP) remains at 'b+'. The long-term global scale credit rating on Fincomun is the same as its SACP because the latter doesn't factor external support either from the government or parent. The downgrade on FinComun's long-term national scale rating is based on a comparative analysis with local peers. S&P believes the already seen asset quality deterioration, in addition to the challenges the company will face over the next 12 months, is no longer commensurate with other Mexican issuers that are rated in the 'mxBBB' rating level, thus, the creditworthiness on a national scale basis has deteriorated. The negative outlook on FinComun for the next 12 months reflects that there is more than a 33% probability of a downgrade as result of a weakening of its risk position. This is because if the correction plan fails, and the sum of NPA and NCOs consistently represents more than 20% of the total portfolio, with loan loss reserves not fully covering NPLs, S&P would reassess FinComun's risk position to a weaker category. S&P could revise the outlook to stable in the next 12 months if the lender complies with its correction plan, resulting in the sum of NPAs and NCOs representing less than 20% of its total loan portfolio and reserves fully cover the NPAs in a consistent manner. These factors would relieve pressure on the risk position while keeping the RAC ratio consistently above 7%. GRUPO FAMSA: S&P Affirms B Global Scale CCR, Outlook Negative ------------------------------------------------------------- S&P Global Ratings revised its outlook on the corporate credit rating on Grupo Famsa, S.A.B. de C.V. (GFamsa) to negative from stable. "At the same time, we affirmed our 'B' global scale and 'mxBBB-' national scale corporate credit ratings. We also affirmed our 'B' and 'mxBBB-' issue-level ratings on GFamsa's debt. Our recovery rating of '3', which indicates our expectation of meaningful (50%-90%; rounded estimate 50%) recovery prospects for the bondholders in the event of a payment default, remains unchanged," said S&P. During the first quarter of 2017, GFamsa received proceeds related to an asset monetization plan, as part of the execution of a guarantee granted by the company's controlling shareholder. As of May 30, 2017, GFamsa has received from this series of transactions more than MXN700 million, which the company used to amortize short-term maturities. The company also expects to receive an additional MXN1.7 billion throughout the rest of the year and another MXN900 million during 2018 to further reduce debt. In S&P's opinion, these initiatives signal the shareholders' commitment to improve GFamsa's capital structure and ensure that it meets all financial obligations in a timely manner. Nevertheless, these efforts have not sufficiently improved GFamsa's financial performance, and its key credit metrics still underperform S&P's expectations for the rating level. In addition, the company continues to face several challenges in light of sluggish economic conditions in Mexico, a less favorable business environment in the U.S., and fierce competition. Although GFamsa has shown progress in improving its liquidity and capital structure, S&P considers that the company could fall short to revert its deteriorating trend. GFamsa's business position is still constrained by its small size in terms of revenues compared with those of regional peers, holds a small market share in Mexico, and has limited geographic footprint and product differentiation. However, offsetting factors that support GFamsa's rating are its still strong presence in northern Mexico, as well as a healthy performance of its captive finance division, Banco Ahorro Famsa S.A. Institucion de Banca Multiple. Moreover, despite the decline in profitability in the past two years, S&P still expects the company to maintain EBITDA margins above those of other industry players, at 18-19% in the next two years, reflecting the implementation of some cost reductions and layoffs. S&P said, "We have revised our financial risk profile assessment to highly leveraged, because we now expect GFamsa's debt-to-EBITDA ratio to remain above 5.0x and its EBITDA interest coverage ratio below 2.0x in the next 12 months. All of our ratios are adjusted by operating leases, pensions, and captive finance operations. The company has a significant exposure to the dollar-denominated debt, and carries substantial operating leases that pressure leverage metrics. However, the company is analyzing different options to diminish its dollar exposure and we will continue to monitor these strategies." =============== P A R A G U A Y =============== VISION BANCO: S&P Affirms 'B' ICR; Outlook Remains Stable --------------------------------------------------------- S&P Global Ratings Services affirmed its 'B' long-term issuer credit rating on Vision Banco S.A.E.C.A. The outlook remains stable. The rating on Vision reflects S&P's view of its leading market position and strong expertise in the microfinance segment in Paraguay; weak capital and earnings despite recent improvements based on S&P's forecasted RAC ratio 4.5%-4.7% for the next 18-24 months; weaker-than-average asset quality indicators given the bank's exposure to the microfinance and consumer businesses (middle and lower income segments), which are more susceptible to soft economic conditions, although mitigated by a more fragmented and less dollarized loan portfolio compared with those of its peers. S&P also incorporates in its ratings Vision's diversified and stable deposit base thanks to a nationwide branch network and its adequate liquidity, with liquidity metrics in line with those of other rated banks in the country. ================================ T R I N I D A D & T O B A G O ================================ DENNY'S: Forced to Close its Doors ---------------------------------- Trinidad Express reports that strapped for foreign exchange to import food supplies for its menu, the local franchise holder of Denny's in Maraval has been forced to close the restaurant's doors. Denny's, a 24-hour US restaurant chain, was opened in January last year, according to Trinidad Express. Local franchise holder, Grand Slam Restaurants, announced the immediate closure in a statement, the report notes. "Whil[e] we no longer represent the Denny's brand, we are committed to re-opening before the end of June at our Maraval location with a restaurant and sports bar focused on a wide- ranging, great tasting menu, value priced options and exceptional customer service that you, our patrons, have demand," it said, the report notes. ================= X X X X X X X X X ================= * BOND PRICING: For the Week From May 29 to June 2, 2017 -------------------------------------------------------- Issuer Name Cpn Price Maturity Country Curr ----------- --- ----- -------- ------- --- BA-CA Finance Cayman Lt 0.518 62.07 KY EUR CSN Islands XII Corp 7 68 BR USD CSN Islands XII Corp 7 67.75 BR USD Decimo Primer Fideicomi 4.54 52.63 10/25/2041 PA USD Decimo Primer Fideicomi 6 63.5 10/25/2041 PA USD Dolomite Capital Ltd 13.26 67.2 12/20/2019 CN ZAR Empresa de Telecomunica 7 73.14 1/17/2023 CO COP Empresa de Telecomunica 7 73.14 1/17/2023 CO COP ESFG International Ltd 5.75 0.66 KY EUR General Shopping Financ 10 72.5 KY USD General Shopping Financ 10 71.7 KY USD Global A&T Electronics 10 74 2/1/2019 SG USD Global A&T Electronics 10 74.5 2/1/2019 SG USD Global A&T Electronics 10 65.5 2/1/2019 SG USD Global A&T Electronics 10 65 2/1/2019 SG USD Gol Finance 8.75 63 BR USD Gol Finance 8.75 63.88 BR USD Gol Linhas Aereas SA 10.75 34.63 2/12/2023 BR USD Gol Linhas Aereas SA 10.75 34.63 2/12/2023 BR USD Inversora Electrica de 6.5 55 9/26/2017 AR USD Inversora Electrica de 6.5 55 9/26/2017 AR USD MIE Holdings Corp 7.5 75.16 4/25/2019 HK USD MIE Holdings Corp 7.5 75.26 4/25/2019 HK USD NB Finance Ltd/Cayman I 3.88 58.01 2/7/2035 KY EUR Newland International P 9.5 19.88 7/3/2017 PA USD Newland International P 9.5 19.88 7/3/2017 PA USD Noble Holding Internati 5.25 72.98 3/15/2042 KY USD Ocean Rig UDW Inc 7.25 39 4/1/2019 CY USD Ocean Rig UDW Inc 7.25 38 4/1/2019 CY USD Odebrecht Drilling Norb 6.35 48.5 6/30/2021 KY USD Odebrecht Drilling Norb 6.35 47.25 6/30/2021 KY USD Odebrecht Finance Ltd 7.5 49 KY USD Odebrecht Finance Ltd 4.3 48.29 4/25/2025 KY USD Odebrecht Finance Ltd 7.12 48.2 6/26/2042 KY USD Odebrecht Finance Ltd 5.25 46.15 6/27/2029 KY USD Odebrecht Finance Ltd 7 57.02 4/21/2020 KY USD Odebrecht Finance Ltd 5.12 53.51 6/26/2022 KY USD Odebrecht Finance Ltd 8.25 70.88 4/25/2018 KY BRL Odebrecht Finance Ltd 6 51.47 4/5/2023 KY USD Odebrecht Finance Ltd 5.25 45.92 6/27/2029 KY USD Odebrecht Finance Ltd 7.1 47.82 6/26/2042 KY USD Odebrecht Finance Ltd 7.5 49.25 KY USD Odebrecht Finance Ltd 4.3 48.39 4/25/2025 KY USD Odebrecht Finance Ltd 6 51.77 4/5/2023 KY USD Odebrecht Finance Ltd 8.2 70.88 4/25/2018 KY BRL Odebrecht Finance Ltd 7 56.85 4/21/2020 KY USD Odebrecht Finance Ltd 5.1 52.99 6/26/2022 KY USD Odebrecht Offshore Dril 6.6 39.64 10/1/2022 KY USD Odebrecht Offshore Dril 6.7 36.44 10/1/2022 KY USD Odebrecht Offshore Dril 6.6 38.79 10/1/2022 KY USD Odebrecht Offshore Dril 6.7 38.75 10/1/2022 KY USD Petroleos de Venezuela 12.75 67.19 2/17/2022 VE USD Petroleos de Venezuela 9 58.28 11/17/2021 VE USD Petroleos de Venezuela 6 40.32 5/16/2024 VE USD Petroleos de Venezuela 9.75 50.15 5/17/2035 VE USD Petroleos de Venezuela 6 38.22 11/15/2026 VE USD Petroleos de Venezuela 5.37 37.39 4/12/2027 VE USD Petroleos de Venezuela 5.5 37.1 4/12/2037 VE USD Petroleos de Venezuela 6 41.25 10/28/2022 VE USD Petroleos de Venezuela 6 40.01 5/16/2024 VE USD Petroleos de Venezuela 9 58.11 11/17/2021 VE USD Petroleos de Venezuela 6 38.13 11/15/2026 VE USD Petroleos de Venezuela 12.75 67.2 2/17/2022 VE USD Petroleos de Venezuela 9.75 49.94 5/17/2035 VE USD Polarcus Ltd 5.6 60 3/30/2022 AE USD Siem Offshore Inc 5.8 49.75 1/30/2018 NO NOK Siem Offshore Inc 5.59 50.25 3/28/2019 NO NOK STB Finance Cayman Ltd 2.04 58.35 KY JPY Sylph Ltd 2.36 50.93 9/25/2036 KY USD Uruguay Notas del Tesor 5.25 68.02 12/29/2021 UY UYU US Capital Funding IV L 1.25 51.35 12/1/2039 KY USD US Capital Funding IV L 1.25 51.35 12/1/2039 KY USD USJ Acucar e Alcool SA 9.87 67.5 11/9/2019 BR USD USJ Acucar e Alcool SA 9.87 65.75 11/9/2019 BR USD Venezuela Government In 9.25 48.75 5/7/2028 VE USD Venezuela Government In 13.63 82.58 8/15/2018 VE USD Venezuela Government In 9 51.75 5/7/2023 VE USD Venezuela Government In 9.37 49 1/13/2034 VE USD Venezuela Government In 7 71.88 12/1/2018 VE USD Venezuela Government In 9.25 52 9/15/2027 VE USD Venezuela Government In 7.65 46.38 4/21/2025 VE USD Venezuela Government In 13.63 82.58 8/15/2018 VE USD Venezuela Government In 7.75 61.75 10/13/2019 VE USD Venezuela Government In 11.95 58.13 8/5/2031 VE USD Venezuela Government In 6 53.75 12/9/2020 VE USD Venezuela Government In 12.75 67 8/23/2022 VE USD Venezuela Government In 7 44 3/31/2038 VE USD Venezuela Government In 6.5 36.53 12/29/2036 VE USD Venezuela Government In 8.25 47.75 10/13/2024 VE USD Venezuela Government In 11.75 57.75 10/21/2026 VE USD Venezuela Government TI 5.25 69.59 3/21/2019 VE USD *********** 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, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2017. 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 Joseph Cardillo at 856-381-8268. * * * End of Transmission * * *