/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/110325.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Friday, March 25, 2011, Vol. 12, No. 60 Headlines A R G E N T I N A ARIEL GUSTAVO: Creditors' Proofs of Debt Due May 24 CENTRAL TERMICA: Moody's Downgrades Ratings to 'B3/A3' DAROX METALURGICA: Creditors' Proofs of Debt Due May 3 FINEHIDE SA: Creditors' Proofs of Debt Due May 5 GRUPO VCL: Creditors' Proofs of Debt Due May 11 PATIO DE JUEGOS: Creditors' Proofs of Debt Due April 25 B E R M U D A AP STRATEGIC: Creditors' Proofs of Debt Due April 1 AP STRATEGIC: Member to Receive Wind-Up Report on April 22 AP STRATEGIC: Creditors' Proofs of Debt Due April 1 AP STRATEGIC: Member to Receive Wind-Up Report on April 22 B R A Z I L GENERAL MOTORS: Files Second Amended Joint Chapter Plan GENERAL MOTORS: Has Settlement with EPA on Unsecured Claim GERDAU SA: Moody's Reviews 'Ba1' Corporate Family Rating TAVEX MODAL: Moody's Puts Low-B Ratings on Sr. & Mezzanine Shares C A Y M A N I S L A N D S ABN AMRO: Shareholders' Final Meeting Set for April 8 CADOGAN ALTERNATIVE: Shareholders' Final Meeting Set for April 8 CYNRIC INVESTMENTS: Shareholders' Final Meeting Set for April 21 DAGONET INVESTMENTS: Shareholders' Final Meeting Set for April 21 GAWAIN INVESTMENTS: Shareholders' Final Meeting Set for April 21 HERITAGE REAL: Shareholders' Final Meeting Set for April 18 INTERKRAFT MAC 34: Members' Final Meeting Set for April 18 JOLS INVESTMENTS: Shareholders' Final Meeting Set for April 21 PAKPOLEE RETAIL: Shareholder to Receive Wind-Up Report on April 6 PINEBRIDGE RP: Shareholders' Final Meeting Set for April 15 RIVERSIDE FUNDING: Shareholders' Final Meeting Set for April 15 SANTOSHI CLO 2009: Shareholders' Final Meeting Set for April 15 WHITEBOX DIVERSIFIED: Shareholders' Final Meeting Set for April 19 YONTOSHI CLO2: Shareholders' Final Meeting Set for April 15 YU SHAN: Shareholders' Final Meeting Set for April 15 D O M I N I C A N R E P U B L I C RAHAXI INC: Pendle Properties Owns 100MM Shares of Common Stock J A M A I C A NATIONAL COMMERCIAL: Fitch Upgrades Individual Rating to 'D' M E X I C O CORPORACION GEO: Fitch Upgrades Issuer Default Rating to 'BB-' P U E R T O R I C O DJSP ENTERPRISES: Securities Delisted From NASDAQ Stock Market V E N E Z U E L A BANCO EXTERIOR: Fitch Affirms 'B+' Issuer Default Ratings MERCANTIL CA: Fitch Affirms 'B+' Issuer Default Ratings - - - - - ================= A R G E N T I N A ================= ARIEL GUSTAVO: Creditors' Proofs of Debt Due May 24 --------------------------------------------------- Jose Maria Colace, the court-appointed trustee for Ariel Gustavo Castro - Elena Papadimitropoulos Sociedad de Hecho's reorganization proceedings, will be verifying creditors' proofs of claim until May 24, 2011. Mr. Colace will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 4 in Buenos Aires, with the assistance of Clerk No. 7, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. Creditors will vote to ratify the completed settlement plan during the assembly on March 6, 2012. The Trustee can be reached at: Jose Maria Colace Alsina 833 Argentina CENTRAL TERMICA: Moody's Downgrades Ratings to 'B3/A3' ------------------------------------------------------ Moody's Latin America has downgraded Central Termica Loma de la Lata's ratings to B3/A3.ar. The rating outlook continues to be negative. Ratings Rationale The main driver prompting the downgrade is the relatively higher risk perceived from the long term contract executed directly with Compa¤ia Administradora del Mercado Mayorista Electrico S.A. rather than under the Energia Plus framework as originally expected. Furthermore, the contract has been recently amended to allow a higher proportion of contracted capacity with Cammesa, further reducing the likelihood of the development of contracts with a diversified base of private companies within the Energia Plus framework. While the recently announced postponement of the initiation of commercial operations prevents a definitive estimation of the company's future contractual position, the likely increase in the proportion of revenues coming from Cammesa increases, in turn, exposure of CTLLL's future revenues to Argentine government credit risk. Cammesa, the wholesale electricity market administrator in Argentina, continues to face ongoing deficits and in order to make payments it depends on periodic transfers from the national government. As a result, repayment of the notes is therefore exposed to Argentine government (B3/Stable) credit risk. Nevertheless, the ratings continue to be supported by the project's inherent strengths. Closing the cycle of the power plant to a combined cycle configuration will increase its efficiency with no additional gas needs. Furthermore, the project expansion is supported by expectations of continued growth in power demand in the country. Finally, Moody's takes comfort from the fact that Pampa (unrated), the ultimate parent company, guarantees the US$178 million notes due 2015 during the construction period, mitigating to a large degree the risks of potential additional delays in project completion. Moody's National Scale Ratings are intended as relative measures of creditworthiness among debt issues and issuers within a country, enabling market participants to better differentiate relative risks. NSRs differ from Moody's global scale ratings in that they are not globally comparable with the full universe of Moody's rated entities, but only with NSRs for other rated debt issues and issuers within the same country. NSRs are designated by a ".nn" country modifier signifying the relevant country, as in ".ar" for Argentina. For further information on Moody's approach to national scale ratings, please refer to Moody's Rating Implementation Guidance published in August 2010 entitled "Mapping Moody's National Scale Ratings to Global Scale Ratings." The rating outlook is negative due to the still uncertain timeframe for project completion. The expansion was originally expected to be completed by June 2010. However, certain social claims in the area of the plant's location at the beginning of the works in addition to some technical problems recently detected in the steam turbine unit during some recent testing have caused a considerable delay to the beginning of commercial operations which are now not expected to begin until the second half of this year. Although the EPC contractor should provide for the reposition of damaged components with no additional costs for CTLLL, the magnitude of the failure still remains somewhat unclear. The ratings could come under additional downward pressure if the delay in the plant's commercial operations takes substantially longer than the latest estimated completion date since the expected increase in revenues and cash flows from the expansion may not materialize in time vis-a-vis increased cash needs for debt repayment, which will begin on September 2013. Given the recent downgrade, a rating up-grade is not likely in the short term. However, the negative outlook could be stabilized if the project is completed within the recently announced timeframe and once the supply contract with Cammesa is in place. When in operation, the project is expected to generate cash from operations (CFO pre WC) in relation to debt of over 15% with a ratio of CFO pre WCO plus interest to interest of over 2.0 times. Central Termica Loma de la Lata S.A. is an electric generation company formed as a Sociedad Anonima as a result of Pampa Energia S.A. acquisition of the thermal power plant at Loma La Lata in May 2007. CTLLL's main asset is a thermo-electric power plant located in the province of Neuquen-Argentina. Currently, CTLLL has an installed net capacity of 369 MW, which is expected to increase by 178 MW after this conversion project is completed. With a net generation of 448 GWh, total revenues for the fiscal year ending in December 2010 amounted to ARS150 million. Pampa Energia S.A. (not rated) is the largest, fully-integrated electricity company in Argentina. Through its subsidiaries, the company is engaged in the generation, transmission and distribution of electricity within the country. Pampa has an installed capacity of approximately 2,187 MW, which represents about 8% of the country's installed capacity. It also co-controls Transener (not rated), the largest high-voltage electricity transmission system in Argentina and it is the majority shareholder of Edenor (B2, stable), the largest electricity distribution company in Argentina, with more than 2,6 million customers. DAROX METALURGICA: Creditors' Proofs of Debt Due May 3 ------------------------------------------------------ Angel Landro, the court-appointed trustee for Darox Metalurgica SA's bankruptcy proceedings, will be verifying creditors' proofs of claim until May 3, 2011. Ms. Landro will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 8 in Buenos Aires, with the assistance of Clerk No. 15, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. The Trustee can be reached at: Angel Landro Espinosa 1474 Argentina FINEHIDE SA: Creditors' Proofs of Debt Due May 5 ------------------------------------------------ Ricardo Jose Lisio, the court-appointed trustee for Finehide SA's bankruptcy proceedings, will be verifying creditors' proofs of claim until May 5, 2011. Mr. Lisio will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 22 in Buenos Aires, with the assistance of Clerk No. 43, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. The Trustee can be reached at: Ricardo Jose Lisio Habana 4315 Argentina GRUPO VCL: Creditors' Proofs of Debt Due May 11 ----------------------------------------------- Javier Marcelo Espineira, the court-appointed trustee for Grupo VCL SA's bankruptcy proceedings, will be verifying creditors' proofs of claim until May 11, 2011. Mr. Espineira will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 12 in Buenos Aires, with the assistance of Clerk No. 23, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. The Trustee can be reached at: Javier Marcelo Espineira Quirno Costa 125 Argentina PATIO DE JUEGOS: Creditors' Proofs of Debt Due April 25 ------------------------------------------------------- Teresa Norma Fiscina, the court-appointed trustee for Patio de Juegos SA's bankruptcy proceedings, will be verifying creditors' proofs of claim until April 25, 2011. Ms. Fiscina will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 16 in Buenos Aires, with the assistance of Clerk No. 31, will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by the company and its creditors. The Trustee can be reached at: Teresa Norma Fiscina Avenida Manuel Montes de Oca 630 Argentina ============= B E R M U D A ============= AP STRATEGIC: Creditors' Proofs of Debt Due April 1 --------------------------------------------------- The creditors of AP Strategic Series 2 Euro Trading Ltd are required to file their proofs of debt by April 1, 2011, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 16, 2011. The company's liquidator is: Beverly Mathias c/o Argonaut Limited Argonaut House, 5 Park Road Hamilton HM O9 Bermuda AP STRATEGIC: Member to Receive Wind-Up Report on April 22 ---------------------------------------------------------- The member of AP Strategic Series 2 Euro Trading Ltd will receive on April 22, 2011, at 9:30 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced wind-up proceedings on March 16, 2011. The company's liquidator is: Beverly Mathias c/o Argonaut Limited Argonaut House, 5 Park Road Hamilton HM O9 Bermuda AP STRATEGIC: Creditors' Proofs of Debt Due April 1 --------------------------------------------------- The creditors of AP Strategic Series 2 Dollar Trading Ltd are required to file their proofs of debt by April 1, 2011, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 16, 2011. The company's liquidator is: Beverly Mathias c/o Argonaut Limited Argonaut House, 5 Park Road Hamilton HM O9 Bermuda AP STRATEGIC: Member to Receive Wind-Up Report on April 22 ---------------------------------------------------------- The member of AP Strategic Series 2 Dollar Trading Ltd will receive on April 22, 2011, at 9:30 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced wind-up proceedings on March 16, 2011. The company's liquidator is: Beverly Mathias c/o Argonaut Limited Argonaut House, 5 Park Road Hamilton HM O9 Bermuda =========== B R A Z I L =========== GENERAL MOTORS: Files Second Amended Joint Chapter Plan ------------------------------------------------------- Motors Liquidation Company, et al., fka General Motors Corp., et al., have filed with the U.S. Bankruptcy Court for the Southern District of New York their second amended joint Chapter 11 plan. A copy of the Second Amended Plan is available for free at: http://bankrupt.com/misc/GM_secondamendedplan.pdf As reported by the Troubled Company Reporter on Dec. 10, 2010, Judge Robert E. Gerber of the U.S. Bankruptcy Court for the Southern District of New York issued on Dec. 8, 2010, a formal order approving, on a final basis, the Disclosure Statement for the Amended Joint Chapter 11 Plan of Reorganization filed by Motors Liquidation Company and its debtor affiliates. Full-text copies of the Amended Plan and Disclosure Statement, dated December 8, 2010, are available for free at: http://bankrupt.com/misc/gm_Dec8Plan.pdf http://bankrupt.com/misc/gmDec8DS.pdf On March 18, 2011, the Debtors filed a second amendment to the Plan, which changes, among other things, the allowed Eurobond Claims. The Second Amended Plan says that the Eurobond Claims under that certain Fiscal and Paying Agency Agreement, dated as of July 3, 2003, among General Motors Corporation, Deutsche Bank AG London, and Banque Generale du Luxembourg S.A. will be allowed in the amount of $3,770,634,476. The First Amended Plan states that the Eurobond Claims under that certain Fiscal and Paying Agency Agreement, dated as of July 3, 2003, among General Motors Corporation, Deutsche Bank AG London, and Banque Generale du Luxembourg S.A. will be allowed in the amount of $3,772,694,419. The Second Amended Plan says that upon the dissolution of MLC, (i) the Residual wind-down assets will be transferred to the GUC Trust established under the plan in accordance with the GUC Trust agreement executed by the Debtors and Wilmington Trust Company, the GUC Trust Administrator; (ii) the Indenture Trustee/Fiscal and Paying Agent Reserve Cash will be transferred to the GUC Trust, and (iii) all remaining assets of MLC will be transferred to the Avoidance Action Trust at the sole discretion of Wilmington Trust, as the avoidance action trust administrator, and will constitute avoidance action trust assets, and any remaining assets not transferred to the avoidance action trust will be deemed abandoned by the Debtors for all purposes without the necessity for any other or further actions to be taken by or on behalf of the Debtors. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. is 60.8% owned by the U.S. Government. It was formed to acquire the operations of General Motors Corporation through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At Sept. 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, US$971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee has appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. GENERAL MOTORS: Has Settlement with EPA on Unsecured Claim ---------------------------------------------------------- BankruptcyData.com reports that Motors Liquidation Co. filed with the U.S. Bankruptcy Court a motion for an order approving a consent decree and settlement agreement between the United States of America on behalf of the United States Environmental Protection Agency and the Debtors, partially resolving an unsecured claim filed by the U.S. Govt. BData says the claim alleges that the Debtors are liable to the United States for costs in excess of $2 billion relating to liabilities at numerous third-party sites and for violations of certain federal environmental statutes. According to BData, the settlement agreement reached by the parties provides the United States with, among other things, an allowed general unsecured claim in the total amount of $36,290,270 and a disputed general unsecured claim in the face amount of $250 million for all remaining non-settled claims set forth in the claim. If approved, the settlement permits the Debtors to free up reserves of approximately $1.75 billion that were previously reserved on account of the claim, thus increasing the initial distribution to the Debtors' creditors. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers. GM employs 205,000 people in every major region of the world and does business in some 157 countries. GM and its strategic partners produce cars and trucks in 31 countries, and sell and service these vehicles through the following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo, Holden, Jiefang, Opel, Vauxhall and Wuling. GM's largest national market is China, followed by the United States, Brazil, Germany, the United Kingdom, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. is 60.8% owned by the U.S. Government. It was formed to acquire the operations of General Motors Corporation through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The deal was closed on July 10, 2009, and Old GM changed its name to Motors Liquidation Co. Old GM remains subject to a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At Sept. 30, 2010, GM had US$137.238 billion in total assets, US$106.522 billion in total liabilities, US$6.998 billion in preferred stock, US$971 million in non-controlling interest, and US$23.718 billion in total equity. New GM has a 'BB-' corporate credit rating from Standard & Poor's and a 'BB-' issuer default rating from Fitch. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP serve as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long serve as counsel regarding supplier contract matters. FTI Consulting, Inc., serves as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represents the Asbestos Committee. Legal Analysis Systems, Inc., serves as asbestos valuation analyst. GERDAU SA: Moody's Reviews 'Ba1' Corporate Family Rating -------------------------------------------------------- Moody's Investors Service has placed under review for possible upgrade the Ba1 global scale corporate family ratings of Gerdau S.A. and Gerdau Ameristeel Corporation, following the announcement of a primary equity issuance by Gerdau of about BRL3.8 billion to BRL4.2 billion, likely to be concluded during April 2011. Ratings placed under review for possible upgrade are: Issuer: Gerdau S.A. -- Corporate Family Rating: Ba1 (global scale) Issuer: Gerdau Ameristeel Corporation -- Corporate Family Rating: Ba1 -- Probability of Default Rating: Ba1 -- US$23 million senior unsecured notes due 2037: Ba1 / 63-LGD 4 The review process will focus on the use of the proceeds from the equity issuance and its impact on Gerdau's leverage and capital structure as the group executes its large investment program and continues to face margin pressure from growing production costs and, in Brazil, also from lower price premiums due to pressure from imports. The review process is subject to the conclusion of the equity issuance. The review will also consider the efforts by the company to create a more pari passu debt structure across the organization. Gerdau's ratings could be upgraded if Consolidated Net Debt (considering a minimum readily available liquidity cushion of US$1.5 billion) to EBITDA is expected to remain below 3x during the execution of its capex program, with the maintenance of strong liquidity levels. Gerdau's ratings are supported by its historically solid cash generation, which reflects its strong market position in the several markets where it operates, its good operational and geographic diversity, and cost-driven management. While Gerdau's variable cost structure, high integration level and large scale provide good operating flexibility, reducing downside risk and translating into historical robust EBITDA margins through the industry's cycles, structural changes in the Brazilian steel industry leading to increased imports should keep margins under pressure over the near term (but still comparing positively to most international peers). Moody's would expect margins to somewhat recover once ongoing investments in product mix improvement and cost reduction mature within the next couple of years. Gerdau's liquidity position remains healthy based on available cash position and availability under sizeable committed credit facilities, adequate debt maturity profile, and access to export-related and BNDES loans. Gerdau's exposure to the cyclicality of the steel industry, which is subject to global and regional supply-demand imbalances, trade flows and sharp price changes, and product mix that includes a high proportion of long steel, giving the group a relatively high exposure to the construction industry, are constraining factors for its ratings. The Ba1 corporate family rating of Ameristeel at the same level as its parent Gerdau considers the explicit support of the group as evidenced by the guarantees provided by Gerdau and certain Brazilian affiliates for a large portion of Ameristeel's debt and by cross acceleration provisions under the existing loan agreements of Gerdau and its significant subsidiaries, including Ameristeel. Moody's last rating action for Gerdau occurred on December 19, 2008, when Moody's changed the ratings outlook for Gerdau and Ameristeel to stable from positive, and affirmed the Ba1 corporate family ratings of both companies and all related ratings. Gerdau S.A. is the largest long steel producer in the Americas and the second largest globally, and also a leading player in the specialty steel industry worldwide, with total capacity of about 26 million tons per year of crude steel and 22 million tons per year of rolled products. Ameristeel is the second largest long steel producer in North America. In the 2010 Gerdau reported consolidated annual revenues of about US$17.8 billion. The group has operations in 14 countries, including Brazil, USA, Canada, Chile, Peru, Uruguay, Argentina, Mexico, Venezuela, Colombia, Spain, India, Guatemala and the Dominican Republic. TAVEX MODAL: Moody's Puts Low-B Ratings on Sr. & Mezzanine Shares ----------------------------------------------------------------- Moody's America Latina has assigned definitive ratings of Aa3.br (sf) (Brazilian National Scale) and Ba2 (sf) (Global Scale, Local Currency) to the Senior Shares, and Ba2.br (sf) (Brazilian National Scale) and B3 (sf) (Global Scale, Local Currency) to the Mezzanine Shares issued by Tavex Modal Recebiveis Performados II Fundo de Investimento em Direitos Creditorios, a securitized transaction backed by a pool of trade receivables originated by Tavex Brasil S.A. Issuer: Tavex Modal Recebiveis II Fundo de Investimento em Direitos Creditorios * Senior Shares -- rated Aa3.br (sf) (National Scale) & Ba2 (sf) (Global Scale, Local Currency). * Mezzanine Shares -- rated Ba2.br (sf) (National Scale) & B3 (sf) (Global Scale, Local Currency). Rating Rationale The ratings are based on these factors, among others: -- Target and minimum subordination for the Senior Shares of 15% and 12%, respectively, to mitigate losses, dilution and potential interest rate mismatches; -- Target subordination of 5% for the Mezzanine Shares to mitigate losses, dilution and potential interest rate mismatches; -- The strict provisioning methodology to be employed by Banco Modal S.A., the trustee of the transaction, whereby receivables 90 days past due will be 100% provisioned; -- Maximum individual concentration limit of 5% per obligor, where the top ten clients cannot represent more than 25% of the fund's net assets and the remaining balance is distributed in at least 100 separate clients; -- The ability of Banco Bradesco S.A. (A1 Long-term Bank Deposit Rating in the Global Local Currency Scale & Aaa.br in the Brazilian National Scale) to act as master and back-up servicer for the transaction; and -- The legal structure of the transaction, including the bankruptcy remoteness of the issuer. The originator and seller of the trade receivables is Tavex Brasil S.A. (formerly Santista Textil) and is a subsidiary of the Spain- based Tavex Group that resulted from the 2006 merger of Santista Textil (founded in 1929) and Tavex Algodonera (founded in 1846). Approximately 49.7% of Tavex Group's shares (voting / total) are owned by Camargo Correa, a large Brazilian industrial group (not rated by Moody's). The transfer of receivables from the originators to the issuer is structured as a true sale and a definitive assignment of the contracts as set forth in the assignment of transferred credits under the Brazilian civil code. Tavex Modal FIDC II has a tenor of 24 months with an optional 6 month extension period. Extension occurs automatically in the event of senior and/or mezzanine share to remain outstanding at the end of the amortization period in month 24. The senior and subordinated mezzanine shares will accrue interest over the first 12 months of the transaction, and will be amortized in 12 monthly installments from month 13 to month 24. Principal and interest payments during the amortization period will be done pari-passu as long as no early liquidation event has occurred and subordination of senior shares is above 15%. In order to rate the transaction, Moody's has received pool performance data covering the time period April 2007 through March 2010 from Tavex and audited by KPMG. Key data reviewed by Moody's included dilutions, delinquencies, losses, receivable turnover and volume of eligible receivables. Moody's key ratings-model assumptions for this transaction are monthly losses, monthly dilutions, average turnover of receivables and Tavex's credit estimate. Moody's observed a historical average of BRL 130 million for monthly outstanding balance over this period, 2.15% monthly dilutions, 0.61% monthly losses and an average turnover of 109 days. As modeling input assumptions Moody's used a central stressed mean of 4.30% for monthly dilutions and 1.22% for monthly losses over outstanding balance. The main uncertainties of the transaction relate to monthly losses, monthly dilutions, average turnover of receivables and the financial standing of Tavex. Actual experienced monthly losses observed by Moody's via monthly custodian reports are benign and reflect the favorable macro-economic conditions of Brazil. A downturn of the economy coupled with a slowdown of consumer spending would, in Moody's view, lead to heightened loss and dilution figures. Moody's parameter sensitivities provide a quantitative/model- indicated calculation of how the rating of a Moody's-rated structured finance security may vary if certain input parameters used in the initial rating process differed. Qualitative factors are also taken into consideration in the ratings process, so the actual ratings that would be assigned in each case could vary from the information presented in the parameter sensitivity analysis. The results generated by rating models are one of many inputs to the rating process. Ratings are determined collectively through the exercise of judgment by rating committees, which evaluate many quantitative and qualitative factors. For example, if the monthly loss and monthly dilution input parameters used in the initial rating process were both increased by 1% p.m (resulting in a central mean of 5.30% monthly dilutions and 2.22% central mean of monthly losses) the model implied rating for the Senior Shares would be Ba3 (sf) (Global Scale, Local Currency), a one-notch differential from the actual Ba2 (sf) assigned ratings. Similarly, if the monthly loss and monthly dilution input parameters used in the initial rating process were both increased by 2% (resulting in a central mean of 6.30% monthly dilutions and 3.22% central mean of monthly losses), the resulting model implied rating on the Senior Share would be B1 (sf), representing a two-notch rating differential from actual Ba2 (sf) assigned ratings. The rating on the Mezzanine Shares of B3 (sf) would remain stable in these scenarios. Moody's notes that actual performance statistics of the transaction are in line with the historical dilution and historical loss rates (and therefore within the stressed dilution and loss rate). Actual turnover of the securitized portfolio has been approximately 45 days and well within the historical turnover of the sellers portfolio. Moody's Investors Service received and took into account a third party due diligence report prepared by KPMG on the underlying assets or financial instruments in this transaction and the due diligence report had a positive impact on the rating. The due diligence report involved the review of approximately 235,000 invoices or BRL1.8 billion of invoices originated from April 1, 2007 through March 2010. =========================== C A Y M A N I S L A N D S =========================== ABN AMRO: Shareholders' Final Meeting Set for April 8 ----------------------------------------------------- The shareholders of ABN Amro Management (Cayman) Limited will hold their final meeting on April 8, 2011, at 10:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Richard E. L. Fogerty c/o Iain Gow Zolfo Cooper (Cayman) Limited P.O. Box 1102 Cayman Financial Centre, 4th Floor Building 3, Grand Cayman KY1-1102 Telephone: +1 (345) 946-0081 Facsimile: +1 (345) 946-0082 e-mail: iain.gow@zolfocooper.ky CADOGAN ALTERNATIVE: Shareholders' Final Meeting Set for April 8 ---------------------------------------------------------------- The shareholders of Cadogan Alternative Strategies Sterling II SPC Ltd. will hold their final meeting on April 8, 2011, at 11:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Tammy Fu c/o Iain Gow Zolfo Cooper (Cayman) Limited P.O. Box 1102 Cayman Financial Centre, 4th Floor Building 3 Grand Cayman KY1-1102 Telephone: +1 (345) 946-0081 Facsimile: +1 (345) 946-0082 e-mail: iain.gow@zolfocooper.ky CYNRIC INVESTMENTS: Shareholders' Final Meeting Set for April 21 ---------------------------------------------------------------- The shareholders of Cynric Investments Limited will hold their final meeting on April 21, 2011, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands DAGONET INVESTMENTS: Shareholders' Final Meeting Set for April 21 ----------------------------------------------------------------- The shareholders of Dagonet Investments Limited will hold their final meeting on April 21, 2011, at 11:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands GAWAIN INVESTMENTS: Shareholders' Final Meeting Set for April 21 ---------------------------------------------------------------- The shareholders of Gawain Investments Limited will hold their final meeting on April 21, 2011, at 10:40 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands HERITAGE REAL: Shareholders' Final Meeting Set for April 18 ----------------------------------------------------------- The shareholders of Heritage Real Estate Securities Fund I, Ltd, will hold their final meeting on April 18, 2011, at 4:00 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: DMS Corporate Services Ltd c/o Bernadette Bailey-Lewis Telephone: (345) 946 7665 Facsimile: (345) 946 7666 dms House, 2nd Floor P.O. Box 1344,Grand Cayman KY1-1108 Cayman Islands INTERKRAFT MAC 34: Members' Final Meeting Set for April 18 ---------------------------------------------------------- The members of Interkraft MAC 34 Ltd. will hold their final meeting on April 18, 2011, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Beverly Mathias c/o Citco Trustees (Cayman) Limited P.O. Box 31106, Grand Cayman KY1-1205 Cayman Islands JOLS INVESTMENTS: Shareholders' Final Meeting Set for April 21 -------------------------------------------------------------- The shareholders of Jols Investments Limited will hold their final meeting on April 21, 2011, at 10:50 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands PAKPOLEE RETAIL: Shareholder to Receive Wind-Up Report on April 6 ----------------------------------------------------------------- The shareholder of Pakpolee Retail Investments Limited will receive on April 6, 2011, at 10:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Galaxy Chan Mei Lan KPMG Prince's Building, 8th Floor 10 Chater Road, Central Hong Kong c/o Graham Kot Telephone: +852 2847 5130 / +852 2140 2888 Facsimile: +852 2869 7357 / +852 2869 7357 Alexandra House, 27th Floor 18 Chater Road, Central Hong Kong PINEBRIDGE RP: Shareholders' Final Meeting Set for April 15 ----------------------------------------------------------- The shareholders of Pinebridge RP Vantage, Ltd., will hold their final meeting on April 15, 2011, at 10:15 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands RIVERSIDE FUNDING: Shareholders' Final Meeting Set for April 15 --------------------------------------------------------------- The shareholders of Riverside Funding will hold their final meeting on April 15, 2011, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers SPV Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands SANTOSHI CLO 2009: Shareholders' Final Meeting Set for April 15 --------------------------------------------------------------- The shareholders of Santoshi CLO 2009 Capital Corporation will hold their final meeting on April 15, 2011, at 9:15 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers SPV Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands WHITEBOX DIVERSIFIED: Shareholders' Final Meeting Set for April 19 ------------------------------------------------------------------ The shareholders of Whitebox Diversified Convertible Arbitrage Fund, Ltd, will hold their final meeting on April 19, 2011, at 4:00 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: DMS Corporate Services Ltd c/o Bernadette Bailey-Lewis Telephone: (345) 946 7665 Facsimile: (345) 946 7666 dms House, 2nd Floor P.O. Box 1344,Grand Cayman KY1-1108 Cayman Islands YONTOSHI CLO2: Shareholders' Final Meeting Set for April 15 ----------------------------------------------------------- The shareholders of Yontoshi CLO2 Capital Corporation will hold their final meeting on April 15, 2011, at 9:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers SPV Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands YU SHAN: Shareholders' Final Meeting Set for April 15 ----------------------------------------------------- The shareholders of Yu Shan Leasing Limited will hold their final meeting on April 15, 2011, at 9:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands ================================== D O M I N I C A N R E P U B L I C ================================== RAHAXI INC: Pendle Properties Owns 100MM Shares of Common Stock --------------------------------------------------------------- In a Form 3 filing with the U.S. Securities and Exchange Commission, Pendle Properties Ltd. disclosed that it beneficially owns 100 million shares of common stock of Rahaxi, Inc. About Rahaxi Inc. Rahaxi, Inc. (OTC BB: RHXI) is a provider of electronic payment processing services, including credit and debit card transaction processing, point-of-sale related software applications and other value-added services. The Company's principal offices are in Wicklow, Ireland. The Company also has offices in Helsinki, Finland and Santo Domingo, the Dominican Republic. While the Company's offices in Finland and Ireland will primarily focus on the European market, the Company's office in the Dominican Republic will continue to pursue opportunities in the Caribbean and Latin America, including its recently developed electronic PIN distribution application for point of sale solutions in association with some of the most important telecommunications companies in the Dominican Republic and Haiti. The Company's balance sheet as of March 31, 2010, showed $2,596,123 in assets, $7,522,578 of liabilities, for a stockholders' deficit of $4,926,455. RBSM LLP, in New York, expressed substantial doubt about the Company's financial statements for the fiscal year ended June 30, 2009. The independent auditors noted that the Company is experiencing difficulty in generating sufficient cash flow to meet it obligations and sustain its operations. ============= J A M A I C A ============= NATIONAL COMMERCIAL: Fitch Upgrades Individual Rating to 'D' ------------------------------------------------------------ Fitch Ratings has upgraded Jamaica-based National Commercial Bank Jamaica Limited Individual Rating to 'D' from 'D/E'. Fitch has simultaneously affirmed NCBJ's other ratings: -- Long-term foreign and local currency Issuer Default Ratings at 'B-'; -- Short-term foreign and local currency IDR at 'B'; -- Support rating at '5'; -- Support floor at 'B-'. The Rating Outlooks for the long-term IDRs are Stable and in line with Fitch's view of the sovereign's creditworthiness. Future rating actions will be highly contingent upon a change in Fitch's view on Jamaica's sovereign creditworthiness given the bank's sizeable sovereign exposure, which reached 59% of total assets and about four times equity at fiscal year-end 2010. Additionally, downward pressure on the ratings could return if there was an unexpected material deterioration of asset quality or capitalization ratios. The upgrade of NCBJ's Individual Rating reflects the bank's improved financial performance against a back-drop of economic crisis, high market volatility and participation in the Jamaican debt exchange. Sustained growth of the bank's profitability has contributed to strong internal capital generation and increased NCBJ's total regulatory capital ratio to 16% at FYE10 from 14.6% at FYE09. A strong domestic franchise, stable profitability and adequate capitalization support the current ratings of NCBJ. Nevertheless, NCBJ's ratings remain constrained by high exposure to the Jamaican public sector and large corporate loans, as well as a challenging operating environment. While the bank's Support rating is constrained by the sovereign's weak credit profile, the Support floor of 'B-' indicates Fitch's view that NCBJ's systemic importance makes the government's propensity to support the bank high. NCBJ's strategy of reducing funding costs prior to the JDX and improving efficiency more than compensated for lower interest and trading income, underpinning a steady improvement in net income over the past five years. As a result, the bank's ROAA improved to 3.4% at FYE10 from 2.8% at FYE06. Sustained healthy profitability combined with a moderate cash dividend payout policy has resulted in a steady improvement in NCBJ's capitalization. The bank's equity/assets ratio is strong relative to the Jamaican banking system average and to most internationally rated peers (banks in a similar operating environment with a long-term IDR of 'B-/B/B+'). Almost all of NCBJ's capital is Tier I. High Tier 1 capital combined with the bank's increased exposure to the public sector, led to an improvement in Fitch's core capital/weighted risks ratio to 42.9% at FYE10 from 33.7% at FYE09. Although NCBJ's asset quality indicators deteriorated slightly in FY10 due to the ongoing recession and a seasoning of the loan portfolio, these remain in line with internationally rated peers. The bank's impaired loans/total loans ratio increased to 3.2% at FYE10, while reserves for impaired loans covered 105% of impaired loans. Nevertheless, lending concentration remains high relative to peers. NCBJ's strong franchise and conservative risk management should allow the bank to continue weathering its volatile operating environment. NCBJ is the largest bank in the system in terms of assets with more than 30% of market share in recent years. In 2002, the Jamaican government sold a majority stake in the bank to Advantage Investment Corporation, one of Canada's largest privately held mutual fund management companies. =========== M E X I C O =========== CORPORACION GEO: Fitch Upgrades Issuer Default Rating to 'BB-' -------------------------------------------------------------- Fitch Ratings has upgraded the foreign and local currency Issuer Default Ratings of Corporacion Geo, S.A.B. de C.V., to 'BB-' from 'B+'. Fitch has also upgraded GEO's long-term national scale rating to 'A-(Mex)'from 'BBB+(Mex)'. In addition, Fitch has affirmed at 'BB-' these senior unsecured obligations of GEO: -- US$250 million senior notes due 2014; -- US$250 million senior notes due 2020. The Rating Outlook is Stable. In accordance with Fitch's published methodology, the Recovery Ratings on GEO's senior notes will no longer be published. The rating upgrade reflects the company's consistent financial and operational performance, and the consolidation of its business position during 2010. GEO's 2010 full-year results included stable operational results, adequate liquidity coupled with good access to international markets, and stable gross leverage levels in the 2.0 times to 2.5x range. Like other Mexican and regional homebuilders, the company's free cash flow trend has been negative over the last years, which is expected to continue in the medium term as the sector continues to grow and require increasing working capital. Also incorporated in the upgrade is the consolidation of the company's leadership position in Mexico's low-income segment, better geographic diversification, and a consistent business model focusing primarily on the formal low-income segment, which makes its working capital cycle shorter than its similar-scale peers. The company's consistent focus on operations and on its land reserves during 2010, avoiding acquisitions of distressed housing projects that could put pressure on its cash flow generation, is also a positive. The ratings are supported by GEO's solid market position in the Mexican homebuilding industry, consistent business strategy oriented toward the growing low-income housing segment, geographic diversification, adequate land reserves, sufficient liquidity, and moderate leverage. The ratings are constrained by GEO's aggressive growth strategy and high working capital requirements, which will limit the company's capacity to generate positive FCF in the near and medium term. The Stable Outlook incorporates the expectation that GEO's credit metrics will remain stable during 2011. The ratings factor in GEO's solid market share position in the sector, being the largest homebuilders in Mexico in terms of number of units sold, with 56,093 units sold during 2010, and also its leading market share position in terms of mortgages granted by Infonavit and Fovissste. The ratings also consider GEO's solid geographic diversification with a presence in 20 states in Mexico, which mitigates the inherent risks associated with operating in a specific region, reducing its dependency on specific local and municipal governments to secure land and permits. Further, the company benefits from large-scale and nationwide operations as the largest homebuilder in Mexico, which allows GEO to benefit from economies of scale, better negotiating position with suppliers, superior access to credit markets, and enhanced relationships with land suppliers. Incorporated in the ratings is the expectation that the company's FCF will remain negative as the business' growth continues to increase working capital needs. The ratings incorporate the view that GEO will continue with its growth strategy, reaching levels of approximately 63,000 units sold during 2011. As with other Mexican homebuilders, the business growth has put pressure in GEO's capacity to generate FCF, mainly due to an increase in the company's inventory level to MXN25 billion at the end of 2010 from MXN17.2 billion at the end of 2008. The company's FCF was negative for 2010 at around MXN2.6 billion; it was also negative during 2009 (MXN978 million). FCF calculation considers cash flow from operations after interest paid less capex and distributed dividends. Positively factored into the ratings is the company's adequate liquidity and good debt payment schedule that provides financial flexibility. With MXN2.2 billion in cash, MXN1.1 billion short- term receivables, and approximately MXN8.4 billion in unused uncommitted credit lines available at Dec. 31, 2010, the company has satisfactory liquidity. Further, GEO currently has a manageable long-term debt maturity schedule with maturities of MXN71 million, MXN78 million, and MXN66 million for 2011, 2012, and 2013, respectively. Ratings incorporate expectations that GEO's cash position will be around MXN2 billion during 2011 and that the company's maturity schedule will remain manageable. GEO's main debt maturities are the US$250 million unsecured notes due in 2014 and the US$250 million senior notes due in 2020. The company's gross leverage is expected to remain stable in the 2.0x-2.5x Range. During the last 12 months ended in December 2010, the company's total debt remained relatively stable, decreasing approximately 12% when comparing its debt level with that in December 2009. GEO's gross leverage was 2.1x by the end of December 2010 (also 2.1x by the end of December 2009). Also positively incorporated in the ratings are GEO's significant and well-targeted land reserves. As of Dec. 31, 2010, the company had land reserves equivalent to 387,904 homes, which represents around five years of production considering the expected business growth for the next years. ==================== P U E R T O R I C O ==================== DJSP ENTERPRISES: Securities Delisted From NASDAQ Stock Market -------------------------------------------------------------- DJSP Enterprises, Inc., notified the U.S. Securities and Exchange Commission that its ordinary shares, warrants, and units have been removed from The NASDAQ Stock Market, LLC. About DJSP Enterprises Based in Plantation, Florida, DJSP Enterprises, Inc. (Nasdaq: DJSP, DJSPW, DJSPU) provides a wide range of processing services in connection with mortgages, mortgage defaults, title searches and abstracts, REO (bank-owned) properties, loan modifications, title insurance, loss mitigation, bankruptcy, related litigation and other services. Its principal customer is The Law Offices of David J. Stern, P.A. It has additional operations in Louisville, Kentucky and San Juan, Puerto Rico. Its U.S. operations are supported by a scalable, low-cost back office operation in Manila, the Philippines, that provides data entry and document preparation support for its U.S. operations. As reported in the Jan. 20, 2011 edition of the TCR, DAL Group, LLC, a subsidiary of DJSP Enterprises, has obtained waivers on notes held by these parties for payments due through April 1, 2011: Amount of Note -------------- Law Offices of David J. Stern, P.A. $47,869,000 Chardan Capital, LLC, $1,000,000 Chardan Capital Markets, LLC $250,000 Kerry S. Propper $1,500,000 The waivers were sought by DAL as it develops and implements plans to restructure its ongoing operations to reflect its significantly reduced revenues and operations and the other changes. DAL did not make the interest payments due Jan. 3, 2011 for (i) unsecured term notes in the aggregate principal amount of $1,600,000 (ii) and a $500,000 term note issued by Cornix Management, LLC. DAL is seeking waivers from the holders of the unsecured notes and Cornix of principal and interest payments otherwise due under these notes, and the default interest rates under these notes, through April 1, 2011. DAL has entered into a forbearance agreement with BA Note Acquisition, LLC, pursuant to which BNA has agreed to forbear from taking action on a $5.5-million line of credit until March 9, 2011. ================= V E N E Z U E L A ================= BANCO EXTERIOR: Fitch Affirms 'B+' Issuer Default Ratings --------------------------------------------------------- Fitch Ratings has upgraded Venezuela-based Banco Exterior, CA Banco Universal's national ratings: -- Long-term national scale rating to 'AA(ven)' from 'AA-(ven)'; -- Short-term national scale rating to 'F1+(ven)' from 'F1(ven)'. In addition, Fitch affirms these international ratings: -- Long-term foreign and local currency Issuer Default Ratings at 'B+'; -- Short-term foreign and local currency ratings at 'B'; -- Individual at 'D'; -- Support at '5'; -- Support floor at 'NF'. The Rating Outlook for the long-term IDR is Stable. The upgrade on Exterior's national scale ratings recognizes the resilience of the banks results in times of economic stress and regulatory intervention. Exterior's ability to expand its loan portfolio and control credit costs compares among the strongest in the country; while its capacity to control costs and enhance its spreads have allowed the bank not only to post one of the highest profitability ratios in the country, but even still aligned with its previous historic average. Such earnings capacity has been able to compensate a relative ample cash dividend distribution policy and also fund its growth; a trend that Fitch expects to be preserved in the short and medium term under the absence of significant government interference. The ratings of Exterior reflect its good profitability, strong asset quality, and sufficient capitalization. Its ratings are constrained by its size, the need to further diversify revenue sources, and the negative effects of government intervention over the bank business and overall private sector activities. Downturns in Exterior's profitability and capitalization ratios, further exacerbated by government intervention, could trigger negative changes to all its ratings. Exterior's performance has been solid for a number of years. A still limited income diversification has been more than compensated by its low funding mix cost and operational efficiency, while credit costs remain low due to its sound asset quality. Exterior's higher than average operating profit to average assets ratio could remain close to 4% in the short and medium term, although an absence of non recurrent income, a less benign economic environment and government interference could undermine such expectations. Credit metrics quality is strong and compares favorably to its peer, thanks to a sound origination process and strict collection efforts, and despite the volatile operating environment and recent government actions of nationalization and seizure of private companies. As such, the ratio of past due loans to total loans stood at a low 0.83% as of September 2010 (with a four-year average of 0.41%), a level that may increase due the challenging operating environment, but still ranking among the best ratios locally and expected to remain around 1%. Despite lower-than- proportional credit losses in the past, Fitch believes that reserve levels are considered somewhat tight, given the forced expansion into new segments (compulsory lending required by the government), and Exterior's lower capitalization. In spite of Exterior's high internal capital generation capacity, a more than proportional asset growth and increasing dividend pay-out, has hindered Exterior's historic strong capitalization ratios. Thus, the equity-to-assets ratio decreased to 7.88% at Sept. 30, 2010, although it is expected to recover and remain close to its historic average (8.70% for 2006-2009). Exterior's capital base is Tier I capital components. One of Exterior's largest challenges is to preserve and enhance its current capital base, given the pressures derived of a complex regulatory scheme and rapid loan expansion. Exterior is a mid-size bank in Venezuela, with a 3.7% market share in terms of total assets at Sept. 30, 2010. Spain's Grupo Bancario Industrial Fierro controls about 83% of Exterior's equity and has interests in other financial institutions in Latin America and Miami. MERCANTIL CA: Fitch Affirms 'B+' Issuer Default Ratings ------------------------------------------------------- Fitch Ratings has affirmed Venezuela-based Mercantil, C.A. Banco Universal's ratings: -- Long-term foreign and local currency Issuer Default Ratings at 'B+'; -- Short-term foreign and local currency ratings at 'B'; -- Individual at 'D'; -- Support at 5; -- Support Floor NF; -- Long-term national-scale rating at 'AA+(ven)'; -- Short-term national-scale rating at 'F1+(ven)'. The Rating Outlook for the long-term IDR is Stable. MB's ratings reflect its strong franchise, stable retail deposit base, and adequate performance sustained by an above-average risk control culture, while its ratings are hindered by the negative effects of government intervention over the bank business and overall private sector activities. Going forward, government intervention is a major risk for Venezuelan banks; nevertheless, MB's conservative business plan, adequate risk control techniques, long-lasting expertise, and current capital base provide some room for maneuver in case of further intervention. MB has been consistently able to post healthy asset quality ratios thanks to its local above-average credit risk culture, despite the volatile operating environment and recent government actions of nationalization and seizure of private companies. As such, the ratio of past due loans to total loans stood at a low 1% as of September 2010 (with a the four-year average of 0.75%), a level that may increase due the challenging operating environment and lower than average expected loan growth, but still ranking among the best ratios locally. In terms of reserves, MB's policy will continue to stand above the local peer average, at 4.1% of total loans. The bank's strategy of focusing on reducing its funding costs and boosting loan growth in higher yield segments has more than compensated for the lag on operating revenues and precautionary loan loss provisions. As such, MB's ROAA ratio could remain above 2%, as has been shown in the recent years. Even though there is still room for improvement, MB's capital ratios remain adequate and above the system average based on adequate profitability and moderate cash dividend payout. MB's capital position is mostly unencumbered and considered all Tier I capital. As such, Fitch eligible capital to total assets steadily improved to 9.2% as of September 2010 (16.5% if risk weighted assets are considered), a level deemed adequate given the risk profile of the bank and good provisioning. MB's strong franchise and conservative asset and liability management will continue to allow the bank to cope with inherent volatility of deposits in Venezuela. The bank has been identified several times as a safe haven in times of systemic stress, as happened during the funding volatility observed in 2010. MB was the fourth largest bank in Venezuela at September 2010, with almost 11% of market share in terms of assets. MB is 99.9% owned by Mercantil Servicios Financieros, a holding company with major investments in Venezuela and the U.S. *********** 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. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR-LA. 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., Frederick, Maryland USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Valerie U. Pascual, Psyche A. Castillon, Julie Anne G. Lopez, Ivy B. Magdadaro, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2011. 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$625 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 Christopher Beard at 240/629-3300. * * * End of Transmission * * *