/raid1/www/Hosts/bankrupt/TCRLA_Public/240227.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
Tuesday, February 27, 2024, Vol. 25, No. 42
Headlines
A R G E N T I N A
ARGENTINA: Multiple Demonstrations to Claim Food Aid
ARGENTINA: Needs 'Consistent' Monetary, Exchange Policy
YPF SA: Fitch Affirms 'CCC-' LongTerm IDRs
B A H A M A S
FTX GROUP: Investors Sue Law Firm Sullivan & Cromwell
FTX GROUP: Sam Bankman-Fried to Stick With New Lawyers
B O L I V I A
BOLIVIA: Unveils Measures to Tackle Sharpening Dollar Crisis
B R A Z I L
ENGIE BRASIL: Fitch Affirms 'BB+' Foreign Currency IDR
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: Abinader Reports 104M in Agricultural Loans
J A M A I C A
JAMAICA: BOJ Makes US$70 Million Forex Intervention Within Days
JAMAICA: Sustained Economic Growth Needed to Boost Prosperity
M E X I C O
CEMEX SAB: S&P Affirms 'BB+' ICR on New M&G Modifier Assessment
P U E R T O R I C O
EYEWEAR SHOP: Unsecureds Owed $10,000+ to Recover 7% in 60 Mos.
- - - - -
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A R G E N T I N A
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ARGENTINA: Multiple Demonstrations to Claim Food Aid
----------------------------------------------------
Buenos Aires Times reports that thousands of people marched across
cities in Argentina to demand extra food aid from Javier Milei's
government for soup kitchens and to reject severe austerity
policies.
Argentina's ongoing economic crisis has already pushed poverty
above 50 percent and inflation is running at more than 250 percent
year-to-year, according to Buenos Aires Times.
In Buenos Aires, the main protest was centred at the doors of the
Human Capital Ministry, in the city centre, which is in charge of
social aid, the report notes.
"Food emergency can wait no longer, no more adjustment" was the
slogan gathering the protest of social organisations and left-wing
parties, the report relays.
The groups are seeking to highlight the challenges facing some
38,000 community soup kitchens, the last resort for people most
battered by the economic crisis, the report discloses.
Since his inauguration as president on December 10, Javier Milei
has introduced large cutbacks, devalued the peso, halves the number
of government ministries amid a severe austerity plan, the report
relays. In January, the approach translated into the first fiscal
surplus after 12 years in the red, the report discloses.
On the other side is growing tension stoked by lay-offs, the loss
of purchasing power, smaller pensions, healthcare and medicine
hikes and soaring food prices, the report relays.
Milei has also moved to slash government subsidies for utilities
and public transport fares, which have risen by almost 250 percent
in just three months, the report notes.
"No to transport increases," "Hunger can't wait," "Pots are empty,
so are pockets," were some of the slogans on banners carried by
demonstrators outside the Human Capital Ministry, the report
relays.
Some soup kitchens reported that they received their last food
shipments in November and that ever since, they have depended on
donations and municipal aid to assist the increasing number of
people visiting them every day, the report notes.
The government says it will reach the most vulnerable citizens
directly and wants to avoid the interference of intermediaries,
most of whom oppose Milei's administration, the report discloses.
The Human Capital Ministry has signed a food aid agreement with
evangelical churches to the tune of nearly US$200,000 and another
for nearly twice as much with Caritas Argentina, which answers to
the Catholic Church, the report relays.
The portfolio announced last month the start of a survey of soup
kitchens that would allow "for the transparent purchase of food,"
the report notes.
Community centres report that in the meantime, all deliveries have
been suspended, the report discloses.
"There should be no reason to stop sending food to soup kitchens,"
insisted Presidential Spokesman Manuel Adorni, rejecting the
claims, the report relays.
The government has maintained the existence of the Tarjeta
Alimentar food card, a direct monthly subsidy for parents of up to
two children, the report says.
In February, that value of the card was 69,000 pesos (US$78.5 at
the official exchange rate), the report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on June 13, 2023, raised its local currency
sovereign credit ratings on Argentina to 'CCC-/C' from 'SD/SD' and
0its national scale rating to 'raCCC+' from 'SD'. S&P also affirmed
its 'CCC-/C' foreign currency sovereign credit ratings on
Argentina. The outlook on the long-term ratings is negative. S&P's
'CCC-' transfer and convertibility assessment is unchanged. None of
its rated bond issues are affected.
S&P said the negative outlook on the long-term ratings is based on
the risks surrounding pronounced economic imbalances and policy
uncertainties before and after the 2023 national elections.
Divisions within the government coalition, and infighting among the
opposition, constrain the sovereign's ability to implement timely
changes in economic policy.
Fitch Ratings also upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
ARGENTINA: Needs 'Consistent' Monetary, Exchange Policy
-------------------------------------------------------
Buenos Aires Times reports that the second-in-command of the
International Monetary Fund, Gita Gopinath, met with President
Javier Milei, before calling on Argentina's government to continue
its programme to "restore macroeconomic stability."
Gopinath, the IMF's deputy managing director, said Argentina needed
a "consistent and well communicated monetary and exchange rate
policy" in order to "further reduce inflation, rebuild reserves and
reinforce credibility," according to Buenos Aires Times.
The economist also said it is "essential" that the government
maintain measures to support vulnerable citizens and preserve the
real value of social assistance and pensions, the report relays.
The meeting with Milei took place on the second day of the IMF
deputy's visit to Buenos Aires, the report discloses.
Gopinath spent some four hours with Economy Minister Luis Caputo,
Central Bank Governor Santiago Bausili and Cabinet Chief Nicolas
Posse, the report relays.
"Over the past few days, I have been able to learn more about the
progress being made, but also the hardships the Argentine people
are now facing. I heard first-hand from a wide range of
stakeholders who shared their ideas on how to address the country's
challenges and harness its vast potential," said the IMF deputy in
a statement, the report discloses.
"In my meetings with President Milei and his economic team, I
recognised the important initial gains in restoring macroeconomic
stability and establishing a strong fiscal anchor. The path ahead
remains challenging, and consistent and well-communicated monetary
and FX policy will be necessary to continue to bring down
inflation, rebuild reserves, and strengthen credibility," she
continued, the report relays.
Talks with Argentine officials focused on Argentina's
US$44.5-billion credit programme with the Fund and assessing the
government's compliance with it ahead of an upcoming quarterly
review, the report notes.
"I had a productive discussion with Caputo, Bausili and Posse on
the efforts underway to restore macroeconomic stability, protect
the vulnerable and strengthen Argentina's growth prospects," the
Fund official posted on X, the report relays.
The three officials outlined the results of January's management of
the economy, government sources said. Argentina recorded a trade
surplus of US$797 million and the government a fiscal surplus of
US$588 million, the Telam state agency reported, Buenos Aires Times
notes.
Gopinath, 52, met with government officials, academics and
representatives of social organisations and trade unions while in
Buenos Aires, the report relays. She also met with the leaders of
the CGT umbrella union grouping, the report relays.
Social tension and unrest is rising as protests grow in response to
the first measures of President Milei's government, Buenos Aires
Times discloses. During the first day of her visit, Argentina's
railway workers walked off the job in protest, paralysing trains
nationwide, the report says. Teachers have called a strike to
coincide with the beginning of the school year and healthcare
workers staged a demonstration, the report relays.
Before leaving for the G20 meeting in Rio de Janeiro, the IMF's
number two spoke with Milei about his plans, which the IMF have
described as "bold" and "challenging," the report relays.
"Excellent and substantive meeting with President Javier Milei on
how best to take the country forward," wrote Gopinath in post on
social media, the report discloses.
In 2018, during former president Mauricio Macri's government,
Argentina borrowed US$57 billion from the IMF, of which it
eventually drew more than US$44 billion, the report relays. The
agreement was renegotiated in 2022 by Peronist leader Alberto
Fernández, and after non-compliance with goals in 2023, has been
re-floated by the Milei government, the report notes.
Milei has moved to carry out a strong fiscal adjustment, higher
than the level even recommended by the IMF itself, the report
discloses. He has vowed to end 2024 with a fiscal surplus of three
percent of GDP, the report says.
Speculation in Argentina is growing that the Milei administration
may seek a new program with the Fund to replace its existing credit
line, the report relays.
When it approved the latest disbursement of funds for Argentina,
the IMF praised Milei's "ambitious stabilization plan" that hopes
to reverse an annual inflation of 254.2 percent, the report
relates. Poverty affects half the population and a 2.8-percent
contraction of GDP for 2024 has been forecast by Fund's
technicians, the report says.
However, the IMF has warned the government that the president's
plan requires "clear communication" and protection for the most
vulnerable, the report relates.
Gopinath arrived on the day national railway workers brought the
network to a halt in a nationwide strike. In the coming days,
healthcare and education unions have also announced strikes to
demand wage increases, the report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on June 13, 2023, raised its local currency
sovereign credit ratings on Argentina to 'CCC-/C' from 'SD/SD' and
0its national scale rating to 'raCCC+' from 'SD'. S&P also affirmed
its 'CCC-/C' foreign currency sovereign credit ratings on
Argentina. The outlook on the long-term ratings is negative. S&P's
'CCC-' transfer and convertibility assessment is unchanged. None of
its rated bond issues are affected.
S&P said the negative outlook on the long-term ratings is based on
the risks surrounding pronounced economic imbalances and policy
uncertainties before and after the 2023 national elections.
Divisions within the government coalition, and infighting among the
opposition, constrain the sovereign's ability to implement timely
changes in economic policy.
Fitch Ratings also upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
YPF SA: Fitch Affirms 'CCC-' LongTerm IDRs
------------------------------------------
Fitch Ratings has affirmed the Long-Term Foreign Currency and Local
Currency Issuer Default Ratings (IDRs) of YPF S.A. at 'CCC-'. Fitch
has also affirmed YPF's outstanding senior unsecured notes at
'CCC-'/'RR4'. Fitch maintains the company's Standalone Credit
Profile (SCP) at 'b'.
YPF's ratings are in line with Fitch's "Government Related Entities
Criteria." The company is majority owned by the government of
Argentina and strategically important to the country. YPF's
dominant market share in the supply of liquid fuels in Argentina,
coupled with its large hydrocarbon production footprint in the
country, could expose the company to government intervention
through pricing policies or investment strategies.
KEY RATING DRIVERS
Links to Sovereign: YPF is closely linked to the Republic of
Argentina due to its ownership structure, as well as recent
government interventions. Argentina controls the company through
its 51% stake, and provincial government officials serve on the
company's board of directors. In addition, the republic sometimes
governs the company's strategy and business decisions. The
Argentine government has a history of significant interference in
the oil and gas sector, particularly in intervening in the
company's ability to implement its pricing policy for refined
products.
The SCP of YPF is in the 'b' category, reflective of the issuer's
production cost profile that is above average compared with peers
in the region, and its inability to diversify its operation outside
of Argentina.
Key Player in a Volatile Operating Environment: YPF is the market
leader in the country with over 60% of market share for refined
products. The company's strong market position and branding give it
the ability to adapt to market changes should the government
succeed with its plan to open the energy market in Argentina. YPF's
dominating participation along the value chain of fuels, combined
with largest acreage under license for production of crude and gas,
support the company's significant potential for value creation in a
more liberalized sector. YPF's robust business model positions the
company to benefit from current efforts to shift Argentina from a
net importer to a net exporter of hydrocarbons in an economy
plagued by a high government debt to GDP ratio, high inflation, and
negative Real GDP growth for both 2023 and 2024.
Stable Production and High Cost Profile: Fitch's rating case
assumes production will average 545,000boed over the rating
horizon. Fitch estimates YPF's 2022 half-cycle costs of USD35.97boe
and full-cycle cost of USD53.33boe, which are both high and
above-average for players in the region, and not expected to
materially change in 2023 and 2024. The company's high cost is
mostly attributed to higher-than-average lifting cost of USD13.3boe
(USD 4.0boe for shale oil production) and high interest cost per
barrel of USD12.52boe in 2022. The company's full-cycle break-even
implied prices were below-weighted-average realization prices for
oil and gas.
Financial Metrics Strengthen: YPF has maintained a moderate
leverage profile. Fitch estimates YPF's total debt/EBITDA will be
1.8x in 2023 compared with 1.9x in 2022 and will decrease to an
average of 1.0x over the rated horizon. YPF's total debt/1P has
materially improved. The company reported 1,187 mmboe in 2022,
translating into total debt to 1P of reserves of USD5.96boed in
2022 and an estimated USD4.73boe for 2023 based on 1P reserves as
reported in 2022. The company's leverage profile has been stable,
but is challenged by a limited pool and high cost of capital given
the macroeconomic environment in Argentina and its intrusive
capital controls.
DERIVATION SUMMARY
YPF's linkage to the sovereign is similar in nature to its Latin
American national oil company peers, namely PEMEX (B+/Stable),
Petrobras (BB/Stable) and Ecopetrol (BB+/Stable), and
government-owned entities ENAP (A-/Stable) and Petroperu
(BB+/Negative). These companies all have strong linkage to their
respective sovereigns given their strategic importance to each
country and the potentially significant negative social and
financial implication a default could have at a national level.
YPF's upstream business closest peers are Pemex, Petrobras and
Ecopetrol. YPF's total 2022 production averaged 503,300boed, and
the reserve life was 6.4 years, most comparable with Ecopetrol with
a production of 710,000boed and a reserve life of 7.8 years in
2022, but less than Petrobras' production of 2.3 million boed and a
reserve life of 12.6 years and Pemex's production at 2.5 million
boed and a reserve life of 8.0 years.
YPF has an adequate capital structure with a gross leverage ratio
defined as total debt/EBITDA of 1.3x in 2022 and total debt/1P of
USD6.0 per boe compared with Ecopetrol at 1.4x and USD11.9 total
debt/1P, Petrobras at 0.4x and USD2.9 per boe and Pemex at 3.9x and
USD14.7 per boe.
Unlike its peers ENAP, Petrobras, Pemex and Petroperu, YPF is not
the sole provider of refined fuels in Argentina. In 2022, the
company had a 56% market share. YPF is an integrated energy
company, similar to Petrobras and Pemex, offering the company more
financial flexibility, while ENAP is predominately a refining
company that sells to marketers. Historically, YPF has operated
autonomously with periodic controls of fuel prices and crude.
Similar to Pemex and Petrobras, YPF has administered an
import-parity pricing policy and other price controls to help tame
inflation. YPF has successfully been able to tighten spread and
recuperate losses realized during a period of pricing freezes.
When compared with downstream-focused entities ENAP and Petroperu,
YPF leverage level in 2022 of 1.3x compares with ENAP at 3.2x and
Petroperu at -40.8x. Petroperu's elevated leverage is explained by
its investment plan to increase capacity by 2021, while ENAP has
maintained a higher leverage profile for an extended period of
time, but the company is highly strategic for the Chilean
government, and thus its rating is aligned as a result.
KEY ASSUMPTIONS
- Average gross production of 546,000boe from 2023-2026;
- Realized oil price of USD62.5/bbl in 2023 and an average of
USD58/bbl thereafter;
- Natural gas prices rise to USD3.65/MMBTU in 2023 and settle at
USD3.75/MMBTU thereafter;
- Average annual capex of roughly USD5.5 billion per year from 2023
to 2025;
- Downstream sales volume follows Real GDP forecasts and YPF is a
net purchaser of crude;
- Effective tax rate of 35%;
- Fitch ARS/USD forecasts for year average and end of period during
2023-2026;
- No dividend payments over the rate horizon;
- Rollover of short-term maturities.
RECOVERY ANALYSIS
KEY RECOVERY RATING ASSUMPTIONS
- The recovery analysis assumes that YPF would be liquidated in
bankruptcy rather than reorganized via going-concern;
- Fitch has assumed a 10% administrative claim.
LIQUIDATION APPROACH
- The liquidation estimate reflects Fitch's view of the value of
balance sheet assets that can be realized in sale or liquidation
processes conducted during a bankruptcy or insolvency proceeding
and distributed to creditors;
- 50% inventory advance rate;
- $10 per barrel reflects the typical valuation of recent
reorganizations in the oil & gas industry;
- YPF has a material joint-venture with international oil companies
that results in a reported book value of USD1.8 billion,
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- The Foreign Currency IDR is linked to Argentina's sovereign
rating, and an upgrade can only occur with an upgrade of
Argentina's sovereign rating.
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Argentina's sovereign rating is 'CC', the lowest level allowed
under Fitch's sovereign criteria; therefore, a downgrade of Foreign
and Local Currency IDRs of YPF would reflect Fitch's belief that a
default of some kind appears probable, or a default or default-like
process has begun for the company itself.
LIQUIDITY AND DEBT STRUCTURE
Liquidity Vulnerable to Capital Controls: YPF reported USD1.5
billion in cash and cash equivalents in 3Q23. The company faces
significant refinancing risk, heightened by the capital controls,
with USD1,130 million in debt maturing in 2024 followed by USD1,757
million in 2025 and USD930 million in 2026. Fitch expects YPF will
continue to roll over short-term bank and trade financing debt over
the rated horizon.
ISSUER PROFILE
YPF, S.A is the largest fully integrated energy company in
Argentina. YPF participates in three segments: Upstream, Downstream
and Gas and Power.
YPF has been controlled by the Argentine government through its
majority stake of 51% since 2012.
ESG CONSIDERATIONS
Fitch has revised YPFs' ESG Relevance Score for GHG Emissions & Air
Quality to '4' from '3' due to the growing importance of the
continued development and execution of the company's
energy-transition strategy. This has a negative impact on the
credit profile, and is relevant to the ratings in conjunction with
other factors.
The company has a Governance Structure score of '4', due to its
nature as a majority government-owned entity and the inherent
governance risk that arises with a dominant state shareholder,
which has a negative impact on the credit profile, and is relevant
to the ratings in conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
YPF S.A. LT IDR CCC- Affirmed CCC-
LC LT IDR CCC- Affirmed CCC-
senior
unsecured LT CCC- Affirmed RR4 CCC-
=============
B A H A M A S
=============
FTX GROUP: Investors Sue Law Firm Sullivan & Cromwell
-----------------------------------------------------
David Thomas at Reuters reports that a group of FTX investors has
filed a proposed class action lawsuit against U.S. law firm
Sullivan & Cromwell, claiming it participated in the defunct
cryptocurrency exchange's multibillion-dollar fraud before further
enriching itself as FTX's bankruptcy counsel.
Sullivan & Cromwell, which did legal work for FTX during the
company's rise, had unique insight into the exchange's "convoluted
organizational structure, abject lack of internal controls, and
dubious business practices," the investors said in a 75-page
lawsuit, opens new tab filed in Miami federal court, according to
Reuters.
Lawyers at Sullivan & Cromwell, a prominent New York-founded firm,
"were eager to craft not only creative, but misleading strategies
that furthered FTX's misconduct," the lawsuit said, the report
notes.
A spokesperson for Sullivan & Cromwell declined to comment. The
firm has previously defended its work relating to FTX, saying it
had a "limited and largely transactional" relationship with the
exchange before the bankruptcy and had never served as primary
outside counsel to any FTX entity, the report relays.
The investors' lawyers at the Moskowitz Law Firm could not
immediately be reached for comment. The same firm is already
waging a separate class action investor lawsuit accusing law firm
Fenwick & West of aiding fraud at the company, the report
discloses. Fenwick denies the allegations.
A federal judge said the lawsuit against Sullivan & Cromwell will
proceed as part of multi-district litigation over the FTX collapse
that is already pending in Miami federal court, the report relays.
FTX filed for bankruptcy in November 2022 in the wake of claims
that the company misused and lost billions of dollars worth of
customers' crypto deposits, the report notes. FTX founder Sam
Bankman-Fried was found guilty a year later of charges that he
defrauded FTX customers by using their funds to prop up his own
risky investments, the report relays.
The new lawsuit partly takes aim at Sullivan & Cromwell's work as
court-approved counsel advising FTX in its bankruptcy, arguing the
firm knew FTX was in financial trouble but "realized it stood to
gain hundreds of millions more from their work in bankruptcy," the
report discloses.
The firm has earned more than $180 million in fees for its FTX
bankruptcy work, equaling about 10% of its 2022 revenue, the
lawsuit said, the report relays.
Some FTX creditors and U.S. lawmakers had unsuccessfully opposed
Sullivan & Cromwell's bid to serve as bankruptcy counsel, arguing
that the firm's ties to FTX and past work for the company created
conflicts of interest, the report relates. FTX's former U.S.
general counsel, Ryne Miller, was a former partner at Sullivan &
Cromwell.
The U.S. Trustee, the Justice Department's bankruptcy watchdog, had
initially opposed Sullivan & Cromwell's appointment until the firm
and FTX provided additional disclosures about Sullivan & Cromwell's
pre-bankruptcy work, the report notes.
The case is Edwin Garrison, et al., v. Sullivan & Cromwell LLP,
U.S. District Court for the Southern District of Florida,
1:24-cv-20630.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
billion in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims
agent, maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
FTX GROUP: Sam Bankman-Fried to Stick With New Lawyers
------------------------------------------------------
Luc Cohen at Reuters reports that Sam Bankman-Fried, the jailed
founder of bankrupt cryptocurrency exchange FTX, appeared in court
for the first time since his November fraud conviction and
confirmed he wanted to stick with new lawyers despite a possible
conflict of interest.
Bankman-Fried, 31, in January hired defense lawyers Marc Mukasey
and Torrey Young to represent him through his March 28 sentencing,
according to Reuters. He could face decades in prison after a
Manhattan federal court jury found the former billionaire guilty of
stealing billions of dollars from FTX customers, the report notes.
At a brief hearing before U.S. District Judge Lewis Kaplan in
Manhattan, Bankman-Fried said he was comfortable hiring Mukasey and
Young even though they also represent the founder of bankrupt
cryptocurrency lender Celsius Networks, Alex Mashinsky, who has
pleaded not guilty to separate fraud charges, the report relays.
Kaplan asked Bankman-Fried, who wore a tan jail shirt and chains
around his ankles, to describe the possible conflict in his own
words, the report discloses.
"At a high level, they also represent Alex Mashinsky," said a
clean-shaven Bankman-Fried, whose curly hair has grown longer since
his monthlong trial last year, the report relays.
Bankman-Fried described Celsius as "a firm that the firms I ran had
business interactions with," the report notes.
Mukasey, a former federal prosecutor in Manhattan and the son of
former U.S. Attorney General Michael Mukasey, was once part of
former President Donald Trump's personal legal team, the report
relays.
He also represented electric- and hydrogen-powered truck maker
Nikola's founder Trevor Milton, who was sentenced last year to four
years after being convicted of fraud for lying to investors about
the company's technology - well below the 11 years prosecutors
suggested, the report notes.
Bankman-Fried told Kaplan he had consulted with lawyers Mark Cohen
and Christian Everdell, who represented him during his trial, about
Mukasey's potential conflict. Bankman-Fried said he also had
discussed it with Alexandra Shapiro, another lawyer who will handle
his eventual appeal, the report says.
Mukasey said Cohen and Everdell will soon request Kaplan's
permission to withdraw from the case, the report discloses.
In a Feb. 6 court filing, prosecutors in Bankman-Fried's case said
his Alameda Research hedge fund used stolen FTX customer funds to
repay money it borrowed from Celsius, the report relays. The
prosecutors said Bankman-Fried and Mashinsky may have different
opinions as to whether Celsius was defrauded and entitled to
restitution, the report notes.
Bankman-Fried, held at Brooklyn's Metropolitan Detention Center
since August 2023, said he has been taking anti-depressant
medication and Adderall, which is used to treat attention deficit
hyperactivity disorder, the report relays. During his trial,
Bankman-Fried's lawyers said in October he needed a higher Adderall
dose than he had been receiving in jail each morning to focus, the
report notes.
Mashinsky, 59, waived his right to a lawyer without any potential
conflicts at a hearing before U.S. District Judge John Koeltl.
Mukasey and Young said at that hearing that they could fairly
represent both Bankman-Fried and Mashinsky, the report says.
Mashinsky is free on bail. His trial on charges of artificially
inflating the value of the company's in-house crypto token and
earning $42 million from selling his holdings is scheduled for Jan.
28, 2025, the report adds.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
billion in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims
agent, maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
=============
B O L I V I A
=============
BOLIVIA: Unveils Measures to Tackle Sharpening Dollar Crisis
------------------------------------------------------------
globalinsolvency.com, citing Reuters, reports that Bolivia's
government set out a package of measures to spur investment and
exports as it seeks to reverse a worsening dollar scarcity that has
left shelves empty and workers unpaid.
The government of President Luis Arce said its plan, agreed with
businesses, would aim to cut red tape for exports, increase
investment in grains production, make diesel imports easier, and
allow bigger trucks on the roads, according to
globalinsolvency.com.
Reserves have plunged from a peak of some $15 billion a decade ago
to under $2 billion now, eroded by sliding production and exports
of natural gas, the mainstay of the Bolivian economy in the last 20
years, the report notes.
Truckers have been striking in political capital La Paz over
delayed pay, while Fitch slashed the country's debt rating deep
into 'junk' territory earlier, citing the slide in reserves levels
that it said threatens economic stability, the report adds.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
Fitch Ratings upgraded on July 26, 2023, Brazil's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'BB', from 'BB-',
with a Stable Outlook. The upgrade reflects better-than-expected
macroeconomic and fiscal performance amid successive shocks in
recent years, proactive policies and reforms that have supported
this, and Fitch's expectation that the new government will work
toward further improvements.
In mid-June 2023, S&P Global Ratings, revised the outlook on its
long-term global scale ratings on Brazil to positive from stable.
S&P affirmed its 'BB-/B' long- and short-term foreign and local
currency sovereign credit ratings on Brazil. S&P also affirmed its
'brAAA' national scale rating, and the outlook remains stable. The
transfer and convertibility assessment remains 'BB+'. The positive
outlook reflects signs of greater certainty about stable fiscal and
monetary policy that could benefit Brazil's still-low GDP growth
prospects. Continued GDP growth plus the emerging framework for
fiscal policy could result in a smaller government debt burden than
expected, which could support monetary flexibility and sustain the
country's net external position.
Moody's credit rating for Brazil was last set at Ba2 in 2018 with
stable outlook. Moody's affirmed the Ba2 issuer ratings and
senior unsecured bond ratings in April 2022.
DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term
Foreign and Local Currency - Issuer Ratings to BB from BB (low).
At the same time, DBRS Morningstar confirmed Brazil's
Short-term Foreign and Local Currency - Issuer Ratings at R-4.
The trend on all ratings is Stable (March 2018).
===========
B R A Z I L
===========
ENGIE BRASIL: Fitch Affirms 'BB+' Foreign Currency IDR
------------------------------------------------------
Fitch Ratings has affirmed Engie Brasil Energia S.A.'s (Engie
Brasil) Foreign Currency (FC) and Local Currency (LC) Long-Term
Issuer Default Ratings (IDRs) at 'BB+' and 'BBB-', respectively.
Fitch has also affirmed Engie Brasil's Long-Term National Scale
Rating and its senior unsecured debenture issuances at 'AAA(bra)'.
The Rating Outlook for corporate ratings is Stable.
Engie Brasil's ratings reflect its prominent market position as the
second largest electric energy generation company in Brazil, with a
sizable and diversified asset base and operational efficiency. The
company's credit profile also benefits from a track record of
robust operating cash flow generation and solid financial profile,
with moderate leverage and strong financial flexibility. Fitch
considers that Engie Brasil is prepared to face its high capex
plan, even considering the challenges of the expected lower prices
for its uncontracted energy in the coming years. Engie Brasil's FC
IDR is constrained by Brazil's country ceiling of 'BB+', while
Brazil's operating environment anchors the LC IDR.
KEY RATING DRIVERS
Robust Business Profile: Engie Brasil's ratings benefit from a
strong business position in the electric power generation segment
in Brazil. It is the second largest energy generation company in
the country, with a total installed capacity of 8.2GW, to be
expanded to 10.8GW with the conclusion of Atlas Renovaveis'
acquisition (+545MW) and new projects (+2.0GW until the end of
2025). The company presents a successful track record in its
commercial strategy and monthly allocation of its assured capacity,
also benefiting from the dilution of operational risks through its
diversified asset base.
The transmission segment also provides further diversification and
improves predictability to operating cash flow. Engie Brasil has
2,709 km of transmission lines in operational phase and 1,006 km
under development, to be concluded until 2028. Permitted annual
revenues (RAPs) of BRL732 million in this segment should represent
about 10% of the consolidated EBITDA in 2024.
Aggressive Capex Pressures FCF: High investments of BRL14.1 billion
during 2024-2026 period, considered at Fitch's base case, mainly
concentrated in 2024, combined with strong dividends distribution,
will pressure FCF. The ratings base case estimates EBITDA and cash
flow from operations (CFFO) of BRL6.3 billion and BRL4.4 billion in
2024 and BRL6.6 billion and BRL4.0 billion in 2025, respectively,
with negative FCFs of BRL4.1 billion in 2024 and BRL1.7 billion in
2025.
Fitch expects the EBITDA margin to increase over the next few
years, reaching 62% in 2024, due to the full operation of the
transmission lines and the reduction in energy purchase expenses.
The base case scenario anticipates sales of 4.8GW average in 2024
and 4.5GW in 2025, with average tariffs of BRL234/MWh and
BRL233/MWh, respectively.
Leverage Expected to Peak in 2025: Fitch estimates that Engie
Brasil's net leverage ratio will reach 3.3x in 2025, after 2.4x
expected for 2023. These ratios are still consistent for the
current LC IDR. The cash inflow of BRL3.1 billion from the sale of
15% of Transportadora Associada de Gás S.A. (TAG) received in
January 2024 will partially offset the negative impact of BRL3.2
billion from the acquisition of Atlas Renovaveis (disbursement of
BRL2.3 billion for the equity and consolidation of Atlas
Renovaveis's net debt of about BRL1.0 billion). Reduction in
dividends received from TAG to around BRL107 million in 2025 from
BRL490 million in 2024 will be negative to leverage ratios from
this year on. Net debt-to-EBITDA ratio should start to migrate to
levels close to 3.0x from 2026 on.
Additional debt of BRL4.1 billion should finance the negative FCF,
associated to investments in greenfield projects. The company has a
positive track record on capital structure management, which
included reducing dividends distribution in the past.
Manageable Exposure to Hydrologic Risk: Fitch estimates that Engie
Brasil's uncontracted energy volumes of 6% in 2024, 5% in 2025 and
11% in 2026 will be sufficient to support the expected generating
scaling factor (GSF) of 0.87, 0.89 and 0.91 in the same years,
respectively. If needed, Engie Brasil has to obtain energy purchase
contracts at prices compatible with those established in the sales
contracts to cover the reduction in its own generation to avoid
higher negative impacts on cash generation. The current modest
price trend for new contracts currently mitigates this risk. The
company also has protection against hydrological risk in sales
contracts in the regulated market, which represents around 35% of
the energy sold, which limits its assured energy exposure to GSF to
31% of the total.
Exposure to Repricing and Concession Risk in Mid Term: Engie
Brasil's uncontracted position above 46% from 2027 on represents a
pricing risk in the medium term. The base case scenario for the
ratings incorporates average prices of BRL142/MWh for new contracts
during 2024 to 2027, significantly below of that of BRL244/MWh of
the current contracts. In addition, important concessions, which
totals 3.9GW and represents 48% of the company current installed
capacity, expire during 2030-2032. Fitch considers that the group
still has time to manage these exposures and expects potential
impacts in the cash flow, capital structure or liquidity position
to be addressed in advance.
Weak Parent Company Linkage: Engie Brasil's ratings are based on
its standalone credit profile, as overall legal, operational and
strategic incentives to its parent company Engie S.A. (Engie, IDR
A-/Stable) to support Engie Brasil, if needed, are weak. Engie
controls 68.71% of Engie Brasil, but there are no guarantees or
cross-default clauses. Strategic incentives of support are low as
Engie Brasil represents less than 10% of the group's EBITDA despite
being the largest market out of Europe and having some growth
potential. Fitch views operational incentives are low to medium,
due to reputation risks related to the use of a common name.
DERIVATION SUMMARY
Engie Brasil's FC IDR (BB+/Stable) is one to two notches below
peers in Latin America, such as Engie Chile (BBB/Stable), the
fourth largest generator in Chile, Enel Colombia (BBB/Stable), the
second largest generation company in Colombia, and AES Andes
(BBB-/Stable), the second largest generator in Chile and one of the
leaders in Colombia. This is primarily as a result of the Brazilian
Country Ceiling of 'BB+'. Engie Chile, Enel Colombia and AES Andes
benefit from a better economic environment in Chile and Colombia,
which are rated higher than Brasil. Engie Brasil's FC IDR is capped
by the Brazilian Country Ceiling.
Engie Brasil's LC IDR (BBB-/Stable) is more comparable with these
'BBB' category rated peers. It is well positioned relative to other
Latin American power generators in installed capacity, asset
diversification and contracted position. Engie Brasil has an
installed capacity of approximately 8.2GW, which compares favorably
with AES Andes (5.2GW), Enel Generacion Chile (6.0GW) and Enel
Colombia (3.6GW).
The energy mix of Engie Chile and AES Andes differs from the
related company in Brazil and Enel Colombia. Engie Brasil and Enel
Colombia are more exposed to hydrological conditions, while AES
Andes and Engie Chile need to deal with the coal and natural gas
prices volatility. All the companies have predictable and robust
cash flow generation since they have managed business risks
properly, but Engie Brasil has a stronger financial profile.
Compared to European integrated groups with operations in Brazil,
Engie Brasil's FC and LC IDRs are also two to three notches below
of Enel S.p.A. (BBB+/Stable) and Iberdrola (BBB+/Stable). The two
European groups benefit from an international footprint with large
presence in higher-rated geographies (the UK and the U.S., in the
case of Iberdrola, and Italy, for Enel S.p.A.). Both are fully
integrated utilities that benefit from diversified profiles by
business line and geography, with a significant portion of
regulated networks and quasi-regulated renewable generation. In
energy generation, both companies present much higher scale compare
to Engie Brasil - installed capacity of 53GW for Iberdrola and 83GW
for Enel S.p.A.
KEY ASSUMPTIONS
- Energy sales of 4.4 average GW in 2024 and 4.1 average GW in
2025, not including quotas capacity;
- Average sales price of BRL234/MWh in 2024 and BRL233/MWh in
2025;
- Energy purchase of 1.1 average GW in 2024 and 0.7 average GW in
2025;
- SG&A expenses adjusted by inflation;
- Average GSF of 0.87 in 2024 and 0.89 in 2025;
- Capex of BRL14.1 billion from 2024 to 2026;
- Acquisition of HPP Jirau not considered until 2027.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Positive rating action for the company's FC IDR would be
associated with an upgrade of Brazil's sovereign rating;
- Positive rating action for the company's LC IDR would be
associated with improvements in Brazil's operating environment;
- Upgrades are not applicable to the National Scale Rating as it is
at the highest level.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Negative rating action for the LC IDR would be associated with a
deterioration in Engie Brasil's consolidated financial profile,
with net adjusted leverage above 3.5x and/or funds from operations
net leverage above 4.0x, both on a sustainable basis;
- A downgrade on Brazil's sovereign rating would result in a
similar rating action on Engie Brasil's FC IDR;
- A weaker operating environment in Brazil could result in a
downgrade of the LC IDR;
- A two-notch downgrade of Engie Brasil's LC IDR may lead to a
downgrade of the National Scale Rating.
LIQUIDITY AND DEBT STRUCTURE
High Financial Flexibility: Engie Brasil has ample access to
funding sources and a strong liquidity profile, with robust cash
position and no short-term debt concentration. As of September
2023, cash and marketable securities of BRL3.1 billion - net of
restricted cash of BRL311 million - were strong enough to cover the
short-term debt of BRL2.4 billion. The high cash balance,
reinforced by capex financing, will be partially used to fund the
negative FCF in 2024 and 2025. During this two-year period, the
wind complex Serra do Assuruá and the solar complex Assu Sol will
require capex of BRL4.6 billion and BRL2.7 billion, respectively,
mostly supported by long-term project finance debt at the holding
Engie Brasil level. The BRL2.5 billion raised in December 2023 with
the company's 11th debenture issuance, due in five to 15 years,
will be mainly used for capex. As of September 2023, Engie Brasil's
total debt of BRL19.1 billion was mainly comprised of BNDES
(BRL10.0 billion) and debentures (BRL5.4 billion).
ISSUER PROFILE
Engie Brasil is the second largest energy generator in Brazil, with
a total operational installed capacity of 8.2GW and 2.1GW under
development. The company also has 2,709 km of transmission lines in
operation and 1,006 km in the pre-operational phase.
SUMMARY OF FINANCIAL ADJUSTMENTS
Net revenues and EBITDA net of construction revenues and cost.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
Engie Brasil
Energia S.A. LT IDR BB+ Affirmed BB+
LC LT IDR BBB- Affirmed BBB-
Natl LT AAA(bra)Affirmed AAA(bra)
senior
unsecured Natl LT AAA(bra)Affirmed AAA(bra)
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: Abinader Reports 104M in Agricultural Loans
---------------------------------------------------------------
Dominican Today reports that President Luis Abinader announced that
over the past three and a half years of his administration, loans
exceeding 104,000 million pesos have been formalized through the
Agricultural Bank. Approximately 17,000 farmers have benefited
from the financing provided by the bank, according to President
Abinader.
"In the period leading up to 2023, the Agricultural Bank has
successfully formalized loans totaling 104.477 million pesos,"
explained President Abinader, Dominican Today discloses. He
further highlighted an 81 percent growth in the global loan
portfolio of the Agricultural Bank, which encompasses nearly 20
million pesos in credits provided by the central government at
various stages, he added.
Minister of Agriculture Limbert Cruz shared details about an
initiative to combat the potential presence of the Mediterranean
fly. To address this issue, the institution is implementing a plan
to exterminate the insect, according to Dominican Today. Cruz
stated, "We have received three million sterile males, and we plan
to release, depending on weather conditions," the report notes.
These announcements were made by the President during a discussion
on food security in LA Semanal con la Prensa, the report adds.
About Dominican Republic
The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district. Luis Rodolfo
Abinader Corona is the current president of the nation.
TCR-LA reported in April 2019 that Juan Del Rosario of the UASD
Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."
An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.
On December 4, 2023, the TCR-LA reported that Fitch Ratings has
affirmed Dominican Republic's Long-Term Foreign-Currency Issuer
Default Rating (IDR) at 'BB-' and revised the Outlook to Positive
from Stable. Fitch says the Positive Outlook reflects a trend
improvement in governance, and robust growth prospects that should
lead to continued gains in per capita income. According to Fitch,
growth has decelerated in 2023, but it expects Dominican Republic
to recover to high levels during 2024-2025. External liquidity
metrics have improved in recent years, and foreign currency share
of government debt is on a downward path.
In August 2023, Moody's Investors Service changed the outlook on
the Government of Dominican Republic's ratings to positive from
stable and affirmed the local and foreign-currency long-term issuer
and senior unsecured ratings at Ba3. Moody's said the key drivers
for the outlook change to positive are: (i) sustained high growth
rates have enhanced the scale and wealth levels of the economy; and
(ii) a material decline in the government debt burden coupled with
improved fiscal policy effectiveness will support medium-term debt
sustainability.
The affirmation of the Ba3 ratings balances the Dominican
Republic's strong economic growth dynamics and relatively contained
susceptibility to event risks, with a comparatively weaker fiscal
position, reflecting long-standing credit challenges which include:
(i) a shallow revenue base compared to peers, (ii) weak debt
affordability metrics, and (iii) high exposure to foreign currency
borrowing.
S&P Global Ratings, in December 2022, raised its long-term foreign
and local currency sovereign credit ratings on the Dominican
Republic to 'BB' from 'BB-'. The outlook on the long-term ratings
is stable. S&P affirmed its 'B' short-term sovereign credit
ratings. S&P also revised its transfer and convertibility (T&C)
assessment to 'BBB-' from 'BB+'. The stable outlook reflects S&P's
expectation of continued favorable GDP growth and policy continuity
over the next 12-18 months that will likely stabilize the
government's debt burden.
In February 2023, S&P said its BB ratings reflect the country's
fast-growing and resilient economy. It also incorporates the
country's historical political and social challenges in passing
structural reforms to contain fiscal deficits, despite recent
improvements in the electricity sector. The ratings are constrained
by relatively high debt, a hefty interest burden, and limited
monetary policy flexibility.
=============
J A M A I C A
=============
JAMAICA: BOJ Makes US$70 Million Forex Intervention Within Days
---------------------------------------------------------------
RJR News reports that despite US$30 million intervention, the
Jamaican dollar lost $0.03 against the US dollar.
This brings to US$70 million the central bank's intervention,
according to RJR News.
Five banks and five cambios were successful in their bids, the
report notes.
NCB Jamaica, First Global Bank and JMMB Bank Jamaica received the
largest shares of the sum, the report relays.
Trading resumes with banks and cambios selling the US dollar for an
average $157.19, the report says.
The Canadian dollar is being sold for $115.98, the report relays.
The Pound is going for $197.04, while the Euro is selling for an
average $169.85, the report adds.
About Jamaica
Jamaica is an island country situated in the Caribbean Sea.
Jamaica is an upper-middle income country with an economy heavily
dependent on tourism. Other major sectors of the Jamaican economy
include agriculture, mining, manufacturing, petroleum refining,
financial and insurance services.
In October 2023, Moody's upgraded the Government of Jamaica's
long-term issuer and senior unsecured ratings to B1 from B2, and
senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has
been changed to positive from stable. The upgrade of Jamaica's
rating to B1 reflects the government's sustained commitment to
fiscal consolidation and debt reduction. The positive outlook
reflects Moody's assessment that a continuation of the favorable
fiscal trajectory will further increase Jamaica's credit
resilience.
S&P Global Ratings raised on September 13, 2023, its long-term
foreign and local currency sovereign credit ratings on Jamaica to
'BB-' from 'B+', and affirmed its short-term foreign and local
currency sovereign credit ratings at 'B'. The stable outlook
reflects S&P's expectation that the government will remain
committed to prudent fiscal policies and reducing debt, as well as
supportive economic policies including a flexible exchange rate
regime and effective monetary policy.
In March 2022, Fitch Ratings affirmed Jamaica's Long-Term Foreign
Currency Issuer Default Rating (IDR) at 'B+'. The Rating Outlook is
Stable.
JAMAICA: Sustained Economic Growth Needed to Boost Prosperity
-------------------------------------------------------------
RJR News reports that the Caribbean Development Bank says higher
and sustained levels of economic growth are needed to achieve
greater prosperity for the region.
Director of Economics at the CDB, Ian Durant, says the Caribbean
needs to increase export competitiveness and raise productivity,
according to RJR News.
He suggested several requisites for achieving this, including
having adequate climate resilient social and economic
infrastructure and improving the institutional frameworks within
which businesses operate, especially through digitization, the
report notes.
In additition, Mr. Durant proposed the adoption of artificial
intelligence, reducing skills gaps and creating an environment for
strengthened energy security to reduce costs, the report says.
He also said Caribbean countries should try to enhance logistics
quality to augment inter-regional trade, which can develop regional
value chains while reducing import dependence and boost food
security, the report adds.
About Jamaica
Jamaica is an island country situated in the Caribbean Sea.
Jamaica is an upper-middle income country with an economy heavily
dependent on tourism. Other major sectors of the Jamaican economy
include agriculture, mining, manufacturing, petroleum refining,
financial and insurance services.
In October 2023, Moody's upgraded the Government of Jamaica's
long-term issuer and senior unsecured ratings to B1 from B2, and
senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has
been changed to positive from stable. The upgrade of Jamaica's
rating to B1 reflects the government's sustained commitment to
fiscal consolidation and debt reduction. The positive outlook
reflects Moody's assessment that a continuation of the favorable
fiscal trajectory will further increase Jamaica's credit
resilience.
S&P Global Ratings raised on September 13, 2023, its long-term
foreign and local currency sovereign credit ratings on Jamaica to
'BB-' from 'B+', and affirmed its short-term foreign and local
currency sovereign credit ratings at 'B'. The stable outlook
reflects S&P's expectation that the government will remain
committed to prudent fiscal policies and reducing debt, as well as
supportive economic policies including a flexible exchange rate
regime and effective monetary policy.
In March 2022, Fitch Ratings affirmed Jamaica's Long-Term Foreign
Currency Issuer Default Rating (IDR) at 'B+'. The Rating Outlook is
Stable.
===========
M E X I C O
===========
CEMEX SAB: S&P Affirms 'BB+' ICR on New M&G Modifier Assessment
---------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' global and 'mxAA/mxA-1+'
national scale issuer credit ratings on Cemex S.A.B. de C.V.,
following the assignment of the new M&G assessment. At the same
time, S&P affirmed its 'BB+' global scale issuer credit ratings to
Cemex's rated subsidiaries. Outlook remains positive on both
scales.
S&P Global Ratings assigned a new M&G modifier assessment of
positive to Cemex. S&P said, "The action follows the revision to
our criteria for evaluating the credit risks presented by an
entity's management and governance framework. The terms management
and governance encompass the broad range of oversight and direction
conducted by an entity's owners, board representatives, and
executive managers. These activities and practices can impact an
entity's creditworthiness and, as such, the M&G modifier is an
important component of our analysis."
=====================
P U E R T O R I C O
=====================
EYEWEAR SHOP: Unsecureds Owed $10,000+ to Recover 7% in 60 Mos.
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Eyewear Shop LLC filed with the U.S. Bankruptcy Court for the
District of Puerto Rico a Disclosure Statement and Plan of
Reorganization dated February 15, 2024.
The Debtor operates an optical and lens store in San Juan, Puerto
Rico. Before filing for bankruptcy, the Debtor managed its own
professional and personal financial affairs.
The Debtor has executed significant measures and adjustments to
reorganize its financial affairs, that include the reduction of
its
staff, restructure of services and adaptation of inventory to the
specific demands of its customers and the imminent transfer of
operations to a substantially less expensive commercial space.
This Plan proposes to pay creditors of the Debtor with funds from
the cash flow from its future income of its optical and lens store
small business that operates in San Juan, Puerto Rico.
This Plan provides for secured claims classified in Class 1;
general unsecured ($10,000 or less) classified in Class 2; general
unsecured ($10,001 or more) classified in Class 3; insider and
equity security holders classified in Class 4. This Plan also
provides for the payment of administrative expenses, unsecured
priority claims and executory lease contracts, which are
unclassified classes.
Class 2 consists of General unsecured claims in the amount $10,000
or less (convenience class). One-time cash dividend of $1,000,
payable at effective date on a pro-rata basis over the amount of
allowed claims in this class. Currently, the cash dividend
represents 5.55% of the allowed claims within this class.
Class 3 consists of General unsecured in the amount of $10,001 or
more. Monthly cash dividend of $250, beginning on the effective
date of the plan, during a period of 60 consecutive months,
distributed on a pro-rata basis over the amount of allowed claims
in this class. The sum of these 60 monthly payments is $15,000 and
currently represents 7.67% of the allowed claims within this
class.
Class 4 consists of Equity Interest Holders. There will be no
distribution to this class.
Payments and distributions under the Plan will be funded by the
cash flow from future income of the Debtor.
A full-text copy of the Disclosure Statement dated February 15,
2024 is available at https://urlcurt.com/u?l=S9beRx from
PacerMonitor.com at no charge.
Attorney for the Debtor:
Carlos A. Ruiz Rodriguez, Esq.
Licenciado Carlos Alberto Ruiz, LLC
P.O. Box 1298
Caguas, PR 00726
Telephone: (787) 286-9775
Email: carlosalbertoruizquiebras@gmail.com
About Eyewear Shop
Eyewear Shop, LLC, operates an optical and lens store in San Juan,
Puerto Rico.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D.P.R. Case No. 23-01967) on June 28,
2023,
with as much as $1 million in both assets and liabilities.
The Debtor tapped Carlos A. Ruiz Rodriguez, Esq., at Licenciado
Carlos Alberto Ruiz, LLC as bankruptcy counsel and Albert Tamarez
Vasquez, CPA, at Tamarez CPA, LLC as accountant.
*********
S U B S C R I P T I O N I N F O R M A T I O N
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